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Top court rules an LLP is not a body corporate having a share capital and therefore did not qualify for the stamp duty group exemption relief
In the recent decision John Wiley & Sons UK2 LLP and Another v The Collector of Stamp Revenue, the Court of Final Appeal (CFA) upheld the decision of the Court of Appeal (CoA) that a limited liability partnership (LLP) is not a body corporate having a share capital.
As such, an LLP cannot satisfy the “association” relationship for the exemption relief under section 45 of the Stamp Duty Ordinance (SDO) by virtue of having its “issued share capital” being at least 90 percent beneficially owned by another “body corporate”.
This CFA decision could mean that, in addition to LLPs, some foreign limited liability corporations (LLCs) that do not have a share capital as envisaged by the old Companies Ordinance (Cap 32) of Hong Kong may also not qualify as a “body corporate” for the purposes of section 45 of the SDO.
Clients who have any questions on the implications of this CFA decision can contact their tax executive.