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requirement. The only requirement is the agreement of partners which
may either be written or oral, without any notarization or registration
requirement. However, in practice, ordinary partnership agreements
are executed in a written form and even, in the presence of notary
publics, for the ease of proof.
Each partner should make a contribution to the partnership in the
form of cash, receivables, goods or efforts. Unless otherwise agreed
under the ordinary partnership agreement, each partner’s contribution
should be equal and should be in the character and significance
required by the goal of such partnership.
Moreover, unless the partners agree to the contrary, the share of
each partner in profit and loss should also be equal, irrespective of the
value of their contributions. Pursuant to Article 623/2 of the TCO, if
the share of a partner specified in the ordinary partnership agreement
is determined only for losses or only for profits, such share will be con-
sidered as agreed both for losses and profits. It is only possible for a
partner to join solely to profits but not to losses, if such partner con-
tributes his efforts to the partnership.
Governance and Representation of Ordinary Partnerships
Pursuant to Article 624 of the TCO, resolutions of an ordinary
partnership should be adopted unanimously, unless the partners agree
that they can be adopted by a majority vote; and in such case, a major-
ity is determined based on the number of the partners, and not the per-
centage of their contributions to the partnership.
As a general rule, the TCO provides that all partners have the right
of management and representation of the partnership, unless otherwise
agreed by the partners. The partners may assign the representation and
management authority to one or more partners, or to a third person. As
per Article 625 of the TCO, any partner holding management authori-
ty may act on his/her own but any other partner with management
authority may stop a transaction by objecting to it prior to its comple-
tion. Unanimity is required to appoint someone to the general man-
agement of the partnership and to conduct activities under the extra-
ordinary course of business. However, in case of emergency, all part-
ners with the management authority may take necessary measures.
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NEWSLETTER 2014