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should not be deducted from the benefits they provide to the partner-
ship. As per Article 628/2 TCO, a partner, who is being paid by the
partnership for an assigned duty, is responsible as a “proxy” in accor-
dance with the provisions of the TCO on proxy contracts.
Pursuant to Article 627 TCO, partners shall be responsible to a
specific partner who incurred expenses or debts for the partnership. All
partners shall also be responsible for the incurred damages, results and
risks arising directly from such management rights. A partner who
lends money to the partnership may ask for interest as of the lending
date and a partner who expends effort for the business of an ordinary
partnership, without any obligation, may request an equitable payment.
Changes in the Partnership
To join an ordinary partnership as a new partner, the consent of all
partners is required. Similarly, to transfer shares of the partnership to a
third party in an ordinary partnership, such third party cannot become
a partner without consent of the other partners, and cannot acquire the
right to interfere with the management of the partnership.
The acceptable reasons for the exit or the squeeze out of a partner
from an ordinary partnership, which may be regulated under the part-
nership agreement, are: serving a termination notice to the other part-
ners, being declared legally incapacitated, insolvency, foreclosure of a
partner’s liquidation share and death. In the event of the exit or squeeze
out of a partner from the ordinary partnership, the partnership share of
such partner is automatically transferred to the other partners
pro rata
to their shares. Other partners should return the goods to the
exiting/squeezed out partner whom he brought into the partnership,
release him from the several liability for the due debts of the partner-
ship and pay him the liquidation share, which should be paid if the
partnership is liquidated on the date he exits or is squeezed out. If the
assets of the partnership are not sufficient to pay the debts of the part-
nership at the exit/squeeze out date, such partner should pay the loss
pro rata
to his share. In addition, the exiting/squeezed out partner joins
the profit and loss of the works which were not completed while he
was a partner.
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