Slaughters partnership to mull over conversion to LLP status

Slaughter and May

is considering a move to UK limited-liability partnership (LLP) status and will put the proposal to its partners later this year.

Practice partner David Frank told The Lawyer: “We’re looking at whether we should convert.”

If carried, Slaughters would be the first of the firm’s best friends network to depart from a traditional partnership structure.

The London offices of a number of US firms are also expected to change to UK LLP status at the end of 2004, following Kilpatrick Stockton’s lead.

Mayer Brown Rowe & Maw partner Richard Linsell, speaking at the OnRisk conference organised by insurer The St Paul last Wednesday (9 June), said the driver for a US firm to become a UK LLP is the better quality of the limited liability.

Many US LLP models – used by firms such as Clifford Chance – specifically state that individual partners are liable to claims, but the UK structure offers more security and has several tax advantages.
Half of the delegates at last Wednesday’s conference said their firms were likely to become LLPs within the next 18 months.
Medium-sized firms are under most pressure to make the move, although the advantages are not immediately obvious.

Just a month ago, Allen & Overy became the first magic circle firm to become a UK LLP, with all but four of its offices converting. Authorities in Spain and Italy are yet to make a decision on the model’s tax status, while regulations in Hong Kong and Luxembourg do not allow foreign LLPs.