The travails of the global economy appear to be still not behind us, despite gradual recovery during 2010 from the worst global economic conditions since World War II. Continued fiscal and debt burdens vitiate the recovery process, imparting a degree of fragility and uncertainty to global economic conditions. The world needs a new source of growth and stability, and India, a rapidly growing economy with strong internal demand, offers a new opportunity. India remained relatively untrammeled by the developments in the Eurozone and reverted to close to 9% GDP growth rates in 2010. Growth was broad-based across all sectors, including agriculture, manufacturing and services. Public commitment to calibrated exit from expansionary fiscal policy and continued corporate and household confidence have helped sustain a virtuous growth cycle. The resurgence of the rural economy and intensified infrastructure mission further strengthened the foundations for medium-term growth propensities.

 

Lessons leant from the many past family disputes, is leading to many family businesses structure their personal and business assets in a manner which helps in better succession planning minimizing future disputes whilst creating enough opportunities to grow, raise money and create value. Questions are many, should the businesses be held through a trust, company, partnership firm, LLPS. Where should these entities be registered, where should the group IPs and brands be housed- in operating companies or separate companies, what should be the ideal structure - should we have holding companies, trading companies or IPR companies, should these companies be bucketed together or separately and many more strategic issues. Further, the recently introduced LLP provisions and the recent amendment to the FDI norms permitting foreign investment in LLPS provides a opportunity worth exploring for doing businesses through LLPS ring fencing liability whilst better planning taxes. Without doubt, setting up a completely new set up for family businesses or LLPS is relatively easy, transitioning an existing structure into a desired structure/ LLPs has a plethora of tax, commercial and regulatory consideration. This session will explore the possible structuring opportunities and the key challenges to be addressed in this exciting area.