THE Gallop Government plans new legislation to ensure Western Australia can benefit fully from national venture capital laws.
The State moves follow changes to Federal laws, which grant favourable tax treatment to venture capital limited partnerships.
Consumer and Employment Protection Minister John Kobelke said the changes to national laws could leave WA seriously disadvantaged by investors going to other States, where limited partnerships were easier to set up.
“New legislation will ensure investors, looking to take up limited partnerships, will have the same options here in WA that they now have access to in the eastern States,” Mr Kobelke said.
A limited partnership allows members to invest in a partnership venture with limited liability for the debts of the partnership, provided they are not involved in the management of the partnership venture.
The proposed WA changes would remove uncertainty about limited partners in the management of the limited partnership business.
Among other changes, the new legislation would also remove the stamp duty imposed on capital contributions made to a limited partnership and allow an unlimited number of partners to be involved in the partnership.
Law Society of WA president Elizabeth Heenan and Australian Venture Capital Association spokesman Jake Burgess have welcomed the changes.
Ms Heenan said limited partnerships had been used for many years in the US and Europe.
Mr Burgess said limited partnerships were the investment vehicle of choice for the venture capital industry worldwide.
The first three limited partnerships to be registered under the Commonwealth’s new rules have been launched by Macquarie Bank, Deutsche Bank and Starfish Ventures.
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