Limited Partnership Interest Transfer and Assignee Admission in Arkansas

At a glance

Requirements one by one

Interest transferred and effect

Section 4-47-701 calls the transferable interest the partner’s only transferable interest. Section 4-47-702(a) permits all or part of that right to move without the transfer itself dissociating the partner or winding up the LP. The partnership agreement governs partner relations unless the act supplies a nonwaivable rule (§ 4-47-110(a)).

Transferee rights and admission

Section 4-47-702(b) gives the transferee assigned distributions and the net amount otherwise distributable to the transferor on winding up. Subsection (c) provides an account of transactions only from the dissolution date; subsection (a)(3) withholds management and ordinary records rights. A person becomes a limited partner under the agreement or with all partners’ consent (§ 4-47-301).

What trips people up

Partner status and the 2007 transition need separate checks. For partnerships formed under the 2007 act, § 4-47-702(d) keeps the transferor’s other rights and all duties. A full transfer can support unanimous expulsion of a limited partner under § 4-47-601(b)(4)(B), except for a security transfer or uncompleted charging order. But § 4-47-1206(b)(3) preserves earlier dissociation law for pre-September 2007 LPs unless the partners elect otherwise; the newer § 601 expulsion route does not automatically govern them.

Restrictions and notice operate separately. Section 4-47-702(f) makes a transfer contrary to an agreement restriction ineffective against a person who had notice of that restriction at transfer. Subsection (e) lets the partnership wait to recognize the transferee’s rights until it has notice of the transfer.

Admission may transfer old obligations. Section 4-47-702(g) makes an admitted transferee liable for the transferor’s obligations under §§ 4-47-502 and 4-47-509, except liabilities unknown at admission. Those provisions cover contribution commitments and knowing receipt of improper distributions.

Common questions

Can a transferee inspect records before admission? Section 4-47-702(a)(3) withholds ordinary records access. The winding-up account under subsection (c) is a narrower right.

Does a gift or partial transfer require unanimous partner consent? Section 4-47-702(a) permits a full or partial transfer of the economic interest. Section 4-47-301(3)’s all-partner consent route concerns admission as a limited partner; agreement restrictions can still affect the transfer under § 4-47-702(f).

Statutes and sources

• Ark. Code Ann. § 4-47-110: “4-47-110. Effect of partnership agreement — Nonwaivable provisions. (a) Except as otherwise provided in subsection (b), the partnership agreement governs relations among the partners and between the partners and the partnership. To the extent the partnership agreement does not otherwise provide, this chapter governs relations among the partners and between the partners and the partnership.” (official enrolled act; accessed October 2, 2026).
• Ark. Code Ann. § 4-47-301: “4-47-301. Becoming limited partner. A person becomes a limited partner: (1) as provided in the partnership agreement; (2) as the result of a conversion or merger under subchapter 11; or (3) with the consent of all the partners.” (official enrolled act; accessed October 2, 2026).
• Ark. Code Ann. § 4-47-502: “4-47-502. Liability for contribution. (a) A partner’s obligation to contribute money or other property or other benefit to, or to perform services for, a limited partnership is not excused by the partner’s death, disability, or other inability to perform personally.” (official enrolled act; accessed October 2, 2026).
• Ark. Code Ann. § 4-47-509: “(b) A partner or transferee that received a distribution knowing that the distribution to that partner or transferee was made in violation of § 4-47-508 is personally liable to the limited partnership but only to the extent that the distribution received by the partner or transferee exceeded the amount that could have been properly paid under § 4-47-508.” (official enrolled act; accessed October 2, 2026).
• Ark. Code Ann. § 4-47-601: “(4) the person’s expulsion as a limited partner by the unanimous consent of the other partners if: (A) it is unlawful to carry on the limited partnership’s activities with the person as a limited partner; (B) there has been a transfer of all of the person’s transferable interest in the limited partnership, other than a transfer for security purposes, or a court order charging the person’s interest, which has not been foreclosed;” (official enrolled act; accessed October 2, 2026).
• Ark. Code Ann. § 4-47-701: “4-47-701. Partner's transferable interest. The only interest of a partner which is transferable is the partner’s transferable interest. A transferable interest is personal property.” (official enrolled act; accessed October 2, 2026).
• Ark. Code Ann. § 4-47-702: “4-47-702. Transfer of partner's transferable interest. (a) A transfer, in whole or in part, of a partner’s transferable interest: (1) is permissible; (2) does not by itself cause the partner’s dissociation or a dissolution and winding up of the limited partnership’s activities; and (3) does not, as against the other partners or the limited partnership, entitle the transferee to participate in the management or conduct of the limited partnership’s activities, to require access to information concerning the limited partnership’s transactions except as otherwise provided in subsection (c), or to inspect or copy the required information or the limited partnership’s other records. (b) A transferee has a right to receive, in accordance with the transfer: (1) distributions to which the transferor would otherwise be entitled; and (2) upon the dissolution and winding up of the limited partnership’s activities the net amount otherwise distributable to the transferor. (c) In a dissolution and winding up, a transferee is entitled to an account of the limited partnership’s transactions only from the date of dissolution. (d) Upon transfer, the transferor retains the rights of a partner other than the interest in distributions transferred and retains all duties and obligations of a partner. (e) A limited partnership need not give effect to a transferee’s rights under this section until the limited partnership has notice of the transfer. (f) A transfer of a partner’s transferable interest in the limited partnership in violation of a restriction on transfer contained in the partnership agreement is ineffective as to a person having notice of the restriction at the time of transfer. (g) A transferee that becomes a partner with respect to a transferable interest is liable for the transferor’s obligations under §§ 4-47-502 and 4-47-509. However, the transferee is not obligated for liabilities unknown to the transferee at the time the transferee became a partner.” (official enrolled act; accessed October 2, 2026).
• Ark. Code Ann. § 4-47-1206: “4-47-1206. Application to existing relationships. (a) Except as otherwise provided in subsection (b), on and after September 1, 2007, this chapter governs all limited partnerships. (b) With respect to a limited partnership formed before this chapter takes effect, the following rules apply except as the partners otherwise elect in the manner provided in the partnership agreement or by law for amending the partnership agreement: (1) section 4-47-104(c) does not apply and the limited partnership has whatever duration it had under the law applicable immediately before the limited partnership became subject to this chapter; (2) the limited partnership is not required to amend its certificate of limited partnership to comply with § 4-47-201(a)(4); (3) sections 4-47-601 and 4-47-602 do not apply and a limited partner has the same right and power to dissociate from the limited partnership, with the same consequences, as existed immediately before the limited partnership became subject to this chapter; (4) section 4-47-603(4) does not apply; (5) section 4-47-603(5) does not apply and a court has the same power to expel a general partner as the court had immediately before the limited partnership became subject to this chapter; and (6) section 4-47-801(3) does not apply and the connection between a person's dissociation as a general partner and the dissolution of the limited partnership is the same as existed immediately before the limited partnership became subject to this chapter;” (official enrolled act; accessed October 2, 2026).