Limited Partnership Interest Transfer and Assignee Admission in New Jersey

At a glance

Requirements one by one

What assignment transfers

Section 42:2A-5(j) defines the partnership interest as a share of profits and losses and a right to distributions; § 42:2A-12 makes it personal property. Under § 42:2A-47, a whole or partial assignment transfers only the assigned distribution entitlement. The assignee receives no partner powers from assignment alone, and the assignment does not dissolve the partnership.

Admission as a limited partner

Section 42:2A-49(a) permits an assignee, including one of a general partner, to become a limited partner if the assignor grants that right under authority described in the certificate, or all general partners and two-thirds in interest of the limited partners consent. Section 42:2A-5(m) measures “in interest” by limited-partner contribution shares unless the certificate or agreement provides otherwise. A limited partner’s grant power and its conditions are certificate contents under § 42:2A-14(g). Section 42:2A-25(b) calls for exercise of that power and compliance with any limiting conditions.

What trips people up

Full assignment can change the assignor’s status. Section 42:2A-47 ends partner status by default when the entire interest is assigned, unless the agreement says otherwise. But a general partner assigning all general-partnership interest ceases to be a general partner only when a certificate reflecting that fact is filed. Under § 42:2A-16(d), a certificate amendment takes effect on filing or a specified date no more than 30 days later.

Admission does not erase prior obligations. Section 42:2A-49(b) gives the admitted assignee limited-partner restrictions and liabilities, plus the assignor’s obligations. It protects the assignee against liabilities unknown at admission and unascertainable from the certificate or partnership agreement. Subsection (c) preserves the assignor’s liability under the specified statutory sections.

Distribution rights and information rights differ. Section 42:2A-47 gives the assignee the assigned distributions without partner powers. Section 42:2A-29 reserves statutory inspection and information rights for a limited partner. Section 42:2A-25(a) has a separate admission route for a person acquiring an interest directly from the partnership.

Common questions

Is every limited partner’s vote counted equally for admission? Section 42:2A-5(m) supplies a contribution-share definition of “in interest” unless the certificate or agreement changes it; § 42:2A-49(a) uses that measure for the two-thirds consent threshold.

Does a general partner’s assignee automatically become a general partner? No. Section 42:2A-49(a) offers a route to limited-partner status, and § 42:2A-47 denies automatic partner rights from assignment.

Statutes and sources

• N.J.S.A. § 42:2A-5: “i. "Partnership agreement" means any valid agreement, written or oral, of the partners as to the affairs of a limited partnership and the conduct of its business. j. "Partnership interest" means a partner's share of the profits and losses of a limited partnership and the right to receive distributions of partnership assets.” (official text; accessed October 2, 2026).
• N.J.S.A. § 42:2A-5: “m. Unless otherwise provided in the partnership certificate or in the partnership agreement, "in interest" shall mean a vote or percentage of a limited partner (in a class of limited partners) equal to the portion that partner's share in contributions to the partnership bears to the share in contributions to the partnership of all limited partners (of that class).” (official text; accessed October 2, 2026).
• N.J.S.A. § 42:2A-12: “A partnership interest is personal property.” (official text; accessed October 2, 2026).
• N.J.S.A. § 42:2A-14: “g. Any power of a limited partner to grant the right to become a limited partner to an assignee of any part of his partnership interest, and the terms and conditions of the power;” (official text; accessed October 2, 2026).
• N.J.S.A. § 42:2A-16: “A certificate of limited partnership is amended by the filing of a written certificate of amendment thereto in the office of the Secretary of State which shall set forth: a. The name of the limited partnership; b. The date of filing of the original certificate; c. The amendment or amendments to the certificate of limited partnership; and d. The amendment or amendments shall take effect upon filing of the certificate of amendment in the office of the Secretary of State or at any time specified in the certificate of amendment not later than 30 days of the date of filing.” (official text; accessed October 2, 2026).
• N.J.S.A. § 42:2A-25: “After the filing of a limited partnership's original certificate of limited partnership, a person may be admitted as an additional limited partner: a. In the case of a person acquiring a partnership interest directly from the limited partnership, upon compliance with the partnership agreement or, if the partnership agreement does not so provide, upon the written consent of all partners; or b. In the case of an assignee of a partnership interest of a partner who has the power, as provided in section 48 of P.L. 1983, c. 489 (C. 42:2A-49), to grant the assignee the right to become a limited partner, upon the exercise of that power and compliance with any conditions limiting the grant or exercise of the power.” (official text; accessed October 2, 2026).
• N.J.S.A. § 42:2A-29: “A limited partner has the right to: a. Inspect and copy any of the partnership records required to be maintained by section 9 of P.L 1983, c. 489 (C. 42:2A-9); b. Obtain from the general partners from time to time upon reasonable demand true and full information regarding the state of the business and financial condition of the limited partnership; c. Receive promptly after becoming available, a copy of the limited partnership's federal, State and local income tax returns for each year; and d. Other information regarding the affairs of the limited partnership as is just and reasonable. Upon the reasonable request of any partner, the records set forth in this section shall be subject to inspection and copying at a reasonable cost by any partner during ordinary business hours.” (official text; accessed October 2, 2026).
• N.J.S.A. § 42:2A-47: “Except as provided in the partnership agreement, a partnership interest is assignable in whole or in part. An assignment of a partnership interest does not dissolve a limited partnership or entitle the assignee to become or to exercise any rights of a partner. An assignment entitles the assignee to receive, to the extent assigned, only the distribution to which the assignor would be entitled. Except as provided in the partnership agreement, a partner ceases to be a partner upon assignment of all his partnership interest. Notwithstanding the foregoing, a general partner who assigns all of his general partnership interest shall cease to be a general partner only upon the filing of a certificate reflecting that fact in accordance with this chapter.” (official text; accessed October 2, 2026).
• N.J.S.A. § 42:2A-49: “a. An assignee of a partnership interest, including an assignee of a general partner, may become a limited partner if and to the extent that the assignor gives the assignee that right in accordance with authority described in the certificate of limited partnership or all general partners and two-thirds in interest of the limited partners consent. b. An assignee who has become a limited partner has, to the extent assigned, the rights and powers, and is subject to the restrictions and liabilities, of a limited partner under the partnership agreement and this chapter. An assignee who becomes a limited partner also is liable for the obligations of his assignor. However, the assignee is not obligated for liabilities unknown to the assignee at the time he became a limited partner and which could not be ascertained from the certificate or agreement of limited partnership. c. If an assignee of a partnership interest becomes a limited partner, the assignor is not released from his liability to the limited partnership under sections 21 and 35 of P.L. 1983, c. 489 (C. 42:2A-22 and 42:2A-36).” (official text; accessed October 2, 2026).