67Circumstances in which limited partner not regarded as taking

67 Circumstances in which limited partner not regarded as taking part in management (1) For section 66, the limited partner must not be regarded as taking part in managing the partnership's business only because one or more of subsections (2) to (12) apply. (2) This subsection applies if the partner is employed or engaged by: (a) the partnership; or (b) a general partner in the partnership; or (c) an associate of a general partner in the partnership. (3) This subsection applies if the partner: (a) gives advice to or for any of the following entities: (i) the partnership; (ii) a general partner in the partnership; (iii) an associate of a general partner in the partnership; and (b) the advice is given in the proper performance of functions arising: (i) from the engagement of the partner in a professional capacity; or (ii) from business dealings between the partner and an entity referred to in paragraph (a). (4) This subsection applies if the partner gives a guarantee or indemnity in relation to a liability of: (a) the partnership; or (b) a general partner in the partnership; or Part 3 Incorporated limited partnerships Division 3 Powers and liabilities of partnership Partnership Act 1997 32 (c) an associate of a general partner in the partnership. (5) This subsection applies if the partner takes any action, or participates in any action taken by other limited partners, for the purposes of: (a) enforcing the limited partner's rights as the limited partner; or (b) safeguarding the limited partner's interests as the limited partner. (6) This subsection applies if the partner exercises a power under the partnership agreement for: (a) a meeting of the partnership; or (b) a resolution of some or all of the partners in the partnership. (7) This subsection applies if the partner exercises a power referred to in section 66(2)(a), (b) or (c) under that section. (8) This subsection applies if the partner: (a) advises or consults with an associate of the partnership; or (b) is, or acts as, an officer, director, security holder, partner, agent or representative of an associate of the partnership; or (c) is, or acts as, a person employed or engaged by an associate of the partnership; or (d) is, or acts as, a lender to, or fiduciary for, an associate of the partnership. (9) This subsection applies if the partner, as authorised by the partnership agreement: (a) participates in, or has or exercises a right in relation to, the appointment, removal or nomination of a person as a member of a committee; and (b) the committee has functions that relate to one or more of the following proposals from a general partner in the partnership: (i) a proposal involving a material change in the nature of the partnership's business (including a change in any investment guidelines, policies or conditions relating to the business); Part 3 Incorporated limited partnerships Division 3 Powers and liabilities of partnership Partnership Act 1997 33 (ii) a proposal for the adoption of a method for valuing some or all of the partnership's assets (including any changes to the existing method); (iii) a proposal for an extension or reduction in the period in which, under the partnership agreement, an investment can be made by the partnership; (iv) a proposal for an approval or disapproval of an investment that the partnership does not otherwise have a right to make; (v) a proposal for an actual or potential transaction or anything else involving an actual or potential conflict of interest; (vi) a proposal relating to an actual or potential transaction, contract, arrangement or understanding between one or more partners in the partnership (or any of their associates) and the partnership or a general partner in the partnership (or any of their associates); (vii) a proposal for the delegation, waiver, release or variation of an authority, right, duty or obligation of the general partner; (viii) a proposal for the appointment, or approval under the partnership agreement, of anyone as a senior executive of the general partner or an associate of the general partner. (10) This subsection applies if the partner: (a) nominates, selects, investigates, evaluates or negotiates with anyone in relation to the removal or replacement of a general partner in the partnership; or (b) participates in the work of a committee that relates to the nomination, selection, appointment, change in control or ownership, suspension, replacement or removal of: (i) a general partner in the partnership; or (ii) an associate of a general partner in the partnership. (11) This subsection applies if the partner takes, or participates in, an action for the registration, or maintaining the registration, of the partnership or a general partner in the partnership as a VCLP or AFOF. Part 3 Incorporated limited partnerships Division 3 Powers and liabilities of partnership Partnership Act 1997 34 (12) This subsection applies if: (a) the partnership is a VCMP; and (b) the partner takes any action for the partnership in the capacity of a partner, or an associate of a partner, in the VCMP. (13) This section does not imply that the limited partner must be regarded as taking part in managing the partnership's business if: (a) the partner does anything in relation to the conduct of that business; and (b) none of subsections (2) to (12) applies. (14) The operation of this section must not be varied: (a) by the partnership agreement; or (b) with the consent of the partners in the partnership (whether or not given under the partnership agreement). (15) For this section, a reference to the limited partner includes a reference to a person acting for the limited partner.