Limited partnership
In one sentenceA company with two classes of partners: general partners liable for its debts with all their assets, and limited partners liable only up to their shares.
Simply put
The general partner manages the company and bears its debts without limit, and the limited partner provides money and does not take part in its management toward third parties, so their liability is limited.
It suits someone who wants to fund a business run by others without bearing unlimited risk. If the limited partner takes part in management, they may be held liable like a general partner, as the law sets out.
Example
A craftsman runs a carpentry workshop, and an investor provides 300,000 SAR without working in it. They found a limited partnership: the craftsman is a general partner who manages and bears the debts, and the investor is a limited partner who cannot lose more than 300,000 SAR.
Don't confuse it with
General partnershipIn a general partnership there is no partner with limited liability, so all partners are liable for the debts with their personal assets.