These bodies do not have a separate legal entity, therefore the sole proprietor or partners are personally liable for the debts and liabilities of the business. In the case of limited partnerships (which are rare), liability is limited for only some of the partners.

Nature and key conditions of a partnerships/sole proprietorship

Liability	-	The sole proprietor or partners have unlimited liability for the debts and liabilities of the business ie their personal assets could be at risk.
Partnerships	-	Unlike corporate vehicles, partnerships do not have continual existence and the maximum number of partners allowed is usually 20. Partnerships are usually governed by a partnership agreement; if an agreement is not in place, the partnership legislation is deemed to apply.
Tax	-	Tax treatments differ between corporate vehicles and partnerships/sole proprietorships.
Ongoing compliance	-	Ongoing requirements are less onerous for partnerships/sole proprietorships than for corporate vehicles.

Process and cost of establishing a partnerships/sole proprietorship

Step 1 - within one month, submit application and fee for Business Registration Certificate (cost HK $2,600 for one year) (click here for more).

Since no further registration, filing or procedures are required, a partnership is quick and cheap to form.