The general partner is the person or entity — almost always a corporation — that manages a limited partnership fund's investments and daily business, and that carries unlimited liability for the fund's obligations in exchange for that control.
Canadian private equity and venture capital funds are almost always structured as limited partnerships registered under a provincial Limited Partnerships Act, with the general partner role held by a corporation rather than an individual, so the fund's principals hold their unlimited-liability exposure inside a company rather than personally. Where that GP entity is itself incorporated under the federal Canada Business Corporations Act, its board is subject to a residency rule: at least 25% of directors must be resident Canadians, or one director if the board has fewer than four — a real constraint for a GP entity a cross-border sponsor sets up on short notice.
The directors of that GP corporation also owe the corporation itself the ordinary CBCA duty, under section 122(1), to "act honestly and in good faith with a view to the best interests of the corporation" and to exercise "the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances" — a duty owed to the GP corporation itself, distinct from (though commercially aligned with) whatever the fund's own limited partnership agreement separately requires of the GP in managing the fund.
The GP, or an affiliated manager acting for it, is also the party soliciting limited partners' capital commitments, and that solicitation has to fit inside a prospectus exemption under National Instrument 45-106 — in practice almost always the accredited investor exemption, since a fund's limited partners are institutions and high-net-worth individuals rather than the retail public.
A layer of governance sits underneath the fund-level LPA and is easy to miss: the GP corporation is itself usually owned by the fund's principals, and where it is a CBCA corporation those principals commonly sign their own unanimous shareholder agreement under section 146 to fix how the GP corporation itself is controlled — who can bind it, how a departing principal's shares are bought out. Section 146 makes that agreement binding on a later purchaser of those GP shares even without notice — though if notice was not given, the purchaser may rescind within 30 days of learning the agreement exists — and lets the principals strip the board of some or all of its powers and take on the board's own liability in exchange. That USA governs the GP entity's ownership; it is a different document from, and sits below, the limited partnership agreement that governs the fund itself.
Maple Ridge Capital GP Inc., a CBCA corporation with three directors, at least one of whom is a Canadian resident to satisfy the under-four-directors rule, acts as general partner of Maple Ridge Capital Fund II, LP. It is the GP corporation, not its individual principals, that stands behind the fund's contractual obligations to its lenders and portfolio companies, while a separate unanimous shareholder agreement among the GP corporation's own three principals fixes what happens if one of them leaves before the fund's eight-year term is up.
See also: Limited partner · Limited partnership agreement · Independent sponsor.
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