Document background
The Partnership Buy-Sell Agreement is an essential document for businesses operating as partnerships in Pakistan, providing a structured framework for handling ownership transitions. This agreement becomes particularly crucial when partners need to plan for future contingencies such as retirement, death, disability, or voluntary exit from the business. Governed by Pakistani law, particularly the Partnership Act 1932 and Contract Act 1872, the agreement includes comprehensive provisions for valuation methods, payment terms, transfer restrictions, and funding mechanisms. It helps prevent potential disputes and ensures business continuity by establishing clear procedures for ownership changes. The document typically includes insurance provisions, valuation formulas, and specific triggers that initiate the buy-sell process, making it a fundamental tool for risk management and succession planning in partnership businesses.
