1. The limited partners of a limited partnership private equity fund can only be composed of general partners and limited partners. According to the provisions of the Partnership Enterprise Law, a limited partnership enterprise is established by more than two partners and less than fifty partners, and consists of at least one general partner (GP) and one limited partner (LP).

2. The general partner (GP) generally refers to the management institution or natural person of the equity investment fund, and the general partner shall bear unlimited joint liability for the debts of the partnership. Limited partner (LP) does not carry out partnership affairs, nor does it represent the limited partnership externally, and is only liable for the debts of the partnership to the extent of its subscribed capital contribution.

3. At the same time, the Partnership Enterprise Law stipulates that a general partner may make capital contribution through labor services, and a limited partner may not make capital contribution through labor services. This provision clearly recognizes the value of the intellectual capital of the general partner as the manager, and embodies the advantages of the limited partnership system of "money and power". In operation, the limited partnership enterprise does not entrust the management company to manage the funds, but the general partner directly manages the assets and manages the enterprise affairs. The main advantages of adopting limited partnership system are:

(1) The property is independent of the personal property of each partner, so the rights and obligations of each partner are more clear and the incentive effect is better;

(2) Only the partners are taxed to avoid double taxation.