Partnership arrangements in Pakistan are governed by the Partnership Act 1932. In Pakistan many businesses are registered as partnerships. A partnership may be formed between two or more persons not exceeding twenty in number.

A partnership is formed by a deed of partnership on a Stamp paper worth Rs 1000, it may be registered with local area Firm Registrar but registration is not mandatory. Registration is required to protect one’s legal right should a dispute arise between partners otherwise in case of the firm is not registered with competent authority it will not be competent to sue for enforcement of right from contract except as regards suit or claim of set-off not exceeding Rs. 100.

Partnership has been defined under Section 4 of Partnership Act as

‘”Partnership” is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.
Persons who have entered into partnership with one another are called individually “partners” and collectively “a firm”, and the name under which their business is carried on is called the firm name”.