For many years Delaware has been the popular choice when it comes to incorporating a company. Business owners from all over the world incorporate their companies in Delaware so they can take advantage of Delaware’s Corporate Law Structure, which is known to be the best in the world.
Regardless of whether you incorporate an LLC or a corporation, once your company is incorporated in Delaware, your business is domestic to Delaware and foreign to every other state. Foreign Qualification is the process in which your home state gives you the authority to operate there, under Delaware’s law structure.
If you fail to comply with local compliance issues, you may be putting the protection of your company at risk; thus, if you’d like to operate your Delaware company in the state of Ohio, you must file for Foreign Qualification in order to do so.
Ohio, like most states, requires an application process and a state fee in order for companies to foreign qualify there. For a Delaware corporation (not an LLC), Ohio also requires a Certificate of Good Standing from Delaware.
A Delaware Certificate of Good Standing is a document from the Secretary of State that certifies that a corporation is up to date on its Franchise Tax payments and operating in compliance. This is required for Delaware corporations that will be foreign qualifying in Ohio regardless of whether the business is new or not. The Certificate of Good Standing must be current within 90 days.
Ohio also requires Delaware companies to retain a Registered Agent in the state of Ohio. This is for the purpose of receiving service of process, legal documents and annual notices from Ohio.
Once you foreign qualify your Delaware company in Ohio, you will receive a Certificate of Authority. This document is the Delaware company’s proof that it now has the authority to operate in Ohio.
A Certificate of Authority is often a prerequisite for opening a bank account, obtaining a local business license and anything else customary to doing business in Ohio with your Delaware company.
If you have questions about operating in Ohio with your Delaware LLC or corporation, please call Harvard Business Services, Inc. at 1-800-345-2677 or email firstname.lastname@example.org.
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