When starting a new business, people often incorporate their company as a Delaware LLC or corporation. The state of Delaware has been a popular choice for incorporating because it is the state known for having the strongest corporate law structure in the country.
In other words, Delaware’s legal environment has repeatedly proven itself as the most advantageous to LLC and corporation owners. One of the reasons for this is the concept known as “the corporate veil.”
When your business is incorporated in Delaware, it is domestic to Delaware and foreign to every other state. You can operate your Delaware company in any other state once you have obtained the required permission from that state; this process is called Foreign Qualification.
The Foreign Qualification process is an important step; if you do not complete this step, your business may be not in compliance with that particular state.
Each state is different in regard to its procedures for registering as a foreign entity, so be sure you know exactly what a state requires before you file for Foreign Qualification for your Delaware company.
Utah, like most states, has an application process, a state fee and also requires additional documentation from Delaware. For Utah, the Foreign Qualification process is the same regardless of whether you will be registering a Delaware LLC or a Delaware corporation.
The document you receive in return from the Foreign Qualification process is called a Certificate of Authority. This is Utah’s way of giving your Delaware company the authority to operate in Utah.
In addition to Utah’s application, the state also requires a Certificate of Good Standing from Delaware. The Certificate of Good Standing does not have to be an original copy; however, it does need to be current within 90 days.
Utah also requires a Registered Agent with a physical address in Utah to be listed on the application. We offer this service in Utah for $99 per year.
Once you sign the application, we will file it with Utah’s Division of Corporations and Commercial Code, along with your company’s Certificate of Good Standing, on your behalf. Utah typically approves the documents in just a few business days.
Once your Delaware company is registered in Utah as a foreign entity, you will be responsible for Utah’s annual reporting requirements. The Utah annual report is due by the anniversary date of your Utah registration.
Utah generally mails a reminder of this reporting requirement to the Registered Agent on record. Please keep in mind that when registering your Delaware company as a foreign entity in Utah, you are still responsible for the Delaware annual fees as well. The reminders for the Delaware fees are sent to the Delaware Registered Agent.
If you have additional questions about registering your Delaware company as a foreign entity in Utah, or you are ready to get started, please call 1-800-345-2677, Ext. 6130.
THE AUTHOR OF THIS BLOG ARTICLE IS NOT A LAWYER AND HARVARD BUSINESS SERVICES, INC. IS NOT A LAW FIRM. THE ARTICLE ABOVE IS NOT INTENDED AS LEGAL ADVICE AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. THIS SHORT ARTICLE IS STRICTLY TO MENTION SOME ASPECTS OF DELAWARE’S CORPORATION LAWS AND/OR LAWS RELATING TO OTHER FORMS OF ENTITIES WHICH YOU MAY NOT BE FAMILIAR WITH. WE RECOMMEND THAT YOU CONSULT WITH A LAWYER BEFORE FORMULATING A STRATEGY WHICH WILL BE SUITABLE FOR YOUR SPECIFIC CASE.