200,000 New Delaware Companies in 2017
By Brett Melson
Tuesday, August 28, 2018
The State of Delaware’s 2017 Annual report from the Delaware Division of Corporations has been released and the report reaffirms why attorneys, accountants and business professionals from all around the world continue to use Delaware for their corporation filings. The Division’s 2017 Annual Report discusses key highlights, new developments, and updates to Delaware Corporate law:
- 66.8% of the Fortune 500 companies are incorporated in Delaware
- Over 1,300,000 entities are currently in existence in Delaware
- 80% of the Initial Public Offerings in 2017 were Delaware companies
- Almost 200,000 new Corporations, Limited Liability Companies, Limited Partnerships, Limited Liability Partnerships, and Trusts were created in Delaware during 2017, up 9.5% from 2016
- There were 143,996 new LLC’s formed in 2017, an increase of 11.7% from 2016
- LLC’s accounted for 72.5 percent of all the formations
- 41,553 new Corporations were formed in 2017, an increase of 3.2% over the previous year
- Limited Partnership formations increased to 11,517, an increase of 11.4%
Some of the notable changes to Delaware Corporate Law:
- Limited Liability Companies, Limited Partnerships and Corporations are all allowed to keep records in the electronic networks and databases, otherwise known as Blockchain. Blockchain is a digital ledger technology in which transactions are recorded across many computers worldwide. The recorded transactions cannot be changed after the fact. Using blockchain technology to maintain your Membership Schedule and/or Capitalization Table will ensure the accuracy of ownership transaction details.
- The Creation of a Certificate of Division, allowing an LLC formed in Delaware to split into separate LLC’s: we will expand on this in a later blog post.
- Delaware now allows for the Public Benefit LLC, which is like the Public Benefit Corporation that Delaware created in 2013, but with the management and ownership structure of the LLC. A Public Benefit LLC requires a public benefit statement listed on the Certificate of Formation.
The Division of Corporations is the most important source of income for the tiny State of Delaware. The total revenue from franchise taxes, formation fees, Certified Copies of filings, Certificates of Good Standings and Uniform Commercial Code filings accounted for a staggering $1.1 Billion in the 2017-2018 fiscal year ending June 30th. Staying on top of trends and keeping the laws on the cutting edge of the industry is why Delaware remains the “Corporation Capital of the World.”
Source: Delaware Division of Corporations Annual Report 2017
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.