NCR’s International Due Diligence CLE Seminar in Los Angeles on May 7th
Updated April 22, 2014
National Corporate Research, Ltd. (NCR) will be presenting a free CLE seminar, “’When in Rome…’ Understanding Due Diligence Requirements for International Transactions” on Wednesday, May 7th, in downtown Los Angeles.
The seminar covers three key pieces of documentation, normally obtained from the public record in the U.S.:
- Good Standing Certificates
- Certified copies of formation documents, and
- UCC lien search results
We’ll review the role these documents play in the due diligence process in the U.S. and will look at the variations and equivalents to them in countries around the world.
The seminar will be held at the Los Angeles Athletic Club and will run from 9:30 AM to 11:00 AM, with a continental breakfast beginning at 9:00 AM.
This course has been approved by the California State Bar for 1.5 Minimum Continuing Legal Education (MCLE) credit hours and by the National Association of Legal Assistants (NALA) for 1.5 CLE credits.
While there is no fee to attend the seminar, advance registration is required. Since space is limited, we will accept registrations on a “first come, first served” basis. If you work on international transactions, you won’t want to miss this program so register now!
Click here for more details about the seminar and to access the registration form.
Delaware Increases Franchise Tax and Annual Tax
Updated April 22, 2014
On April 15, 2014, Delaware Governor Jack Markell signed House Bill No. 265, as amended by House Amendment Numbers 1 and 3, into law. The bill increases the annual tax paid by alternative entities and the minimum corporation franchise tax. While the legislation has a retroactive effective date of January 1, 2014, the Delaware Division of Corporations has announced that they will delay the enforcement of the new tax rates until July 1, 2014.
For most filers, the increase will have no effect until 2015 when they pay their 2014 taxes. However, entities that are dissolving, cancelling, converting or merging out of existence in 2014 must pay their taxes up to the date of filing. The 2014 tax that must be paid prior to filing will be based on the current (old) rates through June 30, 2014. The new rates will be applicable starting July 1, 2014.
To view our chart comparing the old and new rates, click here.
To view the full text of House Bill 265, as amended, click here.
If you have questions, feel free to contact your NCR corporate specialist.
Three New Types of Filings in Delaware
Updated March 27, 2014
Effective April 1, 2014, the Delaware Division of Corporations will begin accepting three new types of filings:
- Certificate of Validation
- Certificate of Reinstatement
- Application for Reinstatement of Statement of Qualification
For more details on each type, view NCR's recent blog post on this topic.
Holiday Closings for April and May 2014
Updated March 19, 2014
To assist you in planning closing dates and avoiding surprises, National Corporate Research, Ltd. (NCR) has compiled a list of U.S. state holiday closings for April and May 2014. To download the list in PDF format, click here .
For clients who work on international transactions, we have also compiled a list of corporate registry holiday closures in select countries. To access our international list of holiday closings for April and May, click here .
Please note that some jurisdictions declare holidays at the last minute. So if a particular filing date is important to you, contact your NCR service specialist and we will double check at that time to ensure the filing office will be open on the date you are interested in. Also note that as we become aware of any changes to the holiday closing lists, we will post updated versions of the lists to this page of our website.
If you have any questions, feel free to contact your NCR service specialist.
Puerto Rico Clarifies Effective Period for UCCs is Five Years
Updated March 12, 2014
Puerto Rico’s Law No. 17-2014, which became effective on January 16, 2014, amended, among other items, Section 9-515(a) of Article 9 (“Chapter 9, Secured Transactions”) to reduce the life of an initial Uniform Commercial Code (UCC) financing statement from ten years to five years. Due to some drafting errors in Puerto Rico’s prior enactment of Revised Article 9, there had been confusion as to whether the effective period was five years or ten years.
Drafting Errors in Prior Enactment of Revised Article 9
Some drafting errors in Puerto Rico’s enactment of Revised Article 9 and the 2010 Amendments with Law 21-2012, effective January 17, 2013, caused confusion regarding the effective period of financing statements. While Section 9-515(a) clearly indicated that a filed financing statement “is effective for a period of ten years after the date of filing”, the heading for this section is “Five-year effectiveness”. And, Section 9-515(d) refers to the six-month continuation window “before the expiration of the five-year period.” Section 9-515(e) clearly indicates that continuation filings extend the life of the financing statement for five years from the lapse date.
Puerto Rico Department of State Issues Memo to Clarify Effect of Law No. 17-2014
On January 24, 2014, the Puerto Rico Department of State issued a memo to clarify the term of initial financing statements and the effect of continuation filings. The memo makes it clear that the correction to the law effective January 16, 2014 has no retroactive effect. Therefore, UCC1s filed in Puerto Rico on or after January 16, 2014 get a five-year life and those filed on or before January 15, 2014, have a ten-year life. However, continuations filed on or after January 17, 2013 (the date Revised Article 9 and the Article 9 amendments became effective in Puerto Rico) extend the life of the filing for FIVE YEARS from the lapse date. Secured lenders will need to adjust their tickler systems accordingly.
Note that the January 24, 2014 memo from the Puerto Rico Department of State was issued only in Spanish. To view the memo, click here. Note that National Corporate Research, Ltd. has also provided a unofficial English translation at the end of the memo.
To view Puerto Rico Law 17-2014 (also in Spanish followed by an unofficial English translation), click here.
Important Note About UCC Forms in Puerto Rico
We thought it would be helpful to advise or remind those who file UCCs in Puerto Rico that despite PR’s enactment of Revised Article 9 and the 2010 Amendments that became effective on January 17, 2013, Puerto Rico is still requiring signatures on UCC filings. We suggest using the national versions of the UCC forms that have the revision date of 12/18/95, since these include the signature blocks. Note that the signatures don’t have to be original – scanned/PDF copies will be accepted.
D.C. to Require Old Act Nonprofits and Act of Congress Corporations to Register and File Biennial Reports
Updated December 9, 2013
On November 15, 2013, the D.C. Department of Consumer and Regulatory Affairs (DCRA) announced that Old Act Nonprofit Corporations (nonprofit corporations formed before 1/1/1963) and Act of Congress Corporations (corporations incorporated under the Act of Congress) conducting business in the District of Columbia will be required to register and start filing biennial reports by January 1, 2014, pursuant to D.C. Code § 29-107.01. (b) and D.C. Municipal Regulations Chapter 17 Section 7-704 and 7-705. (Click here to view announcement on DCRA website.)
Requirements Effective January 1, 2014:
Old Act Nonprofit Corporations have three options to comply with the new requirements:
• Option 1 – OPTING IN: By 1/1/2014, Old Act Nonprofit Corporations that want to come under the provisions of Title 29 Chapter 3 will be required to file a copy of their original articles of incorporation or restated articles and board resolution accepting the new law.
• Option 2 – OPTING OUT: By 4/1/2014, Old Act Nonprofit Corporations that do not want to accept the new law will have to file their first biennial report along with copy of original articles and board resolution not accepting the new law.
• Option 3 – NO ACTION: By 9/1/2014, Old Act Nonprofit Corporations that have not exercised either Option 1 or Option 2 will be administratively dissolved and will need to reinstate and pay back fees. At that point acceptance of the law will be mandatory.
Act of Congress Corporations have two options:
• Option 1 – OPTING IN: By 1/1/2014, Act of Congress Corporations that want to come under provisions of Title 29 Chapter 3 and renounce congressional charter can file a copy of their federal articles of incorporation and all amendments, board resolution accepting the new law and restated articles of incorporation.
• Option 2 – OPTING OUT: By 1/1/2014, Act of Congress Corporations conducting business in D.C. that do not wish to exercise Option 1 will be required to file Registration Statement Form GN-16 including the following: corporation’s name, date of organization, principal address, name and address of at least one governor, name and address of its registered agent and a copy of its congressional charter and any amendments.
Post 2014 Requirements:
Both entity types will be required to file biennial reports by 4/1/2014, regardless of the options exercised, and subsequent reports are required every two years by April 1st. Failure to file a report may subject Old Act Nonprofit Corporations and Act of Congress Corporations to administrative dissolution and reinstatement provisions.