California’s state legislature enacted or amended more than 30 sections in the Corporations Code and related Codes, including new requirements for directors from underrepresented communities and updated corporate naming conventions. These changes are captured in the 2021 Edition of California Laws Governing Business Entities Annotated, releasing this month from CSC®Publishing in collaboration with LexisNexis. Packed with helpful features and available as a softbound book or ebook, this resource is ideal for the home office.
The following provisions were among the changes coming from the 2020 legislative session:
- BUSINESS NAMES: The law governing naming conventions was changed to eliminate an exception that had previously allowed one corporation to adopt a name already used by another, even if the existing corporation gave its permission, and the public was unlikely to be misled. Similar exceptions to laws governing naming conventions for limited partnerships and limited liability companies were also approved, while another made domestic and foreign professional corporations subject to the naming requirements of the General Corporation Law.
- DIRECTORS: Corporations with five directors must have at least one director from an underrepresented community by the end of 2021. Any corporation with more than four but fewer than nine directors will be required to have at least two directors from underrepresented communities, while corporations with nine or more directors will need to have a minimum of 3 directors from underrepresented communities by the end of 2022. New legislation requires the Secretary of State to include the number of corporations in compliance with the new provisions requiring directors from underrepresented communities in published reports, and authorizes the Secretary to impose fines for violations of those provisions.
- FRANCHISE TAX: Starting this year and for the next four years, limited partnerships, limited liability partnerships, and limited liability companies that file, register, or organize to do business in California are exempt from paying the annual tax in their first taxable year.
- WAGES: California’s wage law was amended to require business entities to indicate on statements of information whether any officer or any director, or, in the case of a limited liability company, any member or any manager, has an outstanding final judgment issued by the Division of Labor Standards Enforcement or a court of law, for which no appeal therefrom is pending, for the violation of any wage order or provision of the Labor Code.
The 2021 Edition includes a Table of Sections Affected listing all legislative changes, as well as Blackline Amendment Notes that indicate exactly how the laws have changed. There is also an up-to-date California Fee Schedule showing required fees for business filings with the Secretary of State.
More than 50 new case notes from state and federal courts interpreting the law have been included in this edition, as well as four full-text cases discussing the latest legal developments regarding corporate answers to civil complaints, alter ego doctrine, derivative actions, and cryptocurrency. New cases are listed in the Table of New Annotations and marked with gray bars in the body of the book.
Readers also have online access to over 190 forms for incorporation/formation, qualification, mergers, dissolution, and name reservation for all business entity types via the Lexis Store download center. A listing of forms and contact information for the California Secretary of State can be found in the book’s appendix.
California Laws Governing Business Entities Annotated is available as a softbound book or as an ebook, compatible with dedicated e-reader devices, computers, tablets and smartphones that use e-reader software or applications. It is also available on the LexisNexis Digital Library.
To learn more about the 2021 Edition of California Laws Governing Business Entities, call 1.800.533.1637 or visit us online at www.lexisnexis.com/csc.
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