What's happening
This bill eliminates newspaper publication requirements for LLCs and partnerships, replacing them with electronic publication on state websites and establishing a modernization fund.
Why it matters
Reduces startup and ongoing costs for small businesses and entrepreneurs. By eliminating expensive newspaper publication requirements for LLCs and partnerships, the bill removes a financial and procedural barrier that disproportionately affects new and small businesses, making it easier and more affordable to form and maintain these entities in New York.
Greatly increases public accessibility and transparency. Required business filings and notices will be published online, in fully searchable formats, on state-run websites. This means the public, investors, and government agencies can easily access up-to-date information about business entities without needing to hunt through local newspapers or pay for access.
Modernizes government infrastructure and security. The bill establishes a dedicated modernization fund, paid for by new (lower) electronic publication fees, to upgrade and secure the Department of State’s public-facing website—helping ensure that the shift to digital publication is both effective and secure.
Standardizes and speeds up notification processes. With electronic publication, notices and filings will be posted quickly and consistently statewide, reducing delays and variability between counties and removing uncertainty about compliance for business owners.
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Who cares
Headline styles
End LLC Newspaper Requirements
Plain English, a few words. Used as the page title.
Sponsors
2 Co-sponsors
History
- Referred to corporations, authorities and commissions
- Referred to corporations, authorities and commissions
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
End LLC Newspaper Notices
In Assembly Committee · Corporations, Authorities And Commissions · Sponsor Rebecca Seawright
Full text
8 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3361
2019-2020 Regular Sessions
IN SENATE
February 6, 2019
Introduced by Sens. KRUEGER, HOYLMAN, LIU -- read twice and ordered printed, and when printed to be committed to the Committee on Corporations, Authorities and Commissions
AN ACT to amend the limited liability company law and the partnership law, in relation to certain publication requirements and fees; to amend the state finance law, in relation to establishing the department of state modernization fund; to repeal subdivision (a-1) of section 102 and section 206 of the limited liability company law and subdivision (a-1) of section 121-101 of the partnership law, relating to affidavits of publication; to repeal subdivision (s) of section
1101 of the limited liability company law and subdivision (f) of section 121-1300 of the partnership law, relating to fees for filing certificates of publication; to repeal subdivision b of section 802, paragraph 2 of subdivision (c) of section 1203 and… Show allHide
1101 of the limited liability company law and subdivision (f) of section 121-1300 of the partnership law, relating to fees for filing certificates of publication; to repeal subdivision b of section 802, paragraph 2 of subdivision (c) of section 1203 and subdivision (d) of section 1206 of the limited liability company law and subdivision (c) of section 121-201, subdivision (d) of section 121-902, paragraph (II) of subdivision (a) of section 121-1500 and paragraph (II) of subdivision (f) of section 121-1502 of the partnership law, in relation to publication requirements; to repeal subdivision (e-1) of section 102 of the limited liability company law and subdivision (a-2) of section
121-101 of the partnership law, relating to certificates of publication; and to repeal subdivision 4 of section 23.03 of the arts and cultural affairs law, relating to theatrical production company publication requirements
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The opening paragraph of subdivision (e) of section 1006 of the limited liability company law, as amended by chapter 375 of the laws of 1998, is amended to read as follows:
In connection with any conversion approved under subdivision (c) of this section, the partnership or limited partnership shall file with the
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06563-02-9
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department of state a signed certificate entitled "Certificate of Conversion of ... (name partnership or limited partnership) to ... (name of limited liability company) under section one thousand six of the Limited Liability Company Law" [and shall also satisfy the publication requirements of section two hundred six of this chapter]. Such certificate shall include either:
§ 2. Section 206 of the limited liability company law is REPEALED.
§ 3. Subdivision (s) of section 1101 of the limited liability company law is REPEALED.
§ 4. Section 209 of the limited liability company law is amended to read as follows:
§ 209. Filing with the department of state. (a) A signed articles of organization and any signed certificate of amendment or other certificates filed pursuant to this chapter or of any judicial decree of amendment or cancellation shall be delivered to the department of state. If the instrument that is delivered to the department of state for filing complies as to form with the requirements of law and the filing fee required by any statute of this state in connection therewith has been paid, the instrument shall be filed and indexed by the department of state. The department of state shall not review such articles or certificates for legal sufficiency; its review shall be limited to determining that the form has been completed.
(b) The department of state shall make such instruments available on its state register website, and must maintain electronic copies of the instruments in a fully searchable format that is available to the public. The department of state shall also transmit a copy of such instrument to the department of law within seven days of filing. The department of law shall publish the instrument on its "NY Open Government" website or analogous website no more than seven days after receipt from the department of state.
(c) The department of state shall publish notice of article filings and any signed certificate of amendment or other certificates filed pursuant to this chapter on its state register website, which shall include without limitation: (1) the name of the limited liability company; (2) the date of filing of the articles of organization with the department of state and, if the date of the formation is not the date of filing of the articles of organization, the date of formation of the limited liability company; (3) the county within the state, in which the office of the limited liability company is located; (4) the street address of the principal business location, if any; (5) a statement that the secretary of state has been designated as agent of the limited liability company upon whom process against it may be served and the post office address within or without the state to which the secretary of state shall mail a copy of any process against it served upon him or her; (6) if the limited liability company is to have a registered agent, his or her name and address within the state and a statement that the registered agent is to be the agent of the limited liability company upon whom process against it may be served; (7) if the limited liability company is to have a specific date of dissolution in addition to the events of dissolution set forth in section seven hundred one of this chapter, the latest date upon which the limited liability company is to dissolve; and (8) the character or purpose of the business of such limited liability company.
§ 5. Subdivision (b) of section 802 of the limited liability law is REPEALED and a new subdivision (b) is added to read as follows:
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(b)(i) The department of state shall make such instruments available on its state register website, and must maintain electronic copies of the instruments in a fully searchable format that is available to the public. The department of state shall also transmit a copy of such instrument to the department of law within seven days of filing. The department of law shall publish the instrument on its "NY Open Government" website or analogous website no more than seven days after receipt from the department of state.
(ii) The department of state shall publish notice of article filings and any signed certificate of amendment or other certificates filed pursuant to this chapter on its state register website, which shall include without limitation: (1) the name of the foreign limited liability company; (2) the date of filing of the articles of organization with the department of state and, if the date of the formation is not the date of filing of the articles of organization, the date of formation of the foreign limited liability company; (3) the county within the state, in which the office of the foreign limited liability company is located; (4) the street address of the principal business location, if any; (5) a statement that the secretary of state has been designated as agent of the foreign limited liability company upon whom process against it may be served and the post office address within or without the state to which the secretary of state shall mail a copy of any process against it served upon him or her; (6) if the foreign limited liability company is to have a registered agent, his or her name and address within the state and a statement that the registered agent is to be the agent of the foreign limited liability company upon whom process against it may be served; (7) if the foreign limited liability company is to have a specific date of dissolution in addition to the events of dissolution set forth in section seven hundred one of this chapter, the latest date upon which the foreign limited liability company is to dissolve; and (8) the character or purpose of the business of such foreign limited liability company.
§ 6. Paragraph 2 of subdivision (c) of section 1203 of the limited liability law is REPEALED and a new paragraph 2 is added to read as follows:
(2) (A) The department of state shall make such instruments available on its state register website, and must maintain electronic copies of the instruments in a fully searchable format that is available to the public. The department of state shall also transmit a copy of such instrument to the department of law within seven days of filing. The department of law shall publish the instrument on its "NY Open Government" website or analogous website no more than seven days after receipt from the department of state.
(B) The department of state shall publish notice of article filings and any signed certificate of amendment or other certificates filed pursuant to this chapter on its state register website, which shall include without limitation: (1) the name of the professional service limited liability company; (2) the date of filing of the articles of organization with the department of state and, if the date of the formation is not the date of filing of the articles of organization, the date of formation of the professional service limited liability company; (3) the county within the state, in which the office of the professional service limited liability company is located; (4) the street address of the principal business location, if any; (5) a statement that the secretary of state has been designated as agent of the professional service limited liability company upon whom process against it may be served and
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the post office address within or without the state to which the secretary of state shall mail a copy of any process against it served upon him or her; (6) if the professional service limited liability company is to have a registered agent, his or her name and address within the state and a statement that the registered agent is to be the agent of the professional service limited liability company upon whom process against it may be served; (7) if the professional service limited liability company is to have a specific date of dissolution in addition to the events of dissolution set forth in section seven hundred one of this chapter, the latest date upon which the professional service limited liability company is to dissolve; and (8) the character or purpose of the business of such professional service limited liability company.
§ 7. Subdivision (d) of section 1306 of the limited liability law is REPEALED and a new subdivision (d) is added to read as follows:
(d)(i) The department of state shall make such instruments available on its state register website, and must maintain electronic copies of the instruments in a fully searchable format that is available to the public. The department of state shall also transmit a copy of such instrument to the department of law within seven days of filing. The department of law shall publish the instrument on its "NY Open Government" website or analogous website no more than seven days after receipt from the department of state.
(ii) The department of state shall publish notice of article filings and any signed certificate of amendment or other certificates filed pursuant to this chapter on its state register website, which shall include without limitation: (1) the name of the foreign professional service limited liability company; (2) the date of filing of the articles of organization with the department of state and, if the date of the formation is not the date of filing of the articles of organization, the date of formation of the foreign professional service limited liability company; (3) the county within the state, in which the office of the foreign professional service limited liability company is located; (4) the street address of the principal business location, if any; (5) a statement that the secretary of state has been designated as agent of the foreign professional service limited liability company upon whom process against it may be served and the post office address within or without the state to which the secretary of state shall mail a copy of any process against it served upon him or her; (6) if the foreign professional service limited liability company is to have a registered agent, his or her name and address within the state and a statement that the registered agent is to be the agent of the foreign professional service limited liability company upon whom process against it may be served; (7) if the foreign professional service limited liability company is to have a specific date of dissolution in addition to the events of dissolution set forth in section seven hundred one of this chapter, the latest date upon which the foreign professional service limited liability company is to dissolve; and (8) the character or purpose of the business of such foreign professional service limited liability company.
§ 8. Section 1101 of the limited liability company law is amended by adding a new subdivision (w) to read as follows:
(w) For the electronic publication of any documents required to be filed with the department pursuant to section two hundred nine, eight hundred two, twelve hundred three or thirteen hundred six of this chapter, fifty dollars.
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§ 9. Subdivisions (a-1) and (e-1) of section 102 of the limited liability company law are REPEALED.
§ 10. Subdivision (c) of section 121-201 of the partnership law is REPEALED and a new subdivision (c) is added to read as follows:
(c)(i) The department of state shall make such instruments available on its state register website, and must maintain electronic copies of the instruments in a fully searchable format that is available to the public. The department of state shall also transmit a copy of such instrument to the department of law within seven days of filing. The department of law shall publish the instrument on its "NY Open Government" website or analogous website no more than seven days after receipt from the department of state.
(ii) The department of state shall publish notice of article filings and any signed certificate of amendment or other certificates filed pursuant to this chapter on its state register website, which shall include without limitation: (1) the name of the limited partnership; (2) the date of filing of the articles of organization with the department of state and, if the date of the formation is not the date of filing of the articles of organization, the date of formation of the limited partnership; (3) the county within the state, in which the office of the limited partnership is located; (4) the street address of the principal business location, if any; (5) a statement that the secretary of state has been designated as agent of the limited partnership upon whom process against it may be served and the post office address within or without the state to which the secretary of state shall mail a copy of any process against it served upon him or her; (6) if the limited partnership is to have a registered agent, his or her name and address within the state and a statement that the registered agent is to be the agent of the limited partnership upon whom process against it may be served; (7) if the limited partnership is to have a specific date of dissolution in addition to the events of dissolution set forth in article six of this chapter, the latest date upon which the limited partnership is to dissolve; and (8) the character or purpose of the business of such limited partnership.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the limited liability company law and the partnership law, in relation to certain publication requirements and fees; to amend the state finance law, in relation to establishing the department of state modernization fund; to repeal subdivision (a-1) of section 102 and section 206 of the limited liability company law and subdivision (a-1) of section 121-101 of the partnership law, relating to affidavits of publication; to repeal subdivision (s) of section 1101 of the limited liability company law and subdivision (f) of section 121-1300 of the partnership law, relating to fees for filing certif- icates of publication; to repeal subdivision b of section 802, paragraph 2 of subdivision (c) of section 1203 and subdivision (d) of section 1206 of the limited liability company law and subdivision (c) of section 121-201, subdivision (d) of section 121-902, paragraph (II) of subdivi- sion (a) of section 121-1500 and paragraph (II) of subdivision (f) of section 121-1502 of the partnership law, in relation to publication requirements; to repeal subdivision (e-1) of section 102 of the limited liability company law and subdivision (a-2) of section 121-101 of the partnership law, relating to certificates of publication; and to repeal subdivision 4 of section 23.03 of the arts and cultural affairs law, relating to theatrical production company publication requirements
Purpose or general idea of bill
Repeals publication requirements of articles of organization under the limited liabilities and partnership laws and creates an online filing requirement with the department of state with additional online disclo- sure of limited liability company and partnership filings
Summary of specific provisions
Removes the publication requirements for conversions of partnerships or limited partnerships to limited liability corporations and eliminates the filing fees for the affidavits of publication.
Read the full memo (796 words)
Repeals sections of the limited liability company law in relation to the publication requirements for articles of organization of limited liabil- ity companies, foreign limited liability companies, professional service limited liability companies and foreign professional service limited liability companies.
Repeals sections of the partnership law in relation to the publication requirements for articles of organization of limited partnerships and limited liability partnerships, foreign limited liability companies, professional service limited liability companies and foreign profes- sional service limited liability companies.
Amends section 1203 of the limited liability company law to remove these requirements for professional services limited liability companies.
Requires that department of state promulgate rules and regulations for the on-line filing of articles and certificates and establishes stand- ards for electronic access to limited liability company and partnership filings.
Establishes a fee of $50.00 for the on-line filing of documents with the department of state and establishes a fund to provide for modernization of Department of State online resources.
Justification
The intent of the Legislature when enacting the LLC Law in 1994 was to allow businesses to enjoy the advantages of incorporation, without requiring them to adopt the organizational constraints of the business corporation law. This was intended to be particularly useful for small businesses.
The LLC and the Partnership Laws require that after the articles of organization have been filed, the LLC must publish a copy of the arti- cles or a notice of their substance, once a week, for six consecutive weeks, in two newspapers designated by the county clerk from the county where the LLC is located. The LLC or partnership is then required to file affidavits of publication within 120 days and pay an additional fee of $50.00. These requirements are both unnecessary and very expensive - sometimes prohibitively so, as the designated newspapers have an effec- tive monopoly in setting the charges for notices. Also, there are no similar requirements in the Business Corporation Law.
The transparency that publishing this information allows can be better achieved today through the internet. Indeed, the Department of State already maintains an excellent publicly-accessible online database. However, current law does not require electronic access to articles of organization or specify other information that must be provided online.
Passage of this legislation would remove onerous and unnecessary requirements on LLCs and partnerships forming in New York state while improving public access to information about LLCs. It is extraordinarily difficult to find published information when or after it appears in print in a daily or weekly local print publication. Online filings will improve a citizen's access-to this information.
Prior legislative history
A.11287/S.8381 of 2008. A.4496/S.1667 of 2009-2010 A.885/S.437 of 2011-2012 S3259/A942 2013-14 2015-2016: S.4274 A.8125/S.3360 of 2017-2018
Fiscal implications
None
Effective date
This act shall take effect on the one hundred eightieth day after it shall have become law, provided, however that effective immediately the department of state is directed and authorized to promulgate all rules and regulations necessary to implement the provisions of this act on or before its effective date.
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