Qualify To Do Business in The State of Florida
A corporation, limited liability company, limited partnership, limited liability partnership or limited liability limited partnership organized in another state cannot transact business in Florida unless it first registers with and receives approval from the Secretary of State.
Click Here To File a Certificate of Authority in Florida
The most common issue arising for foreign entities is whether in fact their activities in Florida qualify as doing or transacting business. Some entities establish permanent offices in Florida and employ several Florida workers, and thus they are without question doing business in the state. Others, however, may only complete a single transaction or project in Florida, or may never physically appear in the state, instead doing business by telephone and electronically. These latter circumstances often cause a business to inquire as to whether it must register.
The obligation to register as a foreign entity is determined on a case-by-case basis. This determination is not made by the Secretary of State, however, and is ultimately the decision of a court of law. As a practical matter, the obligation of a business to register is rarely heard by a court, and the entity’s decision of whether to register is often based upon the advice of an attorney who reviews past court decisions which examined particular circumstances.
Some foreign entities may fit within one of the specific exemptions from filing; many of the laws requiring a foreign entity to register identify specific activities, which are not considered to rise the level of “transacting business” in the state. Some of those activities include bringing or defending a lawsuit, maintaining bank accounts, borrowing money or taking a mortgage, or collecting debts. The exceptions also include conducting an isolated transaction completed within 30 days which will not be repeated in a similar nature.
Failure to properly register a foreign entity can lead to the revocation or unavailability of certain rights or privileges including the ability to maintain a lawsuit in the State. In addition, failure to file can lead to a civil fine or an injunctive action brought by the Secretary of State to restrain the further transaction of business.
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