Foreign Limited Partnerships in Delaware: Registration and Annual Tax

Delaware calls a limited partnership formed in any other state, territory or country a foreign limited partnership. Subchapter IX of the Delaware Revised Uniform Limited Partnership Act deals with it, and section 17-902 sets the central rule: registration with the Secretary of State comes first, doing business second. The Division of Corporations in Dover handles the filing.

Registration does not move the partnership's legal home. Section 17-901 keeps the home law in charge of how the partnership is organized, how its internal affairs run and how far its limited partners are liable. It also bars Delaware from refusing a registration merely because its own statute reads differently. Think of registration as a license to operate here, and nothing more.

No Delaware statute defines doing business for a limited partnership. Section 17-912(a) takes the opposite approach and names activities that do not count, using the word include, so the list is illustrative rather than complete:

• Handling litigation or negotiating a settlement
• Partner meetings and other matters concerning only the partnership's internal affairs
• Holding a bank account
• Running a transfer office for the partnership's own interests, or naming trustees or depositories for them
• Using independent contractors to sell
• Taking orders that become binding only when accepted outside Delaware
• Selling machinery or plants under a contract signed outside Delaware, with only installation supervision performed here
• Lending or borrowing, with or without a mortgage or other security
• Chasing debts and foreclosing on security, then holding and looking after what the partnership takes back
• A single isolated transaction that stands apart from routine business
• Interstate commerce
• Operating as an insurer

Two more rules appear in the same section. A person is not doing business here only because that person is a partner, and the list is no guide to questions of taxation, regulation or service of process under other laws. Property ownership is absent from the list, so nothing confirms it as harmless and nothing calls it a trigger. An office, local staff or recurring customers are different: they point to registration. If your facts sit between the two, talk to a Delaware attorney.

The paperwork is the Certificate of Registration for foreign limited partnerships. On the Division's limited partnership forms page it appears under the label foreign qualification, and it is a template without a form number. Delaware's fee is $200 under section 17-1107. Extras are optional: $50 buys a certified copy, $100 buys same-day handling and $50 buys 24-hour handling.

You can upload the signed document using the Division's online submission option, called Document Filing and Certificate Request, which only collects documents. It neither totals the fees nor charges them until the order is processed. The alternative is the mail, addressed to 401 Federal Street, Suite 4, Dover. Checks are made out to the Delaware Secretary of State.

What goes in the certificate

• The name for use in Delaware, with the home-state name in parentheses when the two differ
• Where and when the partnership was formed, with a statement that it validly exists under that law today
• A specific description of the business it will carry on here, because a general purpose statement is not accepted
• The agent's name and the Delaware street address of the registered office
• A built-in appointment of the Secretary of State as a backup agent for process under section 17-910(b), requiring nothing from you
• Every general partner's name and address
• The date the partnership started, or intends to start, business in Delaware

A general partner signs the certificate.

Delaware requires one. Evidence that the partnership is still alive at home has to travel with the registration, and section 17-902(2) says what counts: a certificate from an authorized officer of the jurisdiction of formation. The date on that certificate must fall within the six months before the day you file in Delaware. A translation, sworn by the translator, is attached if the original is not in English.

Your home filing office issues it and fixes its own price and turnaround. Because the six months run from the issue date, request the certificate close to your filing date and replace it if the paperwork sits longer than expected.

The name on a Delaware registration can differ from the home name, but it has to contain Limited Partnership, L.P. or LP, and it has to be one a Delaware limited partnership could use. When it is too close to another entity on the Division's index, the other entity can sign a written consent that you file with the registration.

Choosing an agent

Delaware wants a registered office, which need not double as a place where you operate, and an agent located at that address. Section 17-904(b) permits a Delaware-resident individual, a Delaware LLC, corporation, partnership or statutory trust, or a foreign corporation, LLP, limited partnership, LLC or statutory trust. It carves out the registering partnership itself. A foreign entity serving as agent also must hold authority to transact business in Delaware.

Section 17-104(e) adds practical limits. A company serving as agent needs a Delaware office with generally open access, while a person serving must be reliably present at a fixed place, frequently enough to accept service. Relying solely on a virtual office or a forwarding mailbox will not do. Swapping agents later is a short amendment, and the Division lists it at $50.

Delaware asks a registered foreign limited partnership for no annual report. It collects a flat tax of $400 under section 17-1109 instead. The first payment falls on the June 1 that follows the year you registered, the same date repeats every year, and nothing is prorated, so a partnership that registers in December still owes the full amount. The Secretary of State mails the statement to the registered agent no later than 60 days before the date, which makes the agent's mail handling matter.

Paying late adds $200 and interest of 1.5% a month. An unpaid tax means the partnership ceases to be registered and cannot maintain a lawsuit in Delaware until it pays the tax, penalties and interest. When payments are three months behind, the Attorney General may ask the Court of Chancery for an injunction against doing business.

Corrections, changes and cancellation

• A false or outdated statement in the registration is fixed by a correcting certificate under section 17-905, filed with a $200 fee.
• To end the registration, a person authorized to sign for the partnership files a certificate of cancellation. The fee is $200, and that year's annual tax must be paid before the certificate is filed.
• A limited liability limited partnership is priced per partner on the fee schedule, so verify the amounts with the Division if that is your structure.

Sections 17-907, 17-908 and 17-911 describe what follows.

• Courts. Until it registers and settles every fee and penalty for the years it operated without registration, the partnership cannot bring an action, suit or proceeding in Delaware.
• Fine. The penalty is $200 for every year, even a partial one, spent doing business unregistered.
• Contracts. Nothing in the failure to register cancels a contract or act, a counterparty can still enforce its contract, and the partnership may defend itself in court.
• Limited partners. Limited partners keep their limited status even though the partnership operated here unregistered.
• Court of Chancery. The Attorney General can ask the Court of Chancery to stop the partnership from doing business. Meanwhile, the default agent for lawsuits over its Delaware business is the Secretary of State.

The foreign qualification checkout at Mainstay Filing registers LLCs and for-profit corporations, so a limited partnership prepares its own Delaware registration or hands it to an attorney. The part Mainstay Filing sells to a limited partnership is the registered agent. It costs $149 per year, at the same price on every renewal. The Delaware address Mainstay Filing supplies is the one printed on the registration and kept in the public file.

The agent uploads court papers to your online account within the same business day and charges nothing for it, and the first three government letters of the year are scanned free too. A partnership that already has a different agent on record can have Mainstay Filing file the substitution, paying only the state's change fee. Mainstay Filing's agent is a company, which section 17-904(b) permits. Mainstay Filing isn't a law firm. See the Delaware registered agent page for the details.