Out-of-State Corporations in Florida: Applying for Authority to Transact Business

Florida labels as foreign any corporation chartered somewhere else, whether in another state or in another country. Section 607.1501 of the Florida Business Corporation Act bars a foreign corporation from transacting business here before the Department of State has granted authority, and the proof of that authority is a certificate of authority issued through the Division of Corporations (Sunbiz). The form is the Application by Foreign Corporation for Authorization to Transact Business in Florida, numbered CR2E007.

The certificate does not move the corporation's legal home. Section 607.15015 leaves how the corporation is organized, how it runs its internal affairs and what its shareholders can be held liable for to the home jurisdiction's law, and it bars Florida from denying the certificate merely because that law differs. The corporation also gains no power that a Florida corporation would lack.

Florida does not define transacting business. Section 607.1501(2) instead lists activities that, among others, do not count, and subsection (3) confirms that the list is not complete:

• Handling, mediating, arbitrating or settling a proceeding
• Meetings of the board or shareholders and other housekeeping
• Keeping accounts at financial institutions
• Running offices that transfer and register the corporation's own securities, or using trustees and depositaries for them
• Selling through independent contractors
• Soliciting orders that do not bind until accepted somewhere outside Florida
• Borrowing, lending or taking mortgages and security interests
• Collecting debts, enforcing security, and holding or protecting the property recovered
• Interstate commerce
• One isolated deal completed inside 30 days, outside any pattern of repeated like deals
• Owning and controlling a subsidiary or voting shares in one
• Owning a limited partnership interest without managing the partnership
• Owning, protecting and maintaining real or personal property without more

The final item matters to out-of-state owners. For a corporation, property held without more is on the safe list, and chapter 607 does not contain the income-producing property rule that the statutes for partnerships do. A corporation with an office, employees or a steady course of business in Florida is plainly transacting business. In a close case, ask a Florida attorney before deciding to skip the filing, because the list does not decide service of process, taxation or other regulation.

The Division's total for a foreign profit corporation is $70: $35 to file plus $35 to designate the registered agent. Optional extras are a certified copy of the application and a certificate of status, $8.75 each. One check covers everything and is payable to the Florida Department of State.

There is no online option for this application. You mail the completed form, the original certificate of existence and the check, with the Division's cover letter, to the Registration Section, P.O. Box 6327, Tallahassee. A courier can deliver to The Centre of Tallahassee, 2415 N. Monroe Street, Suite 810. The cover letter includes an email address that the Division later uses for annual report reminders.

What the application asks for

• The corporation's name with a corporate suffix, plus a substitute name for Florida use when the true name cannot be used
• The state or country of incorporation, the FEI number if there is one, the date of incorporation and any fixed duration
• When the corporation began transacting business here, if that predates registration, because penalties are measured from that date
• The principal office street address and the mailing address
• A Florida street address and name for the registered agent, together with that agent's signed acceptance of the appointment
• Up to six officers and directors with their titles and addresses
• A signature from an officer or director, given under a warning about the felony penalty for false filings

Florida requires one. Section 607.1503(2) wants proof that the corporation exists, either an existence certificate or comparable official proof signed by the home jurisdiction's records custodian, and it must carry an authentication date within 90 days of delivery to Tallahassee. The Division's instructions go further than the statute by asking for an original and stating that a photocopy is not acceptable. Anything not in English needs a translator's sworn translation.

The owner orders it from the home jurisdiction, which sets the price. Because the 90 days run toward delivery in Tallahassee, allow for the mail or courier time when you decide when to order.

Florida requires every authorized foreign corporation to maintain a local registered office plus a registered agent located at that address (section 607.1507). Eligible agents are a Florida-resident individual, a Florida entity of an approved type, or another foreign entity of an approved type that is authorized to transact business in Florida. The approved types are a for-profit corporation, an LLC, an LLP and an LP. The wording speaks of another foreign entity, so the applicant corporation cannot name itself. A P.O. box is not accepted, and the agent signs a written acceptance of the role.

Hours and duties

A separate statute, section 48.091, requires the registered office to be open from at least 10 a.m. to noon and from 2 p.m. to 4 p.m. on every day except Saturdays, Sundays and legal holidays, with someone present on whom process can be served. The agent's statutory duty is to forward to the corporation any process, notice or demand it receives. Changing the agent is a statement of change that costs $35.

Each year, from January 1 through May 1, the corporation files its annual report electronically. The first one falls due in the calendar year after authority is granted. The fee is $150, which includes the $88.75 supplemental corporate fee. Arriving after May 1 triggers an added $400 late charge, bringing the total to $550, and the Division says there is no provision to waive it. The report gives the principal office, the FEI number, the directors and principal officers, and the agent.

A report not delivered by 5 p.m. Eastern on the third Friday in September exposes the certificate to revocation on the fourth Friday. Unpaid fees, no registered agent, or an agent change not filed within 30 days are other grounds. Reinstatement costs $600 plus the annual report fees for each year missed.

Amendments and leaving Florida

• A change of name, home jurisdiction or agent needs an amended certificate of authority within 90 days. Amending a record costs $35.
• To withdraw, file the foreign corporation withdrawal application, CR2E023, for $35. It cancels the agent's appointment and makes the Secretary of State the recipient of process for claims arising while the corporation held authority.
• Taxes are a separate subject. Registration with the Division is not a tax filing.

Section 607.1502 sets out the consequences.

• No access to court. Until the certificate issues, the corporation can't prosecute or maintain any proceeding before a Florida court, and a court can stay one it already filed.
• Fees and penalties owed. For each unauthorized year the corporation owes the fees and penalties it would have paid by applying on time. A court can add a civil penalty between $500 and $1,000 per year of unauthorized business, a fraction counting as a year.
• Contracts stand. Contracts, deeds, mortgages and corporate acts keep their validity, and the corporation can still defend itself in court.
• Personal liability. Shareholders, officers and directors are not liable solely because the corporation operated without a certificate.
• Process and injunction. By operating without a certificate the corporation designates the Secretary of State to accept service for claims from its Florida business. The Department of Legal Affairs may bring an action to enjoin its activity.
• No agent. A corporation that lacks a registered agent can be barred from suing and, if a court orders it, charged $5 a day up to $500.

The Florida side of a corporation formed elsewhere is what Mainstay Filing's foreign qualification service covers. It drafts CR2E007 and submits it to the Registration Section. The Florida registered agent comes bundled for twelve months, then renews at $149 annually. The state's fee is $70. You provide the company details, the officer and director names and the original certificate of existence, since ordering documents from your home jurisdiction is not something Mainstay Filing does.

The annual report, any taxes and the January 1 to May 1 window remain with you or your accountant. Whether your activities amount to transacting business is a legal judgment, and Mainstay Filing isn't a law firm. For the lines in today's checkout, open the Florida foreign qualification page. If the agent is all you need, see the Florida registered agent page.