BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 657|
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CONSENT
Bill No: AB 657
Author: Gordon (D), et al.
Amended: 3/21/11 in Assembly
Vote: 21
SENATE BANKING & FINANCIAL INSTITUT. COMM : 6-0, 06/29/11
AYES: Vargas, Blakeslee, Kehoe, Liu, Padilla, Walters
NO VOTE RECORDED: Evans
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 70-0, 05/12/11 (Consent) - See last page
for vote
SUBJECT : Corporations: statement of information:
Secretary of State
SOURCE : Secretary of State Debra Bowen
DIGEST : This bill allows businesses to elect to receive
electronic notices, in lieu of hard copy notices, from the
Secretary of State; standardize the filing requirements
imposed on different types of business entities by the
Secretary of State; and make other technical changes
intended to improve the Secretary of State's ability to
administer the laws under her jurisdiction.
ANALYSIS : Existing law requires corporations to register
with the Secretary of State and file annual statements of
information with specified information. Existing law
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requires the Secretary of State to annually mail a notice
of compliance three months prior to the close of the
applicable filing period.
This bill:
1.Authorizes, but not require, business entities to elect
to receive notices from the Secretary of State via
electronic mail.
2.Requires foreign corporations to submit an initial
Statement of Information within 90 days after filing
their original statements of designation.
3.Permits a suspended common interest development
corporation to file its Statement by Common Interest
Development while it is suspended.
4.Authorizes the Secretary of State to destroy superseded
Statements of Common Interest Development.
5.Standardizes the Statement of Information requirements
imposed on credit union corporations with those imposed
on all other types of corporations, and would permit
these corporations to designate a registered corporation
as an agent for service of process.
6.Sets the filing fees for the initial 90-day Statement of
Information for California and foreign LLCs, credit union
corporations, and consumer cooperative corporations at
$20.
7.Makes other conforming technical changes and correct
incorrect code references.
Comments
According to information provided by the sponsor, this bill
contains seven changes, as follows.
1.Under existing law, the Secretary of State is required to
mail paper notices to all corporations and LLCs,
reminding those entities to file required annual or
biennial Statements of Information. Notices to
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cooperative corporations, credit union corporations, and
LLCs must also include a paper copy of the Statement of
Information form, which is already available for download
on the Secretary of State's web site. As a result, the
Secretary of State mails over 1.2 million reminder,
delinquency, penalty, and suspension notice to
businesses, at a cost of over $500,000 in printing and
postage each fiscal year.
2.The first of this bill's provisions authorizes businesses
to provide a valid electronic address to the Secretary of
State, for the purpose of receiving future notices, thus
reducing the costs related to paper postal mailings.
These changes are contained in Corporations Code Sections
1502, 2203, 2205, 6210, 6810, 8210, 8810, 12570, 12670,
17060, 17651, 17653, and 17654.
3.Existing law requires California corporations and foreign
LLCs to file their initial Statements of Information
within 90 days of formation or registration. Foreign
corporations are not required to file an initial
Statement of Information until one year after the
corporation has qualified to do business in California.
To ensure consistency among business entities and ease
the automation of Statement of Information filing, this
bill imposes the same 90-day filing requirement on
foreign corporations as is imposed on all other
corporations and LLCs. This change is contained in
Corporations Code Section 2117.
4.Existing law permits a suspended common interest
development corporation to file its Statement of
Information while suspended, but does not allow it to
file the Statement by Common Interest Development, which
is the most current information about the business. This
bill amends Corporations Code Section 1363.6 to allow the
Statement of Common Interest Development to be filed
while a common interest development corporation is
suspended. However, this bill would not grant the
suspended corporation any other powers it currently
lacks.
5.Existing law allows the Secretary of State to destroy
Statements of Information once they have been superseded,
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but does not grant the Secretary of State similar
authority to destroy superseded Statements of Common
Interest Development. This bill provides such
authorization through another amendment to Civil Code
Section 1363.6.
6.This bill also standardizes the Statement of Information
requirements imposed on credit union corporations with
those imposed on all other types of corporations and
would permit these corporations to designate a registered
corporation as an agent for service of process (Financial
Code Section 14101.6).
7.Existing law specifies the fees to file certain documents
at various levels, and states that filings whose fees are
unspecified are charged at a rate of $30 per filing.
This bill specifies the filing fees for the initial
90-day Statement of Information for California and
foreign LLCs, credit union corporations, and consumer
cooperative corporations at $20, which has the effect of
reducing the cost to file these forms by $10 (Government
Code Section 12186 and 12190).
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 8/15/11)
Secretary of State Debra Bowen (source)
California Credit Union League
ASSEMBLY FLOOR : 70-0, 05/12/11 (Consent)
AYES: Achadjian, Allen, Ammiano, Atkins, Beall, Bill
Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Chesbro, Cook, Davis, Dickinson, Donnelly, Eng,
Feuer, Fletcher, Fong, Fuentes, Furutani, Beth Gaines,
Galgiani, Gatto, Gordon, Grove, Hagman, Halderman, Hall,
Harkey, Hayashi, Hill, Huber, Hueso, Huffman, Jeffries,
Jones, Knight, Lara, Logue, Ma, Mansoor, Mendoza, Miller,
Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Pan,
Perea, V. Manuel Pérez, Silva, Skinner, Smyth, Solorio,
Swanson, Valadao, Wagner, Wieckowski, Williams, Yamada,
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John A. Pérez
NO VOTE RECORDED: Alejo, Cedillo, Conway, Garrick, Gorell,
Roger Hernández, Bonnie Lowenthal, Mitchell, Portantino,
Torres
JJA:nl 8/16/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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