Necessity of Filing Certificates, Etc., in West Virginia, Indiana, Tennessee, Mississippi, Kentucky, Ohio, Michigan, New York.

One of our members recently had an attorney examine the corporation laws of several States and give an opinion concerning the advisability of filing corporate certificates, securing so-called licenses, etc., in the various States wherever the member was making sales. The States referred to are West Virginia, Indiana, Tennessee, Mississippi, Kentucky, Ohio, Michigan and New York. This information may be helpful to other members, and a copy of the opinion follows:

West Virginia.—Every corporation whose principal place of business is located out of the State must pay an annual license tax as follows: If the authorized capital is not more than $25,000, $20; not more than $100,000, $50; not more than $1,000,000, $50; an additional forty cents on each $1,000 in excess of $100,000. No other taxes are assessed unless it has personal or real estate in West Virginia. Such foreign corporations may be authorized to hold property and do business in the State by certificate of the Secretary of the State that they have filed with him a copy of their articles of association, which certificate with a copy of the charter must be filed with and the certificate recorded by, the Clerk of the County Court of such county in which their business is conducted. A foreign corporation obtaining the above mentioned certificate authorizing to hold property and do business in West Virginia has the powers, rights and privileges and is subject to the same regulations, restrictions and liabilities that are conferred by statutes of West Virginia on domestic corporations.

Every foreign corporation which shall do business in the State without having obtained such certificate and having it filed and recorded according to law shall be guilty of misdemeanor, and upon conviction shall be fined not less than $50, nor more than $1,000 for each month its failure so to comply shall continue.

Indiana.—Every foreign corporation, except railroad and telegraph companies, built before March 15, 1901, and insurance companies must maintain a public business office in Indiana and must designate a representative in Indiana on whom service of process may be had. Such foreign corporations are subject to the liabilities, restrictions and duties imposed upon domestic corporations. They must before being permitted to do business in Indiana file in the office of the Secretary of State certified copy of its articles of incorporation, and a statement sworn to by the principal or agent in Indiana of the proportion of the capital stock of such corporation represented by its property located and business transacted in Indiana, and must pay in the office of the Secretary of State upon such proportion incorporation fees equal to those required of domestic corporations. The Secretary of State shall then issue a certificate authorizing such corporation to do business. Until this law is complied with, demands of a foreign corporation, whether arising out of contract or tort, cannot be enforced in the courts of Indiana, and such corporation is subject to a fine of not less than $1,000. Fee for filing articles of incorporation of a corporation with capital stock of $10,000 or under is $10, over $10,000, one-tenth of one per cent. upon authorized capital. No annual State tax on corporation as such.

Tennessee.—Foreign corporations must file in the office of the Secretary of State a copy of its charter and cause an abstract of same to be recorded in the office of the Register of each county in which such corporation purposes to carry on its business or to acquire and own property. Penalty for failure to do so shall subject the offender to a fine of not less than $100 nor more than $500. They must pay in the office of the Secretary of State a tax or license of $100 to exercise such privilege.

Mississippi.—Foreign corporations may sue and be sued and are liable to be proceeded against by attachment or otherwise, as individual non-residents are liable. The acts of their agents shall have the same force as the acts of agents of private persons within the scope of their power. They cannot recover on any contract made in the State or cause action originating therein which is in violation of laws or policies of States. No general statutes about taxation of foreign corporations. Subject governed in main by common rule as to taxes, but they are required to file with the Secretary of State certified copy of their charter for record, for which a graduated fee is fixed.

Kentucky.—If the corporation be organized under the laws of another State a board shall fix the value of the capital stock determined from the amount of the gross receipts of the corporation in Kentucky and elsewhere the proportion which the gross receipts in Kentucky bear to the entire gross receipts. The same proportion of the value of the entire capital stock, less the assessed value of tangible property in the State, shall be the correct value of the corporation franchise for taxation. Reports must be made and failure is a misdemeanor punishable by a fine of $1,000 and $50 for each day.

Ohio.—Foreign corporations are forbidden to do business until they have procured from the Secretary of State certificate that they have complied with the requirements of law which authorize them to do business in the State, and until said companies shall have caused the proportion of their capital stock employed within the State to be determined by the Secretary of the State, and shall have paid to him a fee of one-tenth of one per cent. upon such amount and obtained his certificate of such payment. No foreign corporation doing business in the State can maintain any action upon any contract made by it in the State until it has procured such certificate. The corporation must file with the Secretary of State due copy of its charter and statement under seal of the amount of its stock, the nature of its business and state which is to be its principal place of business, designating a person upon whom process against such corporation may be served. The person so designated must have an office where the corporation is to have its principal place of business within the State. Corporations complying with these requirements are exempt from attachment on the ground that they are foreign corporations.

Michigan.—Foreign corporations filing in the office of the Secretary of State certified copy of articles of incorporation and an appointment of an agent in this State for service of processes may carry on their business in Michigan. Foreign corporations may bring suits on furnishing security for costs.

New York.—No foreign corporation shall do business without first procuring from the Secretary of State certificate that it has complied with requirements of law. License fee shall be paid. No foreign corporation can do business in New York or sue on contract made there unless it has procured such certificate prior to the making of the contract. Selling goods through a factor within the State is not covered by this prohibitive clause. Before granting such certificate foreign corporation must file with Secretary of State copy of its charter and a statement setting forth its business, its principal place of business within the State and designating the person upon whom processes may be served. Such person must have an office within the State, where the principal place of business of such corporation is located. Foreign corporations must pay to State Treasurer a license fee of one-eighth of one per cent. for privilege of exercising its corporate franchise in New York, to be computed upon the amount of capital stock employed within the State during its first year of business.

Opinion No. 106.