Find out how to qualify your LLC to conduct business in Arizona.
If you own a company that was founded in a state other than Arizona, you must qualify or register it in Arizona in order to conduct business there. The requirements for qualifying your international (non-Arizona) limited liability corporation (LLC) to conduct business in Arizona are summarized here.
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What exactly is a Foreign LLC?
If your LLC is founded in another state, it is referred to as a foreign LLC in Arizona. In other words, being foreign does not imply being from another nation. Instead, it signifies that your company was formed under the laws of another state. A domestic LLC, on the other hand, is one that is created in the state in which it operates. This is a prevalent phrase in the United States. In Rhode Island, for example, an LLC founded in Massachusetts is a foreign LLC.
Doing Business in Arizona
If you are “transacting business” in Arizona, you must register your foreign company with the state, according to Arizona’s LLC Act. What exactly does this mean? The word “transacting business” in connection to overseas registrations is not defined precisely under Arizona’s LLC Act, as it is in other states.
State regulations determining when foreign enterprises must collect state sales tax in their state, on the other hand, give some advice on the subject. To be obligated to collect state sales tax on sales to citizens of a state, a firm must have a physical presence in, or nexus with, that state. In general, physical presence and nexus are synonymous and refer to:
a storage facility in the state
A shop in the state, an office in the state, or a sales representative in the state are all examples of state-based businesses.
Certain exclusions may apply, and the regulations might become more convoluted in situations such as Internet sales. However, if you have an office, a shop, a warehouse, or workers in another state, you must register your LLC as a foreign corporation in that state.
Some Activities Are Exempt
Arizona’s LLC Act, like other states’, outlines specific actions that do not constitute doing business in the state. Among the objects mentioned are:
defending or settling a lawsuit dealing with internal business affairs such as holding member meetings having a bank account in the state selling through independent contractors soliciting or receiving orders accepted outside the state and filled by goods shipped into the state creating or acquiring indebtedness, mortgages, or other security interests
The LLC also expressly specifies that additional activities not explicitly enumerated are not necessarily prohibited; in other words, other activities may potentially be exempt. Check Section 29-809 of the Arizona Revised Statutes for a complete legal explanation of each of the listed things.
If your LLC’s only operation in Arizona is one or more of the activities mentioned above, you should not be required to register with the state.
Registration Application
You must submit an Application for Registration of Foreign Limited Liability Company with the Arizona Corporation Commission to register your firm in Arizona (ACC). The application form may be downloaded on the ACC website.
To complete the application, you must give the same information that you would provide to register an LLC in your home state. More precisely, for an Arizona registration application, you must provide:
whether or not your LLC is a professional LLC
your LLC’s precise (“true”) name as registered in the state where it was founded (the true name will be called the “foreign name” on the Arizona Corporation Commission system)
an indication of whether you intend to use your LLC’s true name or a separate, fictitious name in Arizona (a fictitious name is required if your LLC’s true name or something very similar is already in use by an Arizona registered business or the true name does not contain a term such as “Limited Liability Company” or an abbreviation such as “LLC”
If your LLC is a professional LLC, offer a summary of the professional services it will provide, as well as the state in which your LLC was founded and the date your LLC was created.
a description of the objective or general nature of the business that your LLC will conduct in Arizona
the name and street address of your Arizona LLC’s statutory agent Optionally, a separate postal address for your Arizona LLC’s statutory agent
a signed statutory agent acceptance form (Form M002)
the street address of your LLC’s major office (either the street address of the office your LLC is obliged to keep in its home state or, if not, the street address of your LLC’s statutory agent in its home state)
the street location of your LLC’s Arizona recognized place of business (KPB), which may also be the address of your LLC’s Arizona statutory agent
an indicator of whether your LLC is member-managed or manager-managed a completed Manager Structure Statement if your LLC is manager-managed (Form L040)
Include a completed Member Structure Statement (Form L041) and an authorized signature, including a statement indicating whether the signer is (a) a manager, (b) signing for a manager, (c) a member, (d) signing for a member, or (e) is otherwise a duly authorized agent of the LLC if your LLC is member-managed.
The necessary statutory agent acceptance form, as well as manager and member structure statement forms, may be downloaded on the ACC website.
With your application, you must also attach a proof of existence or a certificate of good standing. The certificate is typically granted by the secretary of state (or an analogous authority) in the state in which your LLC is formed. The certificate cannot be older than 60 days. The price for filing is $150.
What Happens If You Do Not Sign Up?
If your LLC does business in Arizona without permission, it cannot sue in any of the state’s courts. Furthermore, the Arizona attorney general may file a lawsuit to prevent your LLC from doing business in the state. However, not being registered does not render your LLC’s obligations null and void or bar it from defending a lawsuit in Arizona. Furthermore, a member of the LLC is not personally accountable for any of the LLC’s debts, obligations, or liabilities just because the organization performed business in Arizona without permission.
Forming a Foreign Corporation
The regulations and standards for international qualifying in Arizona are identical whether your company is structured as a corporation rather than an LLC. However, you will need to utilize a separate application form. For paperwork, information, and filing requirements for registering a foreign company in Arizona, visit the Arizona Corporation Commission website.