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The procedures for forming and operating a Washington D.C. limited liability corporation (LLC) are outlined in the city’s LLC legislation.

In this guide, we provide straightforward explanations of Washington D.C. LLC legislation such as:

Requirements for forming an LLC
Duties of a Registered Agent and Appointment Operating Agreements
Requirements for Biennial Reports

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Requirements for forming an LLC

The prerequisites for founding an LLC are outlined in Washington D.C. LLC legislation. To make the procedure easier, the District of Columbia established the CorpOnline site and a PDF Articles of Organization form.
Statute for the Formation of a Limited Liability Company in the District of Columbia

The District of Columbia Uniform Limited Liability Act of 2010 contains the following LLC creation statutes:

Section 29-802.01 Limited liability corporation formation; certificate of organization

(a) One or more people may serve as organizers to incorporate a limited liability company by signing and sending a certificate of formation to the Mayor.

(a) A certificate of organization must include the following information:

(1) The name of the limited liability corporation, in accordance with Sections 29-103.01 and 29-103.02(f);

(2) The first major office’s street and postal addresses, as well as the name, street, and other information required by 29-104.04; and

(3) If the firm intends to have one or more series that are recognized as independent entities with debts, obligations, and other responsibilities limited to the assets of a specific series as stated in the operating agreement as permitted by 29-802.06, a declaration to that effect.

(c) Subject to 29-801.09(c), a certificate of organization may include statements other than those required by subsection (b) of this subsection [section], but may not change or otherwise affect the requirements of 29-801.07(c) in a way that is inconsistent with that section. A declaration in a certificate of incorporation, on the other hand, is ineffective as a statement of authority.

(d) A limited liability company is created when the Mayor files the certificate of incorporation for the business, it becomes effective, and at least one person becomes a member.

What This Means: Key Points*

The conditions for establishing (or creating) an LLC are outlined in the District of Columbia LLC Act. To satisfy these criteria, the District of Columbia provides both online and hard copy LLC filing.

Required information for the creation of a District of Columbia LLC:

The name of LLC (Must meet District of Columbia LLC naming requirements)
The street and postal location of the LLC’s headquarters office Whether the LLC is a series LLC
Name and location of the registered agent in the District of Columbia

Optional Information for the Formation of a District of Columbia LLC:

LLC organizers may include their own terms as long as they do not clash with the LLC legislation.

Duties of a Registered Agent and Appointment

The responsibilities and appointment of the LLC registered agent are defined under Washington D.C. LLC statutes.

Statute of the District of Columbia LLC Registered Agent

The District of Columbia Business Organizations Code contains the following registered agent statutes:

Section 29-104.04: Appointment of a registered agent.

(a) The entity and state must sign a registered agent filing:

(1) The name of the commercial registered agent for the represented company; or

(2) If the entity lacks a commercial registered agent:

(A) The noncommercial registered agent’s name and address; or

(B) If the entity designates an officer or employee to receive service of process, the title of the office or other position that person holds, as well as the location of that person’s business office.

(b) The designation of a registered agent under subsection (a)(1) or (2)(A) of this section shall constitute an assurance by the represented entity that the agent has agreed to serve under 29-102.09.

(c) The Mayor must make a daily list of filings including the name of a registered agent accessible in a record as soon as practical. The list should include:

(1) Be available for a minimum of 14 calendar days;

(2) List the names of the registered agents alphabetically; and

(3) Specify the kind of filing and the name of the represented entity submitting.

What This Means: Key Points*

The role of a registered agent is to accept service of process (legal summons to a lawsuit).

A registered agent in the District of Columbia must:

Maintain a registered office in Washington, D.C. (i.e., no P.O. boxes)
Be a person, a DC company or LLC, or a foreign corporation or LLC having the same business address as the registered office address.

Operating Contracts

The LLC statutes of Washington, D.C. establish instructions for forming and maintaining an LLC operating agreement.

The District of Columbia Uniform Limited Liability Act of 2010 contains the following operating agreement statutes:

Operating agreement; scope, purpose, and limits (Section 29-801.07).

(a) Except as otherwise stated in subsections (b) and (c), the operating agreement governs:

(1) Relationships among members and between members and the limited liability corporation;

(2) The rights and responsibilities of a management under this chapter;

(3) The company’s operations and affairs, as well as the conduct of such activities and affairs; and

(4) The procedure and terms for modifying the operating agreement.

(b) If the operating agreement does not otherwise provide for a thing listed in paragraph (a), this chapter governs the subject.

(b) An operating agreement should not include any of the following provisions:

(1) Change the competence of a limited liability corporation under 29-801.05 to sue and be sued in its own name;

(2) Modify the legislation that applies under 29-801.06;

(3) Modify the provisions of Section 29-802.04;

(4) Subject to subsections (d) through (g), abolish the obligation of loyalty, the duty of care, or any other fiduciary responsibility;

(5) Eliminate the contractual responsibility of good faith and fair dealing under 29-804.09(d), but the operating agreement may establish the methods for measuring fulfillment of the obligation, if not obviously unreasonable.

(6) Restrict the obligations and rights described in 29-804.10 in an unreasonable manner;

(7) Modify the dissolution reasons indicated in 29-807.01(a)(4) and (5);

(8) Modify the need in 29-807.02 to wind up the operations and affairs of a limited liability corporation.

(9) Unreasonably limit a member’s ability to bring an action under Subchapter 8 of this chapter;

(10) Limit the right of a member who will have personal responsibility with regard to a surviving, converted, or domesticated organization to authorize a merger or domestication under 29-809.10 or Chapter 2 of this chapter.

(11) Except as otherwise specified in 29-801.08 or 29-801.09(b), limit the powers of a person other than a member or management under this chapter.

(12) Modify any requirement, practice, or other provision of this section that relates to:

(A) Registered representatives; or

(B) The Mayor, including provisions relating to documents allowed or required to be given to the Mayor for filing according to this chapter;

(13) absolve or exonerate a person of duty for bad faith, deliberate or intentional wrongdoing, or knowing violation of the law; or

(14) Modify the requirements of 29-808.05, except that the operating agreement may provide that the corporation is not required to maintain a special litigation committee.

(15) [(15)]

Change a person’s ability to disassociate under 29-807.01, except to require that notification of dissociation be recorded.

(d) The following regulations apply, subject to paragraph (c) of this section and without restricting additional provisions that may be included in an operating agreement:

(1) The operating agreement may establish the procedure for authorizing or ratifying a particular conduct or transaction that would otherwise breach the duty of loyalty by one or more disinterested and independent individuals following full disclosure of all pertinent information.

(2) To the extent that the operating agreement of a member-managed limited liability company expressly relieves a member of a responsibility that the member would otherwise have under this chapter and imposes the responsibility on one or more other members, the operating agreement may also eliminate or limit any fiduciary duty that would have pertained to the responsibility, to the benefit of the member that the operating agreement relieves of the responsibility.

(3) If the operating agreement is not plainly irrational, it may:

(A) Limit or remove the characteristics of the obligation of loyalty specified in 29-804.09;

(B) Identify particular acts and affairs that do not breach the duty of allegiance.

(C) Modify the duty of care, but may not enable wilful or intentional misbehavior or willful or intentional violation of the law; and

(D) Modify or remove any other fiduciary obligation.

(e) Abrogated.

Repealed (f).

Repealed (g).

(h) Any allegation under subsection (c)(5) or (d)(3) of this section that a provision of an operating agreement is plainly unreasonable must be decided as a matter of law by the Superior Court. The courtroom:

(1) Shall determine its decision as of the moment the challenged phrase became part of the operating agreement, taking into account solely the facts that existed at the time; and

(2) May invalidate the term only if, in light of the limited liability company’s aims, operations, and affairs, it is abundantly obvious that:

(A) The term’s goal is illogical; or

(B) The phrase is an irrational way of achieving the provision’s goal.

What This Means: Key Points*

An LLC operating agreement enables LLC members to establish ground rules for how their particular LLC will run. These regulations are often referred to as “terms” or “provisions.”

Operating agreements are governed by state law. If the legislation states that LLC members cannot dissolve an LLC unless all members agree, LLC members cannot amend or override the statute by an operating agreement.

It is simpler to negotiate difficulties regarding the running of the LLC when an operating agreement is in place. In the event of a litigation or disagreement, LLC members (or the courts) will have something to refer to.

If an LLC member cannot settle a disagreement and there is no operating agreement, the courts will apply LLC legislation to determine the matter.

Making an Operating Contract

Some LLCs, such as professional or real estate LLCs, may need special terms, but others may merely require basic provisions:

Responsibilities of each member
How will new members be admitted?
How may current members transfer or cancel their membership?
How will earnings and dividends be distributed?
The procedure for making changes to the operating agreement

Requirements for Biennial Reports

The criteria for biannual LLC reporting are outlined in Washington D.C. LLC legislation. To make the procedure easier, the District of Columbia built the CorpOnline platform and a PDF biannual report form.
Statute of the District of Columbia LLC Biennial Report

The District of Columbia Business Organizations Code contains the following biennial report statutes:

Section 29-102.11. Mayor’s biennial report.

(a) Each domestic filing entity, limited liability partnership, and registered foreign entity must submit to the Mayor for filing a biannual report that includes the following information:

(1) The entity’s name and the jurisdiction in which it was formed;

(2) The entity’s registered agent’s name, street address, and postal address in the District;

(3) The major office’s street and postal addresses;

(4) At least one governor’s name; and

(5) In the case of a registered foreign entity, a declaration that the entity is in good standing in its state of formation, or a description of the entity’s efforts to bring itself into good standing, if the entity is not in good standing.

(6) For biannual reports submitted on or after January 1, 2020, the report must include the names, residential addresses, and business addresses of all individuals who have a direct or indirect, legal or beneficial ownership of a governance or total distributional stake in the entity:

(A) More than 10%; or

(B) Does not exceed 10%; provided that the individual:

I Has authority over the entity’s financial or operational decisions; or

(ii) Has the capacity to control the entity’s day-to-day activities.

(7) The biannual report must include the names, home, and business addresses of each individual whose aggregate share of direct or indirect, legal or beneficial ownership of a governance or total distributional stake in the foreign corporation is stated in paragraph (6) of this subsection:

(A) More than 10%; or

(B) Does not exceed 10%; provided that the individual:

I Has authority over the foreign entity’s financial or operational choices; or

(ii) Has the capacity to control the foreign entity’s day-to-day activities.

(8) Failure to submit a biennial report that includes the information required by paragraphs (6) and (7) of this subsection will result in administrative dissolution of a domestic entity under the process outlined in 29-106.02 or termination of registration of a foreign entity under the process outlined in 29-105.11.

(b) The information in the biennial report must be current as of the day the report is signed on the entity’s behalf. If information in the biennial report changes after the report is submitted, a statement of correction in accordance with 29-102.05 must be provided to reflect the changes.

(c) The first biennial report shall be delivered to the Mayor for filing by April 1 of the year following the calendar year in which the domestic filing entity’s public organic record became effective, the domestic limited liability partnership’s statement of qualification became effective, or the foreign filing entity registered to do business in the District. Subsequent biannual reports must be presented to the Mayor by April 1st of each succeeding calendar year.

(d) If a biannual report fails to include the information required by this title, the Mayor must immediately notify the reporting domestic or registered foreign company in writing and return the report for rectification.

(e) If the name or address of a registered agent in a submitted biannual report changes from the information reflected in the Mayor’s records immediately before the filing, the varying information in the biennial report must be deemed a declaration of change under 29-104.07, 29-104.08, or 29-104.09.

What This Means: Key Points*

You may submit your District of Columbia biannual report online or by paper.

Your District of Columbia LLC biannual report must include (and be current as of the date of filing) the following information:

The company’s name
Principal office street address and postal address
Name and address of the registered agent
The name of a single governor
The names of any members who hold more than 10% of the company.
The name and address of any members with 10% or less ownership interest but control of the entity’s financial or operational choices; or the capacity to manage the entity’s day-to-day operations.

Due dates for biennial reports:

Biennial reports must be submitted by April 1 of the second calendar year after the first biennial report. The first biannual report is due the calendar year after the LLC’s formation.

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