If you own a business that was created in a state other than Georgia, you will need to qualify or register that business in Georgia if you want to do business there. Here is an overview of the rules on how to qualify your foreign (non-Georgia) limited liability company (LLC) to do business in Georgia.

What is a Foreign LLC?

For Georgia purposes, if your LLC is formed in another state, then it is known as a foreign LLC in Georgia. In other words, foreign doesn’t mean from another country. Instead, it means your business was organized under the laws of another state. A domestic LLC, on the other hand, is one that is formed in the state where it is doing business. This is common usage throughout the United States. For example, an LLC formed in Minnesota is a foreign LLC in Wisconsin.

Transacting Business in Georgia

According to Georgia’s LLC Act, you are required to register your foreign company with the state of Georgia if you are “transacting business” in Georgia. What does this mean? Well, like most states, Georgia’s LLC Act does not specifically define the phrase “transacting business” in relation to foreign registrations.

However, state laws governing when foreign companies must collect state sales tax in their state provide some guidance on the issue. Under these laws, a business must have a physical presence in—or nexus with—the state in order to be required to collect state sales tax on sales to that state’s residents. Generally speaking, physical presence and nexus are synonymous, and mean having:

• a warehouse in the state
• a store in the state
• an office in the state, or
• a sales representative in the state.

Certain exceptions may apply and the rules can get more complicated with things like Internet sales. Nevertheless, in general, if you have an office, a store, a warehouse, or employees in another state, you will need to qualify your LLC as a foreign company in that state. For more details, including some possible distinctions between physical presence and nexus, check Nolo’s articles on Internet Sales Tax: A 50-State Guide to State Laws.

Certain Activities Are Exempt

Like most states, Georgia’s LLC Act specifies certain activities that do not constitute transacting business in the state. The items listed include:

• defending or settling a lawsuit
• dealing with internal LLC affairs such as holding member or manager meetings
• having a bank account in the state
• having an office, agency, or persons in the state for handling your company’s membership or other ownership interests
• selling through independent contractors
• soliciting or procuring orders where the orders require acceptance outside the state before they become contracts and where those contracts do not involve any local performance other than delivery and installation
• making loans or creating or acquiring evidences of debt, mortgages, or liens on real or personal property or recording the same
• securing or collecting debts
• conducting an isolated transaction that is not in the course of similar, repeated transactions
• transacting business in interstate commerce
• serving as trustee, executor, administrator, or guardian, or in a similar capacity, when permitted to do so under Georgia law; and
• owning an interest in or controlling another entity that is organized in or transacting business in Georgia.

The LLC Act also specifically states that the latter list is not exclusive; other activities also may be exempt. For the full, legal description of each of the listed items, check Section 14-11-702(b) of the Code of Georgia. If your LLC’s only activity in Georgia is one or more of the listed items, you should not need to register with the state.

Certificate of Authority

To register your business in Georgia, you must file an Application for Certificate of Authority (Form 241) with theGeorgia Secretary of State (SOS). You can download a copy of the application form from the SOS website. (The full name printed on the form is Application for Certificate of Authority for Foreign Limited Liability Company.)

To complete the application, you must provide more or less the same information that you need to create an LLC in your home state. More specifically, for a Georgia application for registration, you need to provide:

• the name of your LLC as originally registered in its home state
• if necessary, the alternate name your LLC will use while transacting business in Georgia (may be necessary if your LLC’s original name or something very similar is already being used by another Georgia registered business, or the original name does not comply with Georgia’s LLC naming requirements)
• the date your LLC commenced or proposes to commence business in Georgia (if more than 30 days before filing, a penalty applies)
• the name, address, and other contact information of the person filing
• the state where your LLC was formed
• the date on which your LLC was formed
• the street address of your LLC’s principal place of business
• the name and street address of your LLC’s registered agent in Georgia
• the name and address of a manager of your LLC (a person with substantial responsibility for managing the LLC’s business activities)
• the address where your LLC’s records (such as your articles of organization) are kept
• an effective date for the application (which may be the filing date), and
• an authorized signature.

The filing fee is $225.

What Happens if You Don’t Register?

If your LLC transacts business in Georgia without authority, it cannot bring a lawsuit in any of the state’s courts. In addition, your LLC will be liable for all fees it should have paid if it had been properly registered and a penalty of $500. The state may also act to restrain your LLC from doing further business in Georgia. However, not being registered does not invalidate your LLC’s contracts or prevent it from defending a lawsuit in Georgia.

Registering a Foreign Corporation in Georgia

If your business is organized as a corporation rather than an LLC, the rules and requirements for foreign qualification in Georgia are similar. You will, however, have to use a different application form (Form 236). See the Georgia Secretary of State website for forms, information, and filing instructions for registering a foreign corporation in Georgia.

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