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GLOBAL INFO

United States of America

COUNTRY:

United States of America

QUESTION:

ANSWER:

1.      What are the main company forms in your country?

Limited Liability Companies (“LLC”), and Corporations (Sub S Pass-through Corporations for 100 of less Domestic U.S.  shareholders, and C Corporations for All Others)

2.      Which is the most preferred company form by foreign investors?

For smaller investments under US$10,000,000, LLC’s to secure favourable pass-through income tax treatment. For larger investments, C Corporations, which pay corporate income tax. Foreign investors may not participate in S Corporation (with pass-through income tax treatment) ownership.

3.      What are the basic capital requirements of this company? (minimum amounts, types of capital, deadline of capital contribution)

Corporate (and LLC) laws are enacted and administered by U.S. States, so capital requirements can vary. The leading corporate jurisdiction, Delaware, among other states, has no minimum capital requirements, no deadline for capital contributions, and accepts services and goods in lieu of cash for capital .  Most states allow single member LLC's and single shareholder corporations, and Texas, among other states requires identification of the number of ownership units or shares authorized, the par value of such units or shares, and whether multiple classes of units or shares are authorized Investors are cautioned, however, that little or no capital can jeopardize the ability of the entity to provide personal liability protection for its owner-investors.

4.      What are the basic rules of shareholders liability for company debts in this company?

Shareholders have no personal liability for LLC or Corporate debts, provided the entity is properly capitalized and administered.

5.    What are the basic management requirements for this company? (only natural persons, or nationals can be managers etc.)

Fictitious entities (viz., LLC’s and Corporations) or individuals can manage LLC’s, Corporations, and even partnerships, limited partnerships, and trusts, but see answer 3 above for management disclosure requirements in some states.. In most industries, except certain defense and intelligence fields, there are no nationality requirements on ownership or management, although foreign nationals must comply with immigration/visa requirements administered by the Federal Department of Homeland Security.

6.      How long does the registration procedure of this company take?

Between 2 or 3 hours, 24 hours, several days, or a week or more in Delaware and many U.S. States. States charge additional, but modest fees for faster registration services.

7.      What are the main costs of formation of this company in local currency?

State registration, filing, and taxes usually cost between US$300 and $1,000, depending upon, in some states, the capitalization declared for the LLC or Corporation and the speed of the registration requested.

8.      What is the average attorney’s fee of the formation of this company in local currency?

Depending upon the, number of shareholders, capitalization, and structure of the LLC or Corporation, and the state involved, full formation and organization of an LLC or Corporation range between US$2,000 and US$5,000. On-line and do-it-yourself services may cost less, but may not cover important legal issues, including foreign ownership, operating and shareholder agreements, and tax issues.

9.      What are the basic publicity requirements of this company (filing of company changes, financial reports, etc.)

There are no publication requirements for company formation in U.S. States for privately-held LLC’s and Corporations, the majority of ownership vehicles in the U.S. economy, although certificates of formation for LLC's and incorporation for corporations are public documents available for inspection. As well, some states require annual information reports available for public inspection; however, such reports are very brief and need not identify a reporting entity's ultimate ownership, a major factor in foreign private investment in U.S. real estate. Terminating or dissolving an entity, however, requires public notice in most U.S. States to provide creditor notice.

10.   What are the main auditor requirements?

Privately-owned entities in the U.S. have no audit requirements imposed by State corporate law, unless such entities are in banking and related financial services and some regulated industries like insurance. Publicly-owned entities have auditor requirements imposed by the Federal Securities and Exchange Commission in Washington, D.C.