Georgia Foreign Qualification
Georgia is home to approximately 1.1 million small businesses including domestic and foreign entities. Some of these businesses went through foreign qualifications in Georgia as they were looking to expand their physical presence in the state. So, whether you are looking at expansion, or looking for a pro-business environment or even a favorable legal and tax environment, you can always consider doing business in Georgia. A foreign LLC or a foreign corporation doing business in Georgia can benefit from opportunities including grants, VC funding, accelerators, business incentives, Foreign Trade Zones (FTZ), and training programs for entrepreneurs among others.
What is a Georgia foreign qualification?
Foreign qualification in Georgia is a process through which any company can register or operate their businesses in any state aside from the home state. The home state refers to the jurisdiction where the business was initially formed or incorporated. This process will allow you to legally operate your business within the state and pursue business and financial opportunities offered by the state. The biggest advantage of the Georgia foreign LLC registration instructions and process is that you will not be required to register or incorporate an entirely new business.
The process of Georgia foreign corporation registration or LLC formation may be different from the foreign qualification processes in other states. The regulations are governed by Title 14, Chapter 2, and Article 15 of the 2020 Georgia Code for business corporations and Title 14, Chapter 11, Article 7 for foreign limited liability companies. Let’s look at an example to understand this:
Example: If you have formed a domestic LLC in Alabama by filing the Certificate of Formation then Alabama will be considered your home state. Now, if you are thinking of expanding to Georgia then you will need to file for Georgia LLC foreign registration instead of a new business or domestic business registration. This process will help you obtain a certificate, which authorizes the Alabama LLC to conduct business in Georgia.
Once the Georgia foreign corporation filing requirements are fulfilled, you will be required to apply for and obtain business licenses or permits in the state. You will also be required to hire and maintain a Georgia registered agent like IncParadise to ensure all annual compliances as required by the state are fulfilled.
Doing business in Georgia
When an LLC or a business corporation operates in any state other than the home state or the state where it was initially registered then it may be required to “qualify” or apply for Georgia foreign corporation registration to conduct business in that state. The qualification is required as Georgia laws state that any LLC or corporation that was formed in another state will be considered a foreign entity.
According to Georgia Code, a foreign LLC or foreign corporation doing business in Georgia refers to having a physical presence in the state. Several activities constitute doing business in Georgia while there are some activities according to GA Code § 14-2-1501 (2020), that are not considered as transacting business in the state. Hence, it is important to check state laws to identify your activities in the state and whether you need to apply for a foreign qualification in Georgia.
The activities that are NOT considered as foreign LLC or foreign corporation doing business in Georgia are:
- If a company is securing or collecting debts
- If a company is transacting business in interstate commerce
- If an LLC is selling through independent contractors
- If a corporation has a bank account in Georgia
- If an entity has an office, or people in Georgia for handling ownership or membership interests
- If a company is settling or defending a lawsuit
- If a company is dealing with internal business affairs like holding meetings in the state
- If an entity owns an interest in or is controlling another business entity, which is conducting business in Georgia