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Nevada corporation
From Wikipedia, the free encyclopedia
 |
| Business law |
|---|
| Business organizations |
| Basic forms: |
| Sole proprietorship |
| Corporation |
| Partnership (General · Limited · LLP) |
| Cooperative |
| USA: |
| Business trust · LLC · LLLP Series LLC Delaware corporation Nevada corporation |
| Commonwealth/Ireland/UK: |
| Limited company (By shares · By guarantee) (Public · Proprietary) |
| Civil law countries: |
| AB · AG · ANS · A/S · A/S |
| K.K. · N.V. · OY · S.A. · GmbH |
| European Company Statute |
| Doctrines |
| Corporate governance |
| Limited liability · Ultra vires |
| Business judgment rule |
| De facto corporation and corporation by estoppel |
| Piercing the corporate veil |
| Related areas of law |
| Contract · Civil procedure |
A Nevada Corporation is a corporation chartered under the laws of the U.S. state of Nevada.
Nevada, like the state of Delaware (See Delaware corporation), is well known as a corporate haven. Many major corporations are chartered in Nevada, particularly corporations whose headquarters are located in California and other Western US states.
While public companies can benefit from Nevada's flexible statute, Nevada is particularly attractive to privately held corporations, and its statute's default provisions are particularly favorable to management. As in the case of Delaware, critics of the Nevada corporate law believe that its provisions, and the Nevada courts, are excessively friendly to corporations and their managers at the expense of shareholders' rights.
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Nevada's laws offer flexibility to a board of directors in managing the affairs of a corporation, and permit management to put in place strong protection from hostile takeovers.
Nevada (unlike other states) permits the corporation's articles of incorporation to vest authority to adopt, amend or repeal bylaws exclusively in the directors, so that shareholders would not be able to change the corporation's bylaws.
Disputes over the internal affairs of Nevada corporations are usually filed in the Nevada District Courts, from which judgments can be appealed to the state Supreme Court. Because of the large number of corporations chartered in Nevada, the courts in that state are more focused on the application of corporate law than the courts of most other states. Nevada's courts are developing a strong body of case law that serves to give corporations and their counsel guidance on matters of corporate governance, although Delaware and some other states have a larger body of such case law.
On February 28, 2007, the Wyoming legislature passed legislation barring the use of "bearer shares". Previous to this, Nevada and Wyoming were the only two states allowing bearer shares. Now, only Nevada allows them. While Nevada has no statute specifically allowing bearer shares as Wyoming had, there are no statutes specifically prohibiting them in Nevada.
The Nevada Resident Agent Association (NRAA) is an organization of resident agents in Nevada. In the current 2007 legislature, the association is spearheading the adoption of a variation of the Model Registered Agents Act (MRAA) and the formation of a Nevada Board of Registered Agents to oversee and regulate the industry. Government and industry nationwide have been monitoring the progress of this group in Nevada and the regulatory board they are forming as a possible model for nationwide implementation. There has been concern in the government that unregulated incorporation businesses could possibly aid in financial crimes and terrorism funding.
The newly elected Secretary of State, Ross Miller (D) (son of former Nevada governor Bob Miller) has indicated that he wishes to eliminate "bearer shares" and "nominee officers" which are two of the primary attributes that Nevada corporations currently enjoy and the reason thousands of companies choose to incorporate there. It is unknown what effect this will have on the number of corporations filed in Nevada. The outgoing Secretary of State, Dean Heller (R) was just elected to U.S. Congress.
Nevada's tax structure is also a large benefit to incorporation in Nevada. Nevada has no franchise tax. It also has no corporate income tax or personal income tax [1]. Nevada and Texas are the only two states who do not have information sharing agreements with the Internal Revenue Service.