Senate Bill 23-090, effective August 7, 2023, enacts the 2022 amendments to the UCC addressing transactions involving digital assets.
Senate Bill 23-1297, effective August 7, 2023, prohibits a corporation from issuing a scrip in bearer form upon the holder surrendering enough scrip to equal a full share.
Senate Bill 23-037 – In a news release dated April 12, 2023 Colorado’s Secretary of State applauded the signing of SB23-037, the “Deceptive Solicitations Act.” According to the news release “The act puts meaningful restrictions on deceptive solicitations sent by third parties to Colorado businesses related to documents filed with or provided by the Secretary of State’s office.” It establishes criteria for business solicitations from a third party related to documents filed with or provided by the Secretary of State’s office and imposes penalties for non-compliance. The bill includes an exemption for entities that have an existing relationship with the business owner and provide a variety of business services, including but not limited to acting as their registered agent. The full news release can be read here.
Senate Bill 22-034, effective February 1, 2023, amends the Corporations and Associations Act to add a section concerning measures to counteract the filing of fraudulent business documents with the Secretary of State. The bill prohibits including the name and address of certain persons in documents filed with the Secretary of State without the person’s consent and provides a procedure for the submission of a complaint, investigation and remediation.
Emergency Regulation 22-E-14 “Concerning Appointment of Insurance Company Registered Agents” was promulgated and adopted by the Commissioner of Insurance, effective retroactively to August 9, 2022. The emergency regulation outlines the procedure for implementing House Bill 1398, which requires foreign insurance companies to appoint a registered agent other than the Division of Insurance. Among other things, the emergency regulation provides that a Form 12 must be submitted through the NAIC’s UCAA amendment application and that insurance companies have until December 1, 2022 to make this filing.
Senate Bill 094 (Laws of 2021), effective September 1, 2021, created a licensing category and requirement for third party logistics providers. Third Party Logistics providers will be required to register with the Colorado Board of Pharmacy as such on an application developed by the Board.
House Bill 1250, effective August 10, 2022, amends the business entities law to change references to “owner’s interest” from “owners’ interest”, to repeal a provision exempting certain domestic entities from a provision allowing reinstatement, and to clarify notification requirements for ratification of defective corporate actions.
House Bill 1001 authorized the Department of State to establish a credit program to reduce certain business fees. Pursuant to H.B. 1001, effective July 1, 2022, the fee for filing the Articles of Organization of an LLC and for the Statement of Trade Name (filed by reporting entities, non-reporting entities, and individuals) is reduced to $1. H.B. 1001 states that the credit program to reduce fees will end on or before June 30, 2023, unless otherwise extended by the legislature.
House Bill 1398, effective August 10, 2022, amends Sec. 10-3-107 of the Colorado insurance law, governing the appointment of a registered agent to receive service of process, to state that an insurance company shall not engage in the business of insurance in Colorado unless it has filed with the Commissioner of Insurance the name of a registered agent in the state designated to receive service of process. Formerly, domestic insurers had to designate a registered agent but foreign insurers had to appoint the Commissioner of Insurance as their true and lawful attorney upon whom process shall be served. Pursuant to House Bill 1398, foreign insurers will now have to file with the Commissioner of Insurance the name of a registered agent, rather than appointing the Commissioner.
House Bill 1124, effective April 19, 2021, amends provisions of the business entity laws regarding activities that constitute doing business by a foreign entity, adds definitions of terms relating to electronic communications, specifies how notice may be given by electronic transmission, and establishes requirements for remote participation in shareholders’ and directors’ meetings.
Senate Bill 86 (Laws of 2019), effective July 1, 2020, amends the Colorado Business Corporation Act and the Colorado Corporations and Associations Act regarding, among things, definitions, conversions, mergers, names, dissolution, forum selection clauses, appraisal rights, proxies, corporate opportunities, and director liability.
Case summaries
Piercing an LLC’s Veil
Sedgwick Properties Development Corp. v. Hinds, 2019 COA 10, decided July 3, 2019. The Colorado Court of Appeals, in reversing the trial court’s piercing the veil of a single member LLC, stated the trial court should have taken into account the difference between a corporation and a single member LLC in determining whether to pierce the veil.
Other notices
October 26, 2021 — The Colorado Secretary of State is alerting business owners about potentially misleading notices requesting an extra fee from a third party to file business documents. The solicitation asks businesses to pay a fee of $65 to file their yearly periodic report with the Secretary of State’s office. The news release states that the Colorado Secretary of State’s office does not send these solicitations or mail out business filing forms.
October 23, 2020 — The Colorado Secretary of State’s office issued an alert to small business owners about potentially misleading notices. The alert states that the Secretary of State’s office has received numerous reports of third parties sending deceptive and misleading solicitations to Colorado businesses.
April 30, 2020 — The Secretary of State issued an alert to Colorado’s small business owners about potentially misleading notices from a third party asking for additional fees to file business reports. The alert contains a sample of the solicitation which the Secretary of State states did not come from her office.