Delaware Corporation Law
Have you ever wonder why majority of the fortune 500 companies has chosen to incorporate their business in Delaware?
Well it’s not because of taxes, although Delaware like every other state tries to keep its corporate tax rates low and competitive.
There are a few advantages why companies decided to incorporate in Delaware, for instance;
• As a state that welcomes corporations with open arms, Delaware provides such financial incentives for corporations as freedom from personal property tax, intangible property tax and even sales tax. A bigger incentive is the absence of a corporate income tax, provided the corporation is not doing business within the state. Furthermore, Delaware corporations pay an annual franchise tax that is among the lowest in the nation.
• Many states require a minimum capital investment of at least $1,000. In Delaware however, no minimum capital is needed to incorporate, resulting in an inexpensive incorporation. In addition, the Delaware Corporate Dept provides a streamlined process to incorporate. The corporate officers never needs to step foot in the state and annual meetings can be held anywhere in the world. Unlike some states that require at least three people to fill official corporate roles, in Delaware, one person can be the officer, director and shareholding at the same time.
But the major reasons for Delaware’s dominance in the incorporation of businesses, is due to the quality of Delaware’s courts and judges. Delaware has a special court, known as the court of Chancery, to rule on corporate law disputes without juries. Corporate cases do not get stuck on dockets behind the multitude of non-corporate cases. Instead, Delaware corporations can expect their legal disputes to be addressed promptly and expertly by judges who specialize in corporate law.
Part of the bi-partisan political consensus in Delaware is to appoint and confirm the best qualified corporate...