Amendments to Nonprofit Corporation Act – Senate Bill 2444 (effective January 1, 2012). The amendments add a definition of a “nonprofit corporation” consistent with common law and with definitions of nonprofit corporations in other states. Consequently, the definition of “distribution” clarifies payments to officers, directors and members for reasonable compensation for services provided are permitted. The amendments permit an automatic liability shield from personal liability (with exceptions for criminal law violations, receipt of un-entitled financial benefit, etc.) for directors of charitable nonprofit corporations (referred to below as “charitable nonprofits”). Likewise, an optional liability shield for nonprofit corporations which are not charitable nonprofits can be included in their articles of incorporation. Last, the amendments implement electronic technology concepts in communications among nonprofit corporations, their members and in membership meetings.
Extension of Expiration of Corporate Charters – Senate Bill 2408 (effective April 14, 2011). Before the Model Business Corporation Act and Model Nonprofit Corporation Act were adopted in Mississippi in 1988, state law in effect from 1892 to 1911 limited the duration of corporations formed in Mississippi to fifty (50) years. In 1950, the charter extension statute extended the duration of corporations formed under prior law from fifty (50) years to ninety-nine (99) years. The Secretary of State’s Office took no action to dissolve the extended charter corporations which still appear in the Agency’s database as active corporations. The amendment automaticallychanged the duration of the extended charter corporations to perpetual, with no filing required, so long as they continue to stay in business for thirty (30) days after March 14, 2011, the date the amendment took effect.
Uniform Real Property Electronic Recording Ac t– House Bill 599 (effective July 1, 2011). In 2009, the Legislature established a task force to study the merits of a uniform statewide system for the recording of real property documents. The task force included chancery clerks, tax assessors, tax collectors, legislators, computer experts, and individuals in the private sector who regularly handle real property records. The task force proposed adoption of the Uniform Real Property Electronic Recording Act (“URPERA”). Under URPERA, electronic documents with electronic signatures satisfy the legal requirements of filing original, signed, real property instruments. URPERA establishes uniform standards for the electronic filing and retrieval of real property instruments. Furthermore, URPERA authorizes electronic filing and retrieval of such documents, but does not mandate electronic filing.
Real Property Instruments - First Page Information and Font Size – House Bill 600 (effective July 1, 2012). The Real Property Task Force proposed increasing the font size of indexing instructions, as well as including additional contact information on the first page of real property instruments. HB 600 increases font size from eight (8) points to ten (10) points in size for any document presented to a chancery clerk for filing. HB 600 also requires certain contact information of all parties named in a real property instrument to be included on the first page of the instrument, including the current mailing address, business telephone number, and the current residential telephone number.
Charities and Nonprofits – House Bill 680 (effective July 1, 2009) makes several significant changes to the Mississippi’s charitable solicitation laws. The new provisions ease regulatory burdens on charities but also strengthen our ability to enforce the law against dishonest charities. These changes include increasing the annual revenue threshold for charity registration with our office from $4,000 a year to $25,000 a year. This law also expands our office’s enforcement authority by allowing us to subpoena witnesses and documents during investigations and to bring actions in Chancery Court to stop illegal activities, collect fines, and remove charitable corporate status.
Corporations – Senate Bill 3060 and House Bill 515 (effective July 1, 2009) amends the business corporation and nonprofit corporation laws. The corporate reinstatement laws have been revised to make it much easier and quicker for administratively dissolved corporations to become reinstated. Senate Bill 3060 also gives our office the authority to adopt rules to reduce the cost of online corporate filings and to provide for expedited filing services for corporations. We will be finalizing these rules later this year. Currently the only filing accepted online is the corporate annual reports; however, we expect to be adding other filings that can be made online.
Securities – House Bill 781, the Mississippi Securities Act (effective January 1, 2010) adopts the Uniform Securities Act of 2002 in Mississippi to replace our existing, outdated securities act and will bring Mississippi into uniformity with federal law and the most current securities laws in other states. Like the changes to the charities laws, this act will enhance the enforcement powers for our office to investigate and enforce the law against dishonest companies and salespeople. It will also ease regulatory burdens on multi-state companies that sell securities in Mississippi. The Securities Division is working on new regulations to implement the Act, which will also become effective January 1, 2010.
Trademarks – Senate Bill 2641 (effective July 1, 2009) makes changes to the Mississippi’s trademark laws to include the most current protections under federal law and make it easier for businesses that have Mississippi registered trademarks to prove claims of trademark dilution. The amendments allow businesses that have famous trademarks to enforce their trademark rights against those businesses that would damage the mark’s reputation. In addition, the changes to the trademark law provide greater protections both to businesses that use competitors’ trademarks in comparative advertising and to media outlets that use trademarks in news reporting.
Limited Liability Companies – House Bill 683 (effective January 1, 2011). The Limited Liability Companies Study Group recommended the adoption of a comprehensive revised act, based in part on Delaware’s LLC Act. This act also requires LLCs to file annual reports and pay an annual fee, similar to the reports and fees corporations pay. The only difference from the bill recommended by the study group was the amount of annual report fees to be paid by LLCs (which will be no fee for domestic LLCs and $250 for foreign LLCs).
Trade Names– Senate Bill 2003 (effective July 1, 2010) creates a system for the registration of trade names (also called fictitious names, assumed names, or DBAs). A trade name is a fictitious or assumed name other than an individual’s or business entity’s legal name that one business uses to distinguish itself from another. Most states have adopted laws governing the registration and use of trade names, as these laws generally impose little burden on businesses while protecting the public from unscrupulous parties. The Act, as adopted, was identical to the version recommended by the Secretary of State’s Trade Names Study Group.
Uniform Commercial Code (UCC) and Debtor-Creditor Laws– Senate Bill 2419 (effective July 1, 2010). The Uniform Commercial Code Study Group recommended the adoption of revised Article 1 and amendments to Articles 3 and 4 (as set forth in the official text of the UCC by the Uniform Law Commission). In addition, the group recommended some other changes to the state’s UCC laws and the adoption of some non-uniform choice of law language. The adopted version contains some changes from the bill proposed by the study group, including the removal of the non-uniform choice of law language and some other changes to Articles 3 and 4.