HF 536 (LSB 2101YH (6) 88)

HOUSE FILE 536

BY  KLEIN

A BILL FOR

An Act  eliminating requirements relating to the filing of certain reports with the secretary of state by persons holding agricultural land and persons who are business entities.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

DIVISION I
AGRICULTURAL LANDHOLDING RESTRICTIONS BY NONRESIDENT ALIENS AND BUSINESS ENTITIES

    Section 1.  Section 9I.10, subsection 1, Code 2019, is amended to read as follows:
   1.  If the secretary of state finds that a nonresident alien, foreign business, foreign government, or an agent, trustee, or other fiduciary thereof, has acquired or holds title to or interest in agricultural land in this state in violation of this chapter or has failed to timely register as required under section 9I.7 or has failed to timely report as required under section 9I.8, the secretary shall report the violation to the attorney general.
    Sec. 2.  Section 9I.12, Code 2019, is amended to read as follows:
   9I.12  Penalty —— failure to timely file.
   A civil penalty of not more than two thousand dollars shall be imposed, for each offense, upon a nonresident alien, foreign business or foreign government, or an agent, trustee or other fiduciary thereof, who fails to timely file the registration as required by section 9I.7, or who fails to timely file a report required by section 9I.8.
    Sec. 3.  Section 10.1, unnumbered paragraph 1, Code 2019, is amended to read as follows:
   As used in this chapter and in chapter 10B, unless the context otherwise requires:
    Sec. 4.  Section 10D.2, subsection 1, Code 2019, is amended to read as follows:
   1.  The enterprise files a notice with the secretary of state not later than June 30, 2002. The notice shall be a simple statement providing the name of the enterprise and the address of the enterprise’s registered office or registered agent. The notice shall indicate that the enterprise intends to acquire or hold an interest in agricultural land under this chapter. The secretary of state shall file the notice together with reports required for the enterprise as required in chapter 10B.
    Sec. 5.  Section 22.7, subsection 47, Code 2019, is amended by striking the subsection.
    Sec. 6.  REPEAL.  Sections 9I.8 and 9I.9, Code 2019, are repealed.
    Sec. 7.  REPEAL.  Chapter 10B, Code 2019, is repealed.
DIVISION II
UNIFORM LIMITED PARTNERSHIP ACT

    Sec. 8.  Section 488.111, subsection 7, Code 2019, is amended by striking the subsection.
    Sec. 9.  Section 488.209, subsection 1, paragraph d, Code 2019, is amended by striking the paragraph.
    Sec. 10.  Section 488.209, subsection 2, paragraph d, Code 2019, is amended by striking the paragraph.
    Sec. 11.  Section 488.809, subsection 1, Code 2019, is amended to read as follows:
   1.  The secretary of state may dissolve a limited partnership administratively if the limited partnership does not, within sixty days after the due date, do any of the following:
   a.  Pay pay any fee, tax, or penalty under this chapter or other law due the secretary of state.
   b.  Deliver its biennial report to the secretary of state.
    Sec. 12.  Section 488.906, subsection 1, paragraph b, Code 2019, is amended by striking the paragraph.
    Sec. 13.  REPEAL.  Section 488.210, Code 2019, is repealed.
DIVISION III
REVISED UNIFORM LIMITED LIABILITY COMPANY ACT

    Sec. 14.  Section 489.105, subsection 2, paragraph a, Code 2019, is amended to read as follows:
   a.  Delivering to the secretary of state for filing a statement of change under section 489.114, an amendment to the certificate under section 489.202, a statement of correction under section 489.206, a biennial report under section 489.209, or a statement of termination under section 489.702, subsection 2, paragraph “b”, subparagraph (6).
    Sec. 15.  Section 489.114, subsection 4, Code 2019, is amended by striking the subsection.
    Sec. 16.  Section 489.117, subsection 4, Code 2019, is amended by striking the subsection.
    Sec. 17.  Section 489.208, subsection 2, paragraph d, Code 2019, is amended by striking the paragraph.
    Sec. 18.  Section 489.705, subsection 1, paragraph a, Code 2019, is amended to read as follows:
   a.  The limited liability company has not delivered a biennial report to the secretary of state in a form that meets the requirements of section 489.209 within sixty days after it is due, or has not paid, within sixty days after the due date, any fee, tax, or penalty due to the secretary of state under this chapter or law other than this chapter.
    Sec. 19.  Section 489.806, subsection 1, paragraph b, Code 2019, is amended by striking the paragraph.
    Sec. 20.  REPEAL.  Section 489.209, Code 2019, is repealed.
DIVISION IV
IOWA BUSINESS CORPORATION ACT

    Sec. 21.  Section 490.120, subsection 6, unnumbered paragraph 1, Code 2019, is amended to read as follows:
   Except as provided in section 490.1622, subsection 2, the The document must be executed by one of the following methods:
    Sec. 22.  Section 490.120, subsection 12, paragraph c, subparagraph (1), Code 2019, is amended to read as follows:
   (1)  “Filed document” means a document filed with the secretary of state under any provision of this chapter except division XV or section 490.1622.
    Sec. 23.  Section 490.121, subsection 1, paragraph a, subparagraph (3), Code 2019, is amended by striking the subparagraph.
    Sec. 24.  Section 490.125, subsection 2, Code 2019, is amended to read as follows:
   2.  The secretary of state files a document by recording it as filed on the date and time of receipt. After filing a document, except the biennial report required by section 490.1622, and except as provided in sections 490.503 and 490.1509, the secretary of state shall deliver to the domestic or foreign corporation or its representative a copy of the document with an acknowledgment of the date and time of filing.
    Sec. 25.  Section 490.128, subsection 2, paragraph d, Code 2019, is amended by striking the paragraph.
    Sec. 26.  Section 490.140, subsection 25, Code 2019, is amended to read as follows:
   25.  “Principal office” means the office, in or out of this state, so designated in the biennial report, where the principal executive offices of a domestic or foreign corporation are located.
    Sec. 27.  Section 490.141, subsection 3, Code 2019, is amended to read as follows:
   3.  Notice or other communication to a domestic or foreign corporation authorized to transact business in this state may be delivered to its registered agent at its registered office or to the secretary of the corporation at its principal office shown in its most recent biennial report or, in the case of a foreign corporation that has not yet delivered a biennial report, in its application for a certificate of authority.
    Sec. 28.  Section 490.502, subsection 4, Code 2019, is amended by striking the subsection.
    Sec. 29.  Section 490.1420, subsection 1, Code 2019, is amended to read as follows:
   1.  The corporation has not delivered a biennial report to the secretary of state in a form that meets the requirements of section 490.1622, within sixty days after it is due, or has not paid any fee, tax, or penalty due to the secretary of state under this chapter or law other than this chapter, within sixty days after it is due.
    Sec. 30.  Section 490.1508, subsection 3, Code 2019, is amended by striking the subsection.
    Sec. 31.  Section 490.1510, subsection 2, unnumbered paragraph 1, Code 2019, is amended to read as follows:
   A foreign corporation may be served by registered or certified mail, return receipt requested, addressed to the secretary of the foreign corporation at its principal office shown in its application for a certificate of authority or in its most recent biennial report if the foreign corporation meets any of the following conditions:
    Sec. 32.  Section 490.1530, subsection 1, Code 2019, is amended by striking the subsection.
    Sec. 33.  Section 490.1531, subsection 4, Code 2019, is amended to read as follows:
   4.  The secretary of state’s revocation of a foreign corporation’s certificate of authority appoints the secretary of state the foreign corporation’s agent for service of process in any proceeding based on a cause of action which arose during the time the foreign corporation was authorized to transact business in this state. Service of process on the secretary of state under this subsection is service on the foreign corporation. Upon receipt of process, the secretary of state shall mail a copy of the process to the secretary of the foreign corporation at its principal office shown in its most recent biennial report or as shown in any subsequent communication received from the corporation stating the current mailing address of its principal office, or, if none is on file, in its application for a certificate of authority.
    Sec. 34.  Section 490.1601, subsection 5, paragraph g, Code 2019, is amended by striking the paragraph.
    Sec. 35.  Section 490.1701, subsection 3, paragraph b, subparagraph (1), Code 2019, is amended to read as follows:
   (1)  The instrument shall be delivered to the secretary of state for filing and recording in the secretary of state’s office. If the corporation was organized under chapter 524 or 533, the instrument shall also be filed and recorded in the office of the county recorder. The corporation shall at the time it files the instrument with the secretary of state deliver also to the secretary of state for filing in the secretary of state’s office any biennial report which is then due.
    Sec. 36.  Section 490.1701, subsection 3, paragraph c, subparagraph (3), Code 2019, is amended to read as follows:
   (3)  The secretary of state shall not file the instrument with respect to a corporation unless at the time of filing the corporation is validly existing and in good standing in that office under the chapter under which it is incorporated. The corporation shall be considered validly existing and in good standing for the purpose of this chapter for a period of three months following the expiration date of the corporation, provided all biennial reports due have been filed and all fees due in connection with the biennial reports have been paid.
    Sec. 37.  Section 490.1701, subsection 5, Code 2019, is amended by striking the subsection.
    Sec. 38.  REPEAL.  Section 490.1622, Code 2019, is repealed.
DIVISION V
FOREIGN PUBLIC UTILITY CORPORATIONS

    Sec. 39.  REPEAL.  Section 495.3, Code 2019, is repealed.
DIVISION VI
PROFESSIONAL CORPORATIONS

    Sec. 40.  REPEAL.  Section 496C.21, Code 2019, is repealed.
DIVISION VII
COOPERATIVE ASSOCIATIONS CHARTERED PRIOR TO JULY 4, 1935

    Sec. 41.  REPEAL.  Sections 497.22, 497.23, 497.24, 497.25, 497.26, 497.27, 497.28, 498.24, 498.25, 498.26, 498.27, 498.28, 498.29, and 498.30, Code 2019, are repealed.
DIVISION VIII
TRADITIONAL COOPERATIVE ASSOCIATIONS

    Sec. 42.  Section 499.43A, subsection 2, paragraph b, Code 2019, is amended to read as follows:
   b.  The instrument shall be filed with the secretary of state. The cooperative association shall amend its articles of incorporation pursuant to section 499.41 to comply with the provisions of this chapter. The secretary of state shall not file the instrument unless the cooperative association organized under chapter 497 is in compliance with the provisions of chapter 497 at the time of filing. The secretary of state shall not file the instrument unless the cooperative association organized under chapter 498 is in compliance with the provisions of chapter 498 at the time of filing. A cooperative association shall file a biennial report which is due pursuant to section 499.49.
    Sec. 43.  Section 499.43B, subsection 2, unnumbered paragraph 1, Code 2019, is amended to read as follows:
   The instrument shall be filed with the secretary of state. The cooperative association shall amend its articles of incorporation pursuant to section 499.41 to comply with the provisions of this chapter. The secretary of state shall not file the instrument unless the cooperative association is in compliance with the provisions of the chapter in which it was organized at the time of filing. A cooperative association shall file a biennial report which is due pursuant to section 499.49. Upon filing the instrument with the secretary, all of the following shall apply:
    Sec. 44.  Section 499.53, Code 2019, is amended to read as follows:
   499.53  Quo warranto.
   The right of an association to exist or continue under this chapter may be inquired into by the attorney general, but not otherwise. If from its biennial report or otherwise, the secretary of state is informed that it the association is not functioning as a cooperative, the secretary shall so notify the attorney general who, if the attorney general finds reasonable cause so to believe, shall bring action to oust it and wind up its affairs.
    Sec. 45.  Section 499.73, subsection 4, Code 2019, is amended by striking the subsection.
    Sec. 46.  Section 499.76, subsection 1, Code 2019, is amended by striking the subsection.
    Sec. 47.  REPEAL.  Section 499.49, Code 2019, is repealed.
DIVISION IX
CLOSED COOPERATIVES

    Sec. 48.  Section 501.103, subsections 3 and 4, Code 2019, are amended by striking the subsections.
    Sec. 49.  Section 501.106, subsection 4, Code 2019, is amended by striking the subsection.
    Sec. 50.  Section 501.701, subsection 5, paragraph g, Code 2019, is amended by striking the paragraph.
    Sec. 51.  Section 501.811, subsection 1, Code 2019, is amended by striking the subsection.
    Sec. 52.  REPEAL.  Section 501.713, Code 2019, is repealed.
DIVISION X
IOWA COOPERATIVE ASSOCIATIONS ACT

    Sec. 53.  REPEAL.  Section 501A.231, Code 2019, is repealed.
DIVISION XI
REVISED IOWA NONPROFIT CORPORATION ACT

    Sec. 54.  Section 504.112, subsection 1, Code 2019, is amended to read as follows:
   1.  The secretary of state may prescribe and furnish on request forms for an application for a certificate of existence, a foreign corporation’s application for a certificate of authority to transact business in this state, and a foreign corporation’s application for a certificate of withdrawal, and the biennial report. If the secretary of state so requires, use of these forms is mandatory.
    Sec. 55.  Section 504.113, subsection 1, paragraph w, Code 2019, is amended by striking the paragraph.
    Sec. 56.  Section 504.116, subsection 2, Code 2019, is amended to read as follows:
   2.  The secretary of state files a document by recording the document as filed on the date and the time of receipt. After filing a document, except as provided in sections 504.504, or 504.1510, and 504.1613, the secretary of state shall deliver to the domestic or foreign corporation or its representative a copy of the document with an acknowledgment of the date and time of filing.
    Sec. 57.  Section 504.119, subsection 2, paragraph d, Code 2019, is amended by striking the paragraph.
    Sec. 58.  Section 504.141, subsection 31, Code 2019, is amended to read as follows:
   31.  “Principal office” means the office in or out of this state so designated in the biennial report filed pursuant to section 504.1613 where the principal offices of a domestic or foreign corporation are located.
    Sec. 59.  Section 504.142, subsection 8, Code 2019, is amended to read as follows:
   8.  Written notice is correctly addressed to a domestic or foreign corporation authorized to transact business in this state, other than in its capacity as a member, if addressed to its registered agent or to its secretary at its principal office shown in its most recent biennial report or, in the case of a foreign corporation that has not yet delivered a biennial report, as shown in its application for a certificate of authority.
    Sec. 60.  Section 504.504, subsection 2, unnumbered paragraph 1, Code 2019, is amended to read as follows:
   If a corporation has no registered agent, or the agent cannot with reasonable diligence be served, the corporation may be served by registered or certified mail, return receipt requested, addressed to the secretary of the corporation at its principal office shown in the most recent biennial report filed pursuant to section 504.1613. Service is perfected under this subsection on the earliest of any of the following:
    Sec. 61.  Section 504.1421, subsection 1, Code 2019, is amended by striking the subsection.
    Sec. 62.  Section 504.1508, subsection 4, Code 2019, is amended by striking the subsection.
    Sec. 63.  Section 504.1510, subsection 2, unnumbered paragraph 1, Code 2019, is amended to read as follows:
   A foreign corporation may be served by registered or certified mail, return receipt requested, addressed to the secretary of the foreign corporation at its principal office shown in its application for a certificate of authority or in its most recent biennial report filed under section 504.1613 if any of the following conditions apply:
    Sec. 64.  Section 504.1531, subsection 1, paragraph a, Code 2019, is amended by striking the paragraph.
    Sec. 65.  Section 504.1532, subsection 5, Code 2019, is amended to read as follows:
   5.  The secretary of state’s revocation of a foreign corporation’s certificate of authority appoints the secretary of state the foreign corporation’s agent for service of process in any proceeding based on a cause of action that arose during the time the foreign corporation was authorized to transact business in this state. Service of process on the secretary of state under this subsection is service on the foreign corporation. Upon receipt of process, the secretary of state shall mail a copy of the process to the secretary of the foreign corporation at its principal office shown in its most recent biennial report or in any subsequent communications received from the corporation stating the current mailing address of its principal office or, if none are on file, in its application for a certificate of authority.
    Sec. 66.  Section 504.1601, subsection 5, paragraph g, Code 2019, is amended by striking the paragraph.
    Sec. 67.  REPEAL.  Section 504.1613, Code 2019, is repealed.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   GENERAL. This bill eliminates a requirement that certain persons must file a biennial report with the secretary of state, including persons filing information regarding agricultural land holdings and various business entities, including both domestic and foreign, authorized to do business in this state.
   AGRICULTURAL LANDHOLDINGS. Generally, Code chapter 10B provides a number of reporting requirements for business entities and foreign persons holding agricultural land in this state, including persons holding land under other Code chapters such as Code chapter 9H (e.g., corporations, cooperatives, limited partnerships, trusts, and limited liability companies) and Code chapter 9I (overseas businesses, foreign governments, and nonresident aliens). The person, sometimes referred to as a reporting entity, must file a report with the secretary of state on or before March 31 of each odd-numbered year (Code section 10B.4) unless the person is a business entity filing a biennial report under its respective organizational chapter. The report must contain information about the activities of the person, the person’s landholdings, and agricultural commodities produced on the land. These reporting requirements do not apply to family farm entities such as family farm corporations, family farm limited partnerships, family trusts, or family farm limited liability companies. A reporting entity that fails to file a report is subject to a civil penalty not to exceed $1,000 and $100 per day of the failure (Code section 10B.6). 
   BUSINESS ENTITIES. A business entity is required to file a report with the secretary of state either on an even-numbered or odd-numbered year basis, depending upon the type of business entity. This includes a domestic or foreign business operating on a for-profit, nonprofit, or cooperative basis. It does not include a partnership or limited liability partnership (Code chapter 486A) or a corporation for pecuniary profit organized under Code chapter 491 prior to July 1, 1971 (Code section 491.1). It does include a limited partnership or a foreign limited partnership (Code section 488.210), a limited liability company or a foreign limited liability company (Code section 489.209), a professional limited liability company or foreign professional limited liability company (Code sections 489.209 and 489.1101), a domestic or foreign for-profit corporation (Code section 490.1622), a foreign corporation that owns or controls certain utilities (Code section 495.3), a cooperative association organized prior to July 4, 1935 (Code sections 497.22, 498.24, and 504.1613), a traditional domestic or foreign cooperative association (Code sections 490.122, 499.49, 499.54, and 504.1613), a domestic closed cooperative (Code section 501.713), a domestic or foreign cooperative subject to the Iowa cooperative associations Act (Code section 501A.231), and a domestic or foreign nonprofit corporation (Code section 504.1613).
   Generally, a report contains information regarding the business entity’s current status including its identity (e.g., name, business location, the mailing address of its registered office and registered agent for service of process, and its principal place of business), and in the case of a foreign business entity, the state or other jurisdiction under which it was organized or formed. The failure to file a complete report and fee with the office may be cause for administrative dissolution (e.g., Code sections 490.1420 and 504.1421).