Delaware: A Great Place for Business
Delaware is a hub of business activity with over a million businesses, and attracting new corporations and business partnerships at an astounding rate. Just what makes Delaware such an appealing location for new business? For starters, Delaware is a small, business-friendly state, whose population understands the benefits of a strong business community as it relates to jobs and tax collections. Beyond this, there are a number of factors contributing to the appealing business environment. Consider the following:
- Delaware General Corporation Law: Business laws in Delaware are known and understood by lawyers across the nation. In fact, Delaware law is studied in may law schools, and is considered by many to be the "common language of law" among diverse practitioners.
- Court of Chancery: This court, which deals essentially in matters of equity, is the envy of many state court systems. The court has handed down opinions on every area of corporate law imaginable, creating an environment of efficiency and expertise in the court system. Former Supreme Court Justice William Rehnquist praised the court, concluding that corporate litigation has been minimized in Delaware due to the refinements in law afforded by the Court of Chancery.
- Delaware Legislature: Legal statutes are flexible and up to date, always adjusting with the times. The Delaware legislature has a working relationship with the Delaware State Bar, and relies on the Bar to advise and assist in amending corporate legislation without bias.
- The Delaware Rapid Arbitration Act: The DRAA provides an alternative to traditional legal proceedings when it comes to dispute resolution. By expediting arbitration and avoiding trial courts, successful outcomes are likely to be reached to the satisfaction of all parties.
- Legal Statutes for Business Partnerships: Delaware statute leans away from heavy regulation, providing freedom and flexibility for partners to manage their firms as they see fit. In general, Delaware statutory law is considered to be steady, yet malleable.
- Tax credits: Many new startups come to Delaware due to the advantageous tax climate. In Chester County alone, over $1.5 million in tax credits were paid to qualifying businesses within six years.
- Limited Liability Corporations have increased protection against creditors.
- The statutory limitation on personal liability for LLC members results in huge protections for owners. In fact, members cannot be liable for debt left behind by a failed LLC, meaning no owner can lose more money than the original investment made.
- Filing fees and paperwork requirements to start up are minimal in Delaware, and the annual maintenance franchise tax is only $300 per year.
- Privacy laws favor LLC owners in Delaware. In fact, owners need not be identified to the state at all.
-
If you are considering starting up a business, whether in Delaware or elsewhere, it is imperative that you reach out to an attorney. Schedule your free initial consultation with the knowledgeable team of attorneys at The Casper Firm in either our Baltimore or our Washington, D.C. office.
