Creating a legal entity for your organization can seem like a daunting task. Many people believe that they need to register their organization with the government to establish their legal status and protect their intellectual property rights. However, there is an alternative process known as "recording statutes" or "notice filing."
- [EXAMPLE: A notice filing is a filing
made by an investment adviser with a state securities regulator, as required by
state securities laws. The filing is typically made when an investment adviser
is not required to register with the state, but is still required to file
certain documents and pay a fee in order to conduct business in that state.
To complete a notice filing, an investment
adviser will typically need to provide basic information about the firm and its
business, including the firm's name and address, the name and contact
information for its principal(s), and the types of advisory services offered.
In addition, the adviser may need to provide copies of certain documents, such
as its Form ADV (which provides information about the firm's business,
operations, and conflicts of interest), and proof of registration with the SEC
or other states.
The specific requirements for completing a
notice filing can vary depending on the state in which the adviser is doing
business. It is important for advisers to review the relevant state securities
laws and regulations to ensure that they are in compliance with all filing
requirements. In some cases, advisers may also need to obtain additional
licenses or permits in order to conduct business in a particular state.]
Recording your organization's creation documents without registering them involves filing the necessary documents with the appropriate government agency, such as the Secretary of State's office, to provide public notice of your organization's existence and legal status. This process can be useful for organizations that do not want to be subject to government regulation or oversight, but still want to establish their legal status and protect their intellectual property rights.
- [EXAMPLE: Let's say the startup has
developed a new software application and wants to protect its intellectual
property rights by filing for a provisional patent. The startup can file a
provisional patent application with the United States Patent and Trademark Office
(USPTO) without registering their business. This will establish their legal
ownership of the invention and give them the ability to pursue a patent in the
Additionally, the startup can protect its brand by using trademarks. They can use the ™ symbol to indicate that they claim trademark rights in their company name or product name.
This does not require registration with the United States Patent and Trademark Office (USPTO) and is a way for the startup to establish its legal status and protect its intellectual property rights.]
The process of recording your organization's creation documents without registering them can take different forms depending on the state you are in. One option is to create a common law entity. This involves drafting and signing legal documents, such as articles of association or articles of incorporation, that define the purpose, structure, and governance of the organization. Once the documents are signed, they can be recorded with the county clerk's office or other appropriate government agency. This creates a public record of the organization's existence and provides evidence of its legal status as a common law entity.
Another option for recording your organization's creation documents without registering them is to follow the process of recording with notice. This involves filing your organization's formation documents with the appropriate government office and then publishing a notice of your organization's existence in a local newspaper or other designated publication. By doing so, you provide notice to the public of your organization's existence and can establish certain legal protections and benefits, such as limited liability for members or directors. However, it's important to note that the exact requirements for recording with notice can vary by state.
- [EXAMPLE: Here's an example of a notice
that a non-profit organization might need to publish after filing their
"Notice of Formation of [Name of Non-Profit Organization] Notice is hereby given that [Name of Non-Profit Organization], a non-profit corporation, was filed with the [Name of State] Secretary of State on [Date of Filing], in accordance with the [Name of State] Nonprofit Corporation Act. The office of the corporation is located in [City and State of Registered Office].
The purpose of the corporation is to [Brief description of the organization's purpose or mission].
The initial registered agent of the corporation is [Name and Address of Registered Agent].
Dated: [Date of Notice]
[Name of Non-Profit Organization] By: [Name and Title of Authorized Officer]"
After filing this notice with the appropriate government office, the non-profit organization may be required to publish a notice of their formation in a local newspaper or other designated publication, as required by state law. The purpose of this notice is to provide public notice of the organization's existence and to ensure that interested parties have the opportunity to object or raise concerns, if applicable.]
Here are some possible reasons why someone may choose not to register their organization with the government:
government oversight and regulation: By not registering, an organization
may be able to operate outside of the government's jurisdiction and avoid
certain legal requirements, such as filing annual reports or paying
[EXAMPLE: An example of avoiding government oversight and regulation by not registering your organization is illustrated by the case of a small group of hobbyists who formed an association to collect and preserve antique weapons. The members were concerned that registering their organization would subject them to certain regulations and taxes, which they deemed unnecessary and burdensome. Instead, they decided to create a common law entity by recording their creation documents with the county clerk's office. By doing so, they were able to establish their organization's legal status and protect their intellectual property rights, while avoiding government oversight and regulation.]
privacy: Registered organizations are often required to disclose certain
information to the government, such as the names of their officers and
directors. By not registering, an organization may be able to keep this
time and money: Registering an organization with the government can be a
lengthy and costly process, especially if legal assistance is needed. By
not registering, an organization may be able to avoid these expenses.
flexibility: Registered organizations are often subject to specific legal
requirements and restrictions. By not registering, an organization may be
able to maintain more flexibility in its operations and decision-making.
intellectual property: Some organizations may choose not to register with
the government in order to protect their intellectual property, such as
trademarks or copyrights, without being subject to government regulations
It's important to note that while there may be some benefits
to not registering with the government, there are also potential drawbacks and
risks, such as the lack of legal protections and limitations on access to
funding or resources.
[EXAMPLE: Here's an example of an organization that may choose not to register with the government in order to protect their intellectual property: Imagine a small creative agency that provides graphic design and branding services to clients. The agency may choose not to register with the government in order to protect their intellectual property, such as their company name or logo, without being subject to government regulations or oversight. Instead of registering their trademark with the United States Patent and Trademark Office (USPTO), the agency may choose to use the ™ symbol next to their company name or logo to indicate that they claim trademark rights. This can help establish the agency's brand identity and protect against other businesses using similar names or logos. Additionally, the agency may choose to copyright their original creative work, such as designs or artwork, without registering with the United States Copyright Office. By including the copyright symbol (©) and the year of creation on their work, the agency can establish their ownership and deter others from copying or using their work without permission. While registering with the government can provide additional legal protection, choosing not to register can be a viable option for some organizations that prioritize protecting their intellectual property without being subject to government regulations or oversight. However, it's important for the organization to consult with an attorney to ensure that they are taking appropriate steps to protect their intellectual property and are in compliance with all relevant laws and regulations.]
If you are considering not registering your organization with the government, it's important to weigh the potential benefits and drawbacks. While protecting your intellectual property or avoiding government regulations may seem appealing, it's important to recognize that there may be limitations on access to funding or resources and a lack of legal protections.
To make an informed decision, it's crucial to seek guidance from legal and financial professionals who can help you understand the potential implications and navigate any challenges. By carefully considering the options and seeking expert advice, you can make a decision that aligns with your goals and supports the success of your organization.
So, if you're considering not registering with the government, take the time to consult with legal and financial experts and carefully evaluate the potential risks and benefits. Don't hesitate to take action to ensure that you are making the best decision for your organization's future.
Common law entities have a rich history dating back centuries. In England, common law entities were recognized as early as the 12th century, when the legal system began to develop in its modern form. At that time, the king was the ultimate authority in legal matters, but local judges began to interpret and apply the law in their own jurisdictions, creating a body of case law that became known as "common law."
Common law entities emerged as a way for groups of individuals to come together for a common purpose, such as a business venture or charitable organization. These entities were not created by statute or charter, but instead were recognized by the common law as having legal status and rights. They were typically formed by drafting and signing legal documents, such as articles of association or articles of incorporation, that defined the organization's purpose, structure, and governance.
In the United States, common law entities played an important role in the development of the country's legal system. In the early days of the Republic, there was no federal law governing corporations, so businesses and other organizations were often organized under the common law. This allowed for greater flexibility in terms of governance and ownership, but also created some legal uncertainty, as the rights and responsibilities of common law entities were not always clear.
Over time, states began to adopt statutes governing corporations and other forms of business organization, which provided more certainty and stability for these entities. However, even today, common law entities continue to exist in many forms, including partnerships, trusts, and unincorporated associations. While they may not have the same legal protections and benefits as registered entities, they can still be a useful way for individuals and groups to come together for a common purpose.
In conclusion, the history of common law entities shows that recording your organization's creation documents without registering them has been a longstanding practice for organizations that prefer to operate without government regulation or oversight. While this option may not provide the same legal protections and benefits as registering your organization with the government, it can still establish your organization's legal status and protect your intellectual property rights. Ultimately, the decision to register or not register your organization should be carefully considered and based on your specific goals, needs, and circumstances.
Knowledge is power! Share this blog post with your entrepreneurial friends and family to educate them on the benefits of common law entities.