The goal of any business is to succeed, and part of the success process is growth. There may come a time when a company expands operations, requiring a bigger workspace, then eventually requiring more workspaces within the city, the state, and finally, other cities or towns in other states entirely.

However, to operate a branch of a business in another state means getting a foreign qualification and securing a certificate of authority. It’s important to understand that the path to do that is not one universal standard.

Different States, Different Needs

Because of the American government structure, states have a lot of autonomy in how they conceive and enforce laws and regulations. This extends to how they address the need for outside businesses to seek foreign qualification and operate within their state lines. All states will have some general procedures, but that application process will differ specifically from one state to the next.

New York State, for example, grants an application for authority. However, New Jersey calls it the certificate of authority, while other states call it the application for registration, qualification certificate, and even application to transact business.

Research Your Procedure

Before taking action to set up business operations in another state, it is critical to understand exactly what procedures a specific state requires to grant foreign qualification status. Failure to do this can result in fines, penalties, back taxes, and more severe legal and financial consequences. 

Each state will have its established protocol for doing so. In New York, for example, businesses only need to undertake the application process available on the state government website, New York Business Express. On the other hand, the state of Georgia requires businesses to send applications directly to the Georgia Secretary of State so that the appropriate administration in that branch of government can process applications.

There are a few more requirements for getting a certificate of authority in Florida. The application here goes to the Florida Department of State, Division of Corporations, and must be accompanied by certificates from your state, all filed by a Florida registered agent operating on your behalf. The requirements also vary based on the type of organization, so corporations have a slightly different procedure from LLCs or non-profit organizations.

It is important to carefully research the state requirements in the area you are expanding or work closely with experienced professionals who specialize in helping companies remain compliant as they grow their business to other states.