Eleanor Finch
The definition of doing business in New York is a complex topic, with specific circumstances dictating whether an activity constitutes doing business. Foreign manufacturing organizations operating in New York are considered doing business due to their substantial regular business activities. Conversely, occasional or sporadic sales, research, and employee training may not meet the threshold. New York's laws provide a non-exhaustive list of activities that do not constitute doing business, such as acquiring security interests in property or holding board meetings in the state. To operate in New York, businesses must register with the county clerk's office, paying fees based on their business type and location, and comply with naming regulations.
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What You'll Learn
Foreign manufacturing organisations must register
Maintaining an office in New York State by officers or directors of the corporation who are not employees does not constitute doing business if the corporation is not otherwise conducting business in the state. Similarly, keeping books or records of a corporation in New York State does not constitute doing business if the corporation does not have employees in the state and is not otherwise doing business there.
A foreign manufacturing organisation will not be deemed to be doing business in New York State if its activities are limited to certain things, such as acquiring security interests in real or personal property without conducting other business, acquiring title to property through foreclosure, or holding board of directors meetings in the state.
To register as a foreign manufacturing organisation doing business in New York, the organisation must file a "doing business as" (DBA) registration. This allows the company to operate under an assumed or trade name and is necessary for legal compliance. The registration process typically involves submitting the required documents to the county clerk's office and paying associated fees, which vary depending on the business type and location. For example, corporations must pay a fee of $100 per DBA name for each New York City county in which they operate, while LLCs and LLPs pay a filing fee of $25.
In addition to registering a DBA, foreign manufacturing organisations must also secure permits, licenses, and insurance to fully comply with New York business regulations.
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Occasional sales don't count as 'doing business'
The definition of "doing business" in New York is often a source of confusion, and the law does not provide a precise definition. Instead, it offers a non-exhaustive list of activities that do not constitute doing business. Occasional or sporadic sales activities typically do not amount to "doing business" in New York. For example, entering into one or two contracts in New York generally does not constitute "doing business." Similarly, advertising a foreign company in New York newspapers, without more, is insufficient to qualify as "doing business."
However, combining such advertising with the employment of an answering service may indicate an intent to do business in New York. In addition, while owning and leasing real estate as an incidental part of another business does not constitute "doing business," if a foreign entity's sole purpose is land leasing or acquisition, it does qualify as "doing business" in New York.
The determination of what constitutes "doing business" in New York depends on the specific circumstances of each case. For example, a foreign manufacturing organization operating in New York qualifies as "doing business" because manufacturing constitutes a substantial part of its regular business. Conversely, conducting research and employee training in New York does not meet the threshold for requiring registration unless the organization's primary purpose is research and training.
Occasional or casual corporate presence in New York, without additional substantial activity, does not amount to "doing business." For instance, a company with a small New York office handling requests for space on flights originating outside the U.S. was deemed to be "doing business" in New York. On the other hand, a correspondence school chartered in another state that primarily solicits students and handles materials and fees does not qualify as "doing business" in New York. However, if the school maintains multiple in-state offices with staff offering instruction, it crosses the threshold.
Therefore, while occasional sales or contracts may not constitute "doing business" in New York, other factors such as the nature of the business, the extent of the corporate presence, and the intention to do business in the state may also be relevant in determining whether an entity is "doing business" in New York. It is important to note that failing to qualify as a foreign entity while conducting business in New York may result in legal consequences, including the inability to access New York courts until the necessary authority is secured and all fees, taxes, and penalties are settled.
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Registering a DBA is necessary for legal compliance
The definition of "doing business" in New York can be a complex issue, and the law offers a non-exhaustive list of activities that do not constitute doing business. For example, occasional or sporadic sales activities or entering into one or two contracts in New York do not typically qualify as "doing business." On the other hand, a foreign manufacturing organization operating in New York qualifies as "doing business" because manufacturing constitutes a substantial part of its regular business.
Registering a DBA (Doing Business As) in New York State is necessary for legal compliance. A DBA allows businesses to operate under a name different from their legal name, which can provide benefits such as better marketing and branding. All businesses, regardless of their structure, must register with the county clerk's office and pay associated fees, which vary depending on the business type and location. For example, corporations must pay a fee of $100 per DBA name for each New York City county in which they operate.
To register a DBA in New York, businesses must complete an assumed name application and submit it to the New York State Department of State. The application requires information such as the exact name of the entity, the assumed name for the business, and the address of its principal place of business in New York State. It is also essential to evaluate the cost-benefit of acquiring an assumed name for the specific business type. Consulting with legal and tax professionals can help businesses navigate the DBA registration process and ensure compliance with all state and local regulations.
After registering a DBA, businesses should take several steps to ensure their success and legal compliance. These steps include opening separate business and personal bank accounts to distinguish between personal and business funds and obtaining liability insurance. Additionally, businesses should form a marketing plan, especially when managing multiple DBAs, to establish their online presence and advertise their brand and services effectively.
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Corporations must pay a fee per DBA name
In New York, all businesses, including corporations, must register a DBA (Doing Business As) to operate under an assumed or trade name. This process involves submitting the required documents and paying a fee. The cost of registering a DBA for a corporation in New York City is $100 per DBA name for each of the five counties (New York, Kings, Queens, Bronx, and Richmond) within the city where they operate. This amounts to a total fee of $500 for corporations registering a DBA within New York City.
Corporations must submit a completed Certificate of Assumed Name, along with the appropriate filing fee, to the New York Department of State. The certificate must include the exact name of the entity, which can be found on the filing receipt issued by the Department of State when the entity was formed or authorized to do business in New York State. It is important to note that the name should comply with New York's naming regulations and not infringe on any existing trademarks. The certificate must also include the address of the principal place of business in New York State and the address of each location where business will be conducted under the assumed name.
The filing fee for corporations registering a DBA in New York City is $100 per county, while it is $25 for each county outside of the city. This fee is compulsory and must be paid for each DBA name used in each county. In addition to the state filing fee, there may be an additional county filing fee based on the counties in which the corporation does business or intends to do business. The county filing fee is typically $25 per county, but it is $100 for each of the five counties within New York City.
It is important to note that there may be additional fees for specific business types, such as expedited processing services, which require a separate payment. These fees can vary depending on the level of service requested, such as two-hour processing, same-day service, or 24-hour service. To make any changes to the DBA, corporations must fill out an amendment certificate form and pay a fee of $25. Obtaining certified copies of the certificate may also incur additional costs.
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Foreign companies must do more than advertise
Foreign companies must be aware that simply advertising their business in New York newspapers or other media is not sufficient to qualify as "doing business" in the state. The definition of "doing business" in New York is often ambiguous, and the law provides a list of activities that do not constitute doing business, rather than a precise definition.
For example, entering into one or two contracts, occasional sales activities, or sporadic deliveries from an out-of-state factory typically do not constitute "doing business." However, combining advertising with other activities, such as employing an answering service or systematically soliciting and servicing New York clients through on-site representatives, indicates an intent to do business in the state.
Foreign companies must also consider other factors, such as maintaining an office in New York, keeping books or records in the state, or having officers or directors based there. If a foreign company's primary purpose is land leasing or acquisition, it qualifies as "doing business" in New York, even if it is an incidental part of another enterprise.
To operate in New York, all businesses must register with the county clerk's office and comply with naming regulations, ensuring their chosen name is unique and does not infringe on existing trademarks. This process includes submitting the required documents and paying associated fees, which vary depending on the business type and location. For example, corporations must pay a fee of $100 per DBA name for each county in which they operate.
Additionally, businesses must obtain necessary permits, licenses, and insurance to comply with legal requirements. Registering a "doing business as" (DBA) allows companies to operate under an assumed or trade name, providing benefits such as increased professionalism and flexible branding.
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Frequently asked questions
There is no precise definition of "doing business" in New York, but the law provides a non-exhaustive list of activities that do not constitute doing business.
Owning and leasing real estate as an incidental part of another enterprise does not constitute doing business. However, if a foreign entity's sole purpose is land leasing or acquisition, it does qualify as doing business in New York.
Advertising a foreign company in New York newspapers is generally insufficient to qualify as doing business. However, combining such advertising with the employment of an answering service indicates an intent to do business in New York.
Maintaining a small New York office with a few full-time and part-time employees was deemed as doing business in New York. However, merely keeping books or records of a corporation in New York does not constitute doing business if the corporation does not otherwise do business in the state.
Entering into one or two contracts in New York typically does not constitute doing business.
