Bill Text: NY S02255 | 2019-2020 | General Assembly | Introduced
Bill Title: Requires limited liability companies and foreign limited liability companies to amend their articles of organization to include a list of beneficial owners and to provide certain information relating to each beneficial owner.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2020-01-08 - REFERRED TO CORPORATIONS, AUTHORITIES AND COMMISSIONS [S02255 Detail]
Download: New_York-2019-S02255-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 2255 2019-2020 Regular Sessions IN SENATE January 23, 2019 ___________ Introduced by Sens. HOYLMAN, KRUEGER -- read twice and ordered printed, and when printed to be committed to the Committee on Corporations, Authorities and Commissions AN ACT to amend the limited liability company law, in relation to requiring limited liability companies to amend their articles of organization to include a list of beneficial owners and provide certain information relating to each beneficial owner The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 102 of the limited liability company law is amended 2 by adding a new subdivision (d-1) to read as follows: 3 (d-1) (1) "Beneficial owner" means a natural person who, directly or 4 indirectly, (A) holds a membership interest in a limited liability 5 company or a foreign limited liability company; or (B) has been assigned 6 a membership interest in a limited liability company or a foreign limit- 7 ed liability company. 8 (2) The term "beneficial owner" shall not include: (A) a minor child; 9 (B) a person acting as a nominee, intermediary, custodian, or agent on 10 behalf of another person; (C) a person acting solely as an employee of a 11 limited liability company and whose control over or economic benefits 12 from the limited liability company derives solely from the employment 13 status of the person; (D) a person whose only interest in a limited 14 liability company is through a right of inheritance, unless the person 15 also meets the requirements of paragraph one of this subdivision; or (E) 16 a creditor of a limited liability company, unless the creditor also 17 meets the requirements of paragraph one of this subdivision. 18 § 2. Paragraphs 6 and 7 of subdivision (e) of section 203 of the 19 limited liability company law, as added by chapter 470 of the laws of 20 1997, are amended to read as follows: 21 (6) if all or specified members are to be liable in their capacity as 22 members for all or specified debts, obligations or liabilities of the EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD08557-01-9S. 2255 2 1 limited liability company as authorized pursuant to section six hundred 2 nine of this chapter, a statement that all or specified members are so 3 liable for such debts, obligations or liabilities in their capacity as 4 members of the limited liability company as authorized pursuant to 5 section six hundred nine of this chapter; [and] 6 (7) a list of the beneficial owners of the limited liability company 7 that identifies each beneficial owner by (A) name; (B) current residen- 8 tial or business street address; and (C) a unique identifying number 9 from a non-expired passport issued by the United States or a non-expired 10 driver's license or identification card issued by this or another state; 11 and 12 (8) any other provisions, not inconsistent with law, that the members 13 elect to include in the articles or organization for the regulation of 14 the internal affairs of the limited liability company, including, but 15 not limited to, (A) the business purpose for which the limited liability 16 company is formed, (B) a statement of whether there are limitations on 17 the authority of members or managers or a class or classes thereof to 18 bind the limited liability company and (C) any provisions that are 19 required or permitted to be included in the operating agreement of the 20 limited liability company pursuant to section four hundred seventeen of 21 this chapter. 22 § 3. Section 209 of the limited liability company law is amended to 23 read as follows: 24 § 209. Filing with the department of state. A signed articles of 25 organization and any signed certificate of amendment or other certif- 26 icates filed pursuant to this chapter or of any judicial decree of 27 amendment or cancellation shall be delivered to the department of state. 28 If the instrument that is delivered to the department of state for 29 filing complies as to form with the requirements of law and the filing 30 fee required by any statute of this state in connection therewith has 31 been paid, the instrument shall be filed and indexed by the department 32 of state. The department of state shall not review such articles or 33 certificates for legal sufficiency, except that it shall review such 34 articles or certificates for legal sufficiency with regard to require- 35 ments pertaining to beneficial owners pursuant to sections two hundred 36 three and two hundred eleven of this article; its review shall be other- 37 wise limited to determining that the form has been completed. 38 § 4. Paragraphs 8 and 9 of subdivision (d) of section 211 of the 39 limited liability company law are amended to read as follows: 40 (8) the discovery of a materially false or inaccurate statement in the 41 articles of organization; [and] 42 (9) a change in the list of beneficial owners or the information 43 required to be provided relating to each beneficial owner pursuant to 44 section two hundred three of this article; and 45 (10) the decision to change any other statement in the articles of 46 organization. 47 § 5. The limited liability company law is amended by adding a new 48 section 215 to read as follows: 49 § 215. Beneficial ownership disclosure. (a) A limited liability compa- 50 ny whose original articles of organization were filed with the secretary 51 of state and effective prior to the effective date of this section shall 52 have one year from the effective date of this section to amend its arti- 53 cles of organization to include a list of beneficial owners and the 54 information required to be provided relating to each beneficial owner 55 pursuant to section two hundred three of this article.S. 2255 3 1 (b) Starting one year after the effective date of this section, each 2 limited liability company organized in this state shall submit to the 3 department of state an annual filing, in such format as the secretary of 4 state shall require, containing the list of beneficial owners of the 5 limited liability company and the information required to be provided 6 relating to each beneficial owner pursuant to section two hundred three 7 of this article. 8 (c) The department of state shall establish and maintain a database 9 identifying beneficial owners by name and current residential or busi- 10 ness street address if they are the beneficial owners of two or more 11 limited liability companies required by this article to report its bene- 12 ficial owners to such department. Such database shall be made available 13 to the public on the department of state's website no later than seven 14 days after such information has been received by the secretary of state. 15 Such department shall also establish, through regulations, procedures to 16 allow beneficial owners with significant privacy interests to apply for 17 a waiver from the requirements of this subdivision. 18 (d) Beneficial ownership information relating to each limited liabil- 19 ity company formed under the laws of this state is required to be main- 20 tained by the secretary of state until the end of the five year period 21 beginning on the date that the limited liability company terminates 22 pursuant to this chapter. 23 (e) Any person who: (1) knowingly provides false or fraudulent benefi- 24 cial ownership information; (2) willfully fails to provide complete or 25 updated information; or (3) discloses the existence of a subpoena, 26 summons, or other request for beneficial ownership information shall be 27 liable to the state for a civil penalty of not more than ten thousand 28 dollars and may be imprisoned for not more than three years or both. 29 § 6. Paragraphs 7 and 8 of subdivision (a) of section 802 of the 30 limited liability company law are amended and a new paragraph 9 is added 31 to read as follows: 32 (7) a statement that the foreign limited liability company is in 33 existence in the jurisdiction of its formation at the time of the filing 34 of such application; [and] 35 (8) the name and address of the authorized officer in the jurisdiction 36 of its formation where a copy of its articles of organization is filed 37 or, if no public filing of its articles of organization is required by 38 the law of the jurisdiction of formation, a statement that the foreign 39 limited liability company shall provide, on request, a copy thereof with 40 all amendments thereto (if such documents are in a foreign language, a 41 translation in English thereof under oath of the translator shall be 42 attached thereto), and the name and post office address of the person 43 responsible for providing such copies[.]; and 44 (9) a list of the beneficial owners of the foreign limited liability 45 company that identifies each beneficial owner by (A) name; (B) current 46 residential or business street address; and (C) a unique identifying 47 number from a non-expired passport issued by the United States or a 48 non-expired driver's license or identification card issued by this or 49 another state. 50 § 7. Section 804 of the limited liability company law is amended by 51 adding a new subdivision (c) to read as follows: 52 (c) Every foreign limited liability company that has received a filing 53 receipt entitled "Certificate of authority of .... (name of foreign 54 limited liability company) under section eight hundred five of the 55 Limited Liability Company Law," evidencing authority as provided herein, 56 shall amend its application for authority upon a change in the list ofS. 2255 4 1 beneficial owners or the information required to be provided relating to 2 each beneficial owner pursuant to section eight hundred two of this 3 article, within ninety days of such change. 4 § 8. The limited liability company law is amended by adding a new 5 section 810 to read as follows: 6 § 810. Beneficial ownership disclosure. (a) A foreign limited liabil- 7 ity company whose certificate of authority was filed with the secretary 8 of state and effective prior to the effective date of this section shall 9 have one year from the effective date of this section to amend its 10 certificate of authority to include a list of beneficial owners and the 11 information required to be provided relating to each beneficial owner 12 pursuant to section eight hundred two of this article. 13 (b) Starting one year after the effective date of this section, each 14 foreign limited liability company organized in this state shall submit 15 to the department of state an annual filing, in such format as the 16 secretary of state shall require, containing the list of beneficial 17 owners of the foreign limited liability company and the information 18 required to be provided relating to each beneficial owner pursuant to 19 section eight hundred two of this article. 20 (c) The department of state shall establish and maintain a database 21 identifying beneficial owners by name and current residential or busi- 22 ness street address if they are the beneficial owners of two or more 23 limited liability companies required by this article to report its bene- 24 ficial owners to such department. Such database shall be made available 25 to the public on the department of state's website no later than seven 26 days after such information has been received by the secretary of state. 27 Such department shall also establish, through regulations, procedures to 28 allow beneficial owners with significant privacy interests to apply for 29 a waiver from the requirements of this subdivision. 30 (d) Beneficial ownership information relating to each foreign limited 31 liability company formed under the laws of this state is required to be 32 maintained by the secretary of state until the end of the five year 33 period beginning on the date that the foreign limited liability company 34 terminates pursuant to this chapter. 35 (e) Any person who: (1) knowingly provides false or fraudulent benefi- 36 cial ownership information; (2) willfully fails to provide complete or 37 updated information; or (3) discloses the existence of a subpoena, 38 summons, or other request for beneficial ownership information shall be 39 liable to the state for a civil penalty of not more than ten thousand 40 dollars and may be imprisoned for not more than three years or both. 41 § 9. This act shall take effect immediately.
