How to Get Foreign Qualification in Georgia

Do you own a limited liability company (LLC) created in a state other than Georgia, but you want to expand your business to the The Peach State? If so, you’ll need to qualify your foreign LLC in order to transact business in Georgia.

What is a foreign qualification and how do foreign LLCs function within the state of Georgia? In this guide, we’ll answer these questions and more.

Rocket Tip: If you’d rather hire an online service to handle this process for you, many of the best LLC services can handle it for you.

What Is a Foreign Qualification?

A foreign qualification enables your limited liability company to do business in the state of Georgia. It doesn’t matter which state you originally formed your business in ― or in other words, the state your domestic LLC is located in ― as the qualification process to register a foreign LLC in Georgia is the same regardless of where your domestic LLC is based.

The confusion surrounding foreign qualification usually centers on what it means to “do business” in a state outside of your primary state. This gets especially problematic considering some states don’t strictly define what it means to transact business in that state. Like many states, Georgia does not clearly define what it means to “do business.” However, it has adopted certain provisions of the Revised Model Act, which outlines activities that do NOT qualify as “doing business.” Georgia has also added additional provisions to exclude certain business types.

What Qualifies as ‘Doing Business’ in Georgia

The Georgia Secretary of State does not provide a definition of “doing business.” However, Georgia businesses, both foreign and domestic, are subject to the provisions of the Revised Model Act, meaning that all entities are evaluated on a case-by-case basis.

What Does NOT Qualify as ‘Doing Business’ in Georgia

Under Georgia law, the following activities do not qualify as “doing business” in this state:

• “Maintaining or defending any action or suit or any administrative or arbitration proceeding, or effecting the settlement thereof or the settlement of claims or disputes;
• Holding meetings of its directors or shareholders or carrying on other activities concerning its internal affairs;
• Maintaining bank accounts, share accounts in savings and loan associations, custodian or agency arrangements with a bank or trust company, or stock or bond brokerage accounts;
• Maintaining offices or agencies for the transfer, exchange and registration of its securities, or appointing and maintaining trustees or depositories with respect to its securities;
• Effecting sales through independent contractors;
• Soliciting or procuring orders, whether by mail or through employees or agents or otherwise, where the orders require acceptance without this State before becoming binding contracts and where the contracts do not involve any local performance other than delivery and installation;
• Making loans or creating or acquiring evidences of debt, mortgages, or liens on real or personal property, or recording same;
• Securing or collecting debts or enforcing any rights in property securing the same; “(9) Owning, without more, real or personal property;
• Conducting an isolated transaction not in the course of a number of repeated transactions of a like nature;
• Effecting transactions in interstate or foreign commerce;
• Serving as trustee, executor, administrator, or guardian, or in like fiduciary capacity, where permitted so to serve by the laws of this State;
• Owning (directly or indirectly) an interest in or controlling (directly or indirectly) another entity organized under the laws of, or transacting business within, this state;
• Serving as a manager of a limited liability company organized under the laws of, or transacting business, within this state.”

How to Get Foreign Qualification in Georgia

To obtain Foreign Qualification for your Georgia business, you must obtain a Certificate of Authority. There are different forms depending on the structure of your business, however all forms can be found on the Georgia Secretary of State’s website.

Filing Fee: $225 for LLCs and $200 for Limited Partnerships. Checks must be made payable to “Secretary of State.” The forms can either be submitted online here, or delivered to the Corporations Division of the Secretary of State’s office at the following address:

2 MLK, Jr. Dr. Suite 313, Floyd West Tower Atlanta, GA 30334-1530

What Is the Penalty for Not Getting Foreign Qualification in Georgia?

There are several major penalties for foreign entities that do not register with state of Georgia. The following penalties may apply:

• A fine of $500, in addition to all unpaid application fees
• An unregistered foreign entity cannot maintain any action or proceeding in a Georgia court

Should I Hire a Business Service Provider to File My Georgia Foreign Qualification?

If you don’t want to handle your foreign qualification on your own, you have options. Some entrepreneurs choose to hire a lawyer to prepare and file their Certificate of Authority, which can be a good option if you’re concerned about getting the job done right. However, attorney’s fees can be quite expensive.

The other option is to hire a business service provider like Incfile or ZenBusiness to register your foreign LLC with the state of Georgia.

These companies can typically get your foreign qualification done for a fraction of the price of an attorney. This is our preferred route if you don’t want to go with the DIY option.

Conclusion

Getting Foreign Qualification in Georgia is pretty simple, thanks in part to the intuitive online application procedure. However, just because it is easy does not mean that you should take the foreign qualification process lightly. The penalties for non-compliance can be severe -- especially if you need to bring a lawsuit against a third party in Georgia.

We hope this article managed to answer your questions about obtaining a Georgia foreign qualification, and we wish you a prosperous business future!