Delaware Corporations
Candlefocus EditorThe Delaware General Corporation Law (DGCL) provides the general legal framework for creating and managing Delaware corporations. This body of laws seeks to protect investors and shareholders, and encourages private enterprise by providing a clear, highly efficient legal structure for businesses. This law has been consistently updated to stay current with changing corporate needs since its initial passing in 1899.
Incorporating in Delaware carries distinct advantages. Banks and credit organizations appreciate the freedom of usury laws to charge high-interest rates, while investors and shareholders benefit from the highest standard of legal protection from both the state and the courts. Additionally, the state does not require corporations to hold annual stockholder meetings or provide financial statements for public viewing. This makes Delaware the top choice for companies that want to remain anonymous or go public without showing financial details.
Delaware also offers substantial incentives to businesses that incorporate in the state, such as low taxes and numerous partner programs. The Delaware Secretary of State awards business certifications to companies that register in Delaware. This provides recognition and credibility to any company, making Delaware the preferred location for publicly traded companies.
For all of these reasons, Delaware corporations are keenly sought out by companies of all sizes. Those registered within the state are viewed as reliable, well-run organizations, with legal compliance and financial security provided by the state and its courts. By registering in Delaware, companies benefit from the framework of its corporate laws, gain publicity from the awarded certifications, and keep greater autonomy over their finances due to the usury laws. It is clear why Delaware is a popular choice for corporate registration.