The Colorado Secretary of State has announced that businesses formed outside of Colorado will be able to file for authority to transact business in Colorado at a reduced rate. The online filing fee to file a Statement of Foreign Entity Authority will be reduced from $125 to $1 for three months starting on September 1.
Generally, a business entity that is formed in another jurisdiction is required to file a Statement of Foreign Entity Authority with the Secretary of State before the entity transacts business or conducts activities in Colorado. Consequences of not filing a Statement of Foreign Entity Authority, if required, include the inability to maintain a proceeding in a Colorado state court for the collection of debts. The Secretary of State could also require payment of fees for the time period when the entity conducted business without filing a Statement of Foreign Entity Authority, and the entity could be subject to a civil penalty of up to $5,000.
This "Fee Holiday" is an excellent way to save a few dollars for out-of-state entities that are considering transacting business in Colorado, as well as for those out-of-state entities who have begun transacting business in Colorado and want to obtain the proper authority. Businesses should consult with counsel to determine whether the conduct of their business requires that they obtain authority to transact business in Colorado or any other state.
Link to Secretary of State News Release: http://www.sos.state.co.us/pubs/pressrel/2011/PR20110817SOFEAfee.html