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Door Closing Statute

15/5/19 Door Closing Statute

The “Door Closing Statute” is a state law which bars foreign corporations from bringing an action in court to enforce a contract unless the business is properly registered to do business in the state at the time the contract is entered into.

The process of obtaining a certificate of authority to do business in a given state is quite simple. All a business has to do to procure a certificate of authority is file its articles of incorporation with the Secretary of State and name an agent for service of process.

However, if the business fails to do this, it is deemed a foreign corporation that is not registered to do business in the relevant state, and thus it is subject to this law.

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