South Carolina Certificate of Authority

South Carolina certificate of authority is an important document for any out-of-state business that wishes to operate in South Carolina.3 min read

What Is a South Carolina Certificate of Authority?

A South Carolina certificate of authority is a document required by companies that are not registered in South Carolina but intend to operate in the state. Before companies can do business in South Carolina, they must register with the South Carolina Secretary of State. Foreign companies that want to conduct business activities in South Carolina must file for a certificate of authority with the secretary of state. This process, known as foreign qualification, allows foreign entities to operate in South Carolina without registering in the state.

If a limited liability company (LLC) or corporation is registered in a state, it is considered a domestic entity. Companies incorporated outside of a state are known as foreign entities. In this context, the foreign entity is different than a company in another country.

Before a company can register or qualify to file a South Carolina certificate of authority, it should satisfy one of these conditions:

  • Have employees in the state.
  • Have an office and real estate lease in the state.
  • Operate a bank account in the state.
  • Own a vehicle registered in the state.
  • Bid on or handle government contracts.
  • Own real estate property as an absentee landlord.
  • File a lawsuit in the state against another party.
  • Be involved in construction contracts.
  • Have a telecommunications business.

Requirements to Approve Foreign Qualification Application

Failing to register for a certificate of authority might lead to fines or penalties. A foreign entity will need a certificate of authority when dealing with banks, vendors, and licensing agencies. The foreign company must also provide a certificate of good standing or another applicable document from the state of incorporation before the South Carolina Secretary of State can approve the application. The document must be issued within 30 days of filing for foreign qualification.

The application process takes between seven and 10 days. Additional time might be required to process the certificate of good standing from the company's state of incorporation.

When Companies Need a Certificate of Authority

Companies require certificates of authority for several reasons:

  • Recruiting employees that live in that state.
  • As a requirement for opening a physical facility or office within the foreign state.
  • As a prerequisite to entering into a contract or job in another state.