What is Foreign Qualification?
If your business is formed and currently operates in a different state, then it is considered ‘foreign’ in this scenario. Foreign qualification is the process required to register your business so it can operate within Hawaii in any capacity, including opening a storefront, warehouse, office, or even having a sales rep within the state. Any physical presence will require that you are foreign qualified.
Why Does A Company Need Foreign Qualification?
Why You Need To Do It – Foreign qualification is legally required in order to operate in Hawaii. A business must complete it if it intends to have any kind of physical presence there, and doing so protects the business from any fines or noncompliance penalties.
When Should You Do It? – As soon as a business makes the decision to start operating some portion of your business in Hawaii, it needs to start the ball rolling on foreign qualification. This will help avoid potential delays or issues as you move closer to finalizing your plan. Generally, you will need Hawaii foreign qualification if your company falls under any of the following criteria:
- Has a physical presence in Hawaii
- Buying a property there
- Have remote employees
- Accepts orders in Hawaii
- Owns a bank account in Hawaii
What Happens If Your Entity Does Not Foreign Qualify?
Failing to foreign qualify can bring numerous fines and fees within Hawaii. You may also face tax related penalties, back taxes, and won’t be able to bring a lawsuit forth within the state.
Steps To Obtain Foreign Qualification
There are several basic steps that a business is required to take in order to finalize Hawaii foreign qualification. These steps include the following.
1. Obtain Certificates – You will need to file an Application for a Certificate of Authority to register. You can download this from the Hawaii Department of Commerce and Consumer Affairs website. After completion of the form, you should file it with the Business Registration Division of the Hawaii Department of Commerce and Consumer Affairs via mail, fax, online, or in person. Additionally, you must obtain a Certificate of Existence or Good Standing from the state where you formed your business.
2. Collect And Submit Information – The form will request all basic business information.
LLC
- LLC name as stated in the Certificate of Existence
- Name of the home state
- The principal office mailing address
- A statement that the list of names and addresses of all members and their respective capital contributions will be kept at the principal office until the cancellation of registration
- Registered agent information
- The duration of the LLC, which can be at-will
- The management structure of the LLC
- The names and addresses of members or managers
- Verify if members of the company will/will not be liable for debts, obligations, and liabilities of the company
- An authorized signature
Corporation
- Verify if nonprofit or profit
- The exact name of the Corporation as stated in the Certificate of Good Standing
- The name of the home state
- The original date of formation
- The principal office mailing address
- Registered agent information
- A list of the names, addresses, and offices held by all officers and directors
3. Appoint Registered Agent – Your registered agent will handle most of the hard work related to foreign registration and compliance. Most businesses use a third party entity like DoMyLLC to serve as their registered agent in order to simplify their daily operations.
4. File The Application – Once completed, submit the application online or by mail along with the $50 filing fee and a $1 fee for start archiving.
5. Ongoing Maintenance – Hawaii requires that all foreign and domestic businesses file an annual report in order to remain fully compliant. The process includes a flat filing fee of $15 for LLCs and Corporations alike.
What Is the Difference Between Foreign Qualification And Incorporating?
Incorporation is a process that creates an entirely new business entity. Foreign qualification merely allows you to do business in a state other than the one your business was formed and currently exists in without having to create an entirely new company.
How DoMyLLC Can Assist With Streamlining The Process
Your business has a lot of different elements that you have to focus your attention on. Dealing with Hawaii foreign qualification can be time consuming and even confusing. We take the process over for you and handle everything so you can worry about other matters. We offer:
- Dedicated account managers
- Ongoing, unlimited customer support
- Name availability checks
- Full filing and registration for your business
We get you foreign qualified so you can manage the other parts of your business that need your attention. Contact us today to get started when you’re ready to branch out into Hawaii!
Hawaii Foreign Qualification FAQs
What Paperwork Is Required?
You’ll need to obtain a certificate of existence from the state your business is organized in. Additionally, you must file the Application For Certificate of Authority for Foreign Limited Liability Company or the Application for Certificate of Authority For Foreign Corporation.
What Fees Are Needed?
The basic filing fee in Hawaii is $50, along with a $1 state archives fee.
Who Can File For Foreign Qualification?
Any business located in a state other than Hawaii can file for foreign qualification within the state.
Do You Need An Attorney For Foreign Qualification?
An attorney is not needed to file for foreign qualification. You may still want to talk to your legal team to ensure you legally protect yourself.
What Information Is Needed For The Certificate Of Authority?
All basic business information will be needed. This includes:
- Name of business
- Business address
- Date of formation
- Business purpose and focus
- Names and addresses of members or managers
- Registered agent information
What If My Name Is Not Available?
You’ll have to register a fictitious name in order to operate in the state. This won’t change the name you operate under in your home state, however.
Hawaii Business Resources
Hawaii Office of Secretary of State
Phone:
(808) 586-2744
Address:
Department of Commerce and Consumer Affairs
PO Box 40
Honolulu, HI 96810
If you’re interested in more info on foreign qualification, call 888-366-9552.