By Cynthia Schafer Pela
Are you working or engaging in business under an assumed business name? Do you intend to in the near future? If so, hopefully you already know that North Carolina law requires individuals, partnerships, companies and corporations engaging in business under an assumed business name to file an assumed business name certificate.
This registration requirement is designed to give the public a way to ascertain a person or legal entity’s true name for a variety of reasons, such as verifying ratings, searching for judgments or liens and serving individuals or legal entities with notice of a lawsuit.
What you may not know is that effective as of December 1, 2017, the North Carolina General Assembly has revised the law regarding assumed business names. Primarily, the revisions establish a statewide online searchable database of assumed business name filings and simplify the filing process.
The first step in understanding the revisions of the assumed business name law is to first define the term “assumed business name.” According to North Carolina General Statute §66-71.3(1)(a)(e) and (f), an assumed business name is “any name other than the real name of the individual.” In the case of a limited liability company (LLC), it is “any name other than the name stated in its articles of organization filed with the Secretary of State,” or in the case of a corporation, “any name other than the name stated in its articles of incorporation filed with the Secretary of State.”
Next, we look at the law’s requirements. North Carolina law has always required that an assumed business name certificate be filed in the register of deeds office in the county where the person or legal entity is or will engage in business before actually engaging in business using the assumed name. A new feature of the law, however, allows a person or legal entity engaging in business in multiple counties to file a certificate in only one of those counties, instead of in each county where conducting business. In fact, a person or legal entity will have the additional option of selecting that they conduct business in all 100 counties in North Carolina, rather than listing multiple counties. When filed with the register of deeds, the certificate is recorded and indexed in that county, and within 30 days, the register of deeds must transmit the certificate to the Secretary of State’s office for entry into the central database.
So how do you file an “assumed business name certificate”? A new assumed business name certificate form is available on the North Carolina Secretary of State’s website. Although use of this form is not mandatory, it is designed to include all of the information required by the revised law. The certificate must include:
(1) the assumed business name
(2) the real name of the person or legal entity engaging in business under the assumed name
(3) the nature of the business
(4) the physical street address of the principal place of business
(5) each county where the person or legal entity uses or will use the assumed name to conduct business
Additionally, the certificate must be signed by the individual, or in the case of a legal entity, by an individual authorized to act for the legal entity. However, it is no longer required that the certificate be signed in the presence of a notary.
Once complete, you present it for recording at the register of deeds office.
Another new feature of the revised law requires that any change in information provided in the assumed business name certificate be updated within 60 days of its change with the filing of a certificate of amendment. This certificate of amendment must also be filed with the register of deeds office in the county where the assumed business name certificate was originally filed. The certificate of amendment must include:
(1) both the assumed business name and the real name of the person engaging in business under the assumed name as stated in the original certificate
(2) the book and page number where the original certificate was filed with the register of deeds
(3) the SOS ID, or identification number assigned to the assumed business name by the Secretary of State
(4) an explanation of how the assumed business name certificate is to be amended
Perhaps the most exciting new feature of the revised law is that the Secretary of State will now maintain a searchable, centralized online statewide database of assumed business name information available on the Secretary of State’s website. One caveat is that only filings made on or after December 1, 2017, will be searchable on the North Carolina Secretary of State’s website. Filings pre-dating December 1, 2017, must still be searched for in the office of the register of deeds.
Finally, what happens if you have already filed an assumed business name certificate that is before December 1, 2017? Good news: Your existing assumed name certificate is still valid; however, you are required to file a new assumed name certificate no later than December 1, 2022, in order for your assumed business name certificate to remain valid.