Senator Jones Introduces Measure to Assist Small Businesses

Establishes a uniform process for small, owner-run corporations to quickly and easily remedy technical noncompliance issues

Sacramento – State Senator Brian W. Jones (R-Santee) today introduced Senate Bill 218, a measure to allow small, owner-run corporations to handle ministerial paperwork corrections in a more simplified and uniform procedure.

Specifically, SB 218 amends the California Corporations Code so businesses can directly ratify (or petition the superior court to ratify) noncompliant, but otherwise lawful, corporate actions.

Unlike large corporations, which often have in-house counsel, small businesses usually handle most of their own regulatory paperwork.  As these small businesses grow, the owner’s role may expand into new activities, such as seeking outside funding, acquiring other businesses, selling a line of the business (or the entire corporation), or undertaking an initial public offering.  In these activities, minor, unintentional, and technically “non-compliant” paperwork issues may occur.  SB 218 would provide an easy pathway for the business owner to correct the issue, return to compliance, and get back to running their business.

“We want small businesses to be successful and grow, both for the owners and their employees,” stated Senator Brian Jones.  “The state should make it as quick and easy as possible for business owners to correct technical, non-compliant paperwork issues that were simple, honest mistakes.  Business owners should be focusing on running their businesses and providing jobs rather than doing paperwork.  SB 218 will help make this happen.”

SB 218 is sponsored by the California Lawyers Association and is awaiting referral to a policy committee.