The times., 1899-04-16
DELAWARE CORPORATION LAW.
Facilities Afforded for Doing Busi-
ness UnLer II.

rHchties Auorueu Tor Doing busf-
ness Under 1t.
Wilmington, Del, April 15.-The eyes of
capitalists in all parts of the country are
| now turned on Delaware by reason of the
liberal corporation law passed at the last
session of the legislature. 1t is now easy
to get charter for any kind of COM
pany TO DO any kind of business in this
State. So far there have been many ap-
plications for charters, although the pro-
visions of the law are not yet fairly IN
derstood.
comparison between the liberal law of
New Jersey and the recent Delaware act
shows that it is much easier to get a char
ter under the Delaware law, and less ex-
pensive, than in New Jersey. 1t is gem
orally thought that the passage of the
act will result in many concerns coming
to this State for charters instead of soing
to other States. The tax in this State
as one-twentieth of 1 per cent on the cap
ital stock, while the New Jersey tax is
twice this. The Delaware law is also said
TO be much more compact and more readily
understood than the New Jersey law.
1t is easy to obtain charter under the
new law. The proposed incorporators pre-
pare their charter and file a certificate
setting forth the object of the company,
stock each proposes to take and such 9th
er matter as is required by law. The fee
is paid and the secretary of state grants
the charter The company can then pro-
ceed with business. The law does not state
where the main Office of the company shall
be, and does not even provide that the
company shall have an Office in this State.
1t simply provides that one of the incor-
porators shall live in Delaware.
The legislature also passed an additional
act which provides a revenue for the State.
The companies included are required to
make a report to the secretary of state ON
or before the first Tuesday OF January an
nually of the amount of their gross re-
ceipts from business done in this State in
the previous year. On this amount of gross
receipts the tax is imposed. Failure of
the corporation to pay the tax two years
in succession shall work forfeiture Of its
charter, and the attorney general shall
proceed against such corporation in the
court of chancery.
What inducements the State of New
Jersey holds out TO capitalists may be sur
missed from the fact that the tax on cor
porations in that State is and has bssn
for years one-tenth of per cent on SS,
000.0o0 capital one-twentieth Of j per
cent on S5,00000o, and $50 for every ST.
000.0o1 for concerns which have a capital
of more than SJ,e00. coo. The States in
come from its tax on corporations. includ
ing railroad companies, which are taxed
separately. for the year ending October
81. 1899, is estimated at S2.1S6.S70. The
filing fees in the Office of the secretary OF
state amount to about $4,000 a month,
and these fees are collected at an amost
nominal cost to the State.
In 1892 number of prominent Jersey
men and others conceived the idsa Of fa-
cilitating the organization of corporations
by having trust company in New Jersey
which should devote itself wholly to cor
porate matters and affairs A trust COM
pany charter was obtained, and the new
company soon bscame the headquarters OF
interpretations in the State. At the o-e
of 1892 about one hundred and fifty cor-
porations had connected themselves W IL
it. Branches of the company were estab-
lished at East Orange and at Camden
The Corporation Trust Company OF New
Jersey today is said to represent some
thing over one thousand corporations
with total capitalization OF over S1,000.-
G,060, and the Trust Company at East
Orange is said to represent about two
hundred and fifty corporations, with ag-
gregate capitalization of about 5000, ,000,-
Geo, while the company at Camden has in
its Office something like five bundled COR
porations, representing an aggregate
capitalization of $500, eco, COO.
The State of New Jersey in 1896 revisel
it's corporation laws. compelling co pora-
tions TO have and maintain a principal Of
fee within the State of New Jersey. in
which should be kept at all times their
stock and transfer books, and in charge of
which there should be at all times resi-
dent OF the State of New Jersey CT full age
or a corporation authorized by its charter
so TO act. In 1898 the legislature of New
Jersey passed an additional law requiring
every corporation organized under the
laws of New Jersey twice year to f,e
a statement in the Office of the secretary
of state of New Jersey, naming it's priu-
cipal Office by street and number, and pro-
viGing that in case Of failure so to do the
individual stockholders should be liable as
copartners, and further providing that in
case Of a false statement the officers
should be liable for perjury and punish
able by not less than ten years at hard
labor. This act resulted in the exclusion
OF the tramp and bubble" corporations
Apart from these regulations, thers are no
obstacles and no red tape TO prevent the
organization under New Jersey laws of
corporations for any lawful purpose