NY Bus Corp L § 1503 (2021)
2021 New York Laws BSC - Business Corporation Article 15 - Professional Service Corporations 1503 - Organization.

§ 1503. Organization.  (a)   Notwithstanding   any  other  provision  of  law,  one  or  more individuals duly authorized by  law  to  render  the  same  professional service  within  the  state  may  organize,  or cause to be organized, a professional service corporation for pecuniary profit under this article for the purpose of rendering the same professional service, except  that one  or more individuals duly authorized by law to practice professional engineering, architecture, landscape  architecture,  land  surveying  or geology  within  the  state  may  organize,  or cause to be organized, a professional  service  corporation  or  a  design  professional  service corporation  for  pecuniary profit under this article for the purpose of rendering such professional services as such individuals are  authorized to practice.  (b)  The  certificate  of  incorporation  of  a  professional  service corporation shall meet the requirements of this chapter  and  (i)  shall state  the profession or professions to be practiced by such corporation and the names and residence addresses of all individuals who are  to  be the  original  shareholders, directors and officers of such corporation, and (ii) shall have  attached  thereto  a  certificate  or  certificates issued  by  the licensing authority certifying that each of the proposed shareholders, directors and officers is authorized by law to practice  a profession  which the corporation is being organized to practice and, if applicable, that one or  more  of  such  individuals  is  authorized  to practice  each  profession  which  the corporation will be authorized to practice.  (b-1) The  certificate  of  incorporation  of  a  design  professional service  corporation  shall  meet  the  requirements  of  this  chapter, provided that shareholders may include employee  stock  ownership  plans (ESOPs)  and  employees  of  the  corporation  not  licensed  as  design professionals, and provided further however that:  (i) greater than seventy-five percent of  the  outstanding  shares  of stock of the corporation are owned by design professionals,  (ii)  an ESOP, either in part or in its entirety, shall not constitute part  of  the  greater  than  seventy-five  percent  owned   by   design professionals,  (iii)  greater  than  seventy-five percent of the directors are design professionals,  (iv) greater than seventy-five percent  of  the  officers  are  design professionals,  (v)  the  president, the chairperson of the board of directors and the chief executive officer or officers are design professionals, and  (vi) the single largest shareholder is either a design professional or an ESOP with greater than seventy-five  percent  of  the  plan's  voting trustees  being  design  professionals  and  greater  than  seventy-five percent of the plan's committee members being design professionals.  (b-2) The  certificate  of  incorporation  of  a  design  professional service corporation shall:  (i)  state  the  profession  or  professions  to  be practiced by such corporation,  (ii) state the names and residence addresses  of  all  individuals  or ESOPs who are to be the original shareholders, directors and officers of such corporation,  (iii)   indicate  the  profession  or  professions  of  each  original shareholder, director and officer who is a design professional,  (iv) state the ownership interest of each original shareholder, and  (v) indicate the names of the original officers and directors who  are the  president,  the chairperson of the board of directors and the chief executive officer or officers.  (b-3) The  certificate  of  incorporation  of  a  design  professional service  corporation  shall  have  attached  thereto  a  certificate  or certificates issued by the licensing authority certifying that  each  of the  proposed  shareholders,  directors  and officers who is listed as a design  professional is authorized by law to practice a profession which the corporation is being organized to practice and, if applicable,  that one  or  more  of  such  individuals  is  authorized  to  practice  each profession which the corporation will be  authorized  to  practice.  The attached  certificate  or  certificates  shall  also  certify  that  the president, the chairperson of the  board  of  directors  and  the  chief executive  officer  or  officers  are  authorized  by  law to practice a profession which the corporation is being organized to practice.  (b-4) The  certificate  of  incorporation  of  a  design  professional service  corporation  shall  also have attached thereto a certificate or certificates issued by the licensing authority certifying that  each  of the  shareholders,  officers,  directors  and owners have been deemed to have been  of  good  moral  character  as  may  be  established  by  the regulations of the commissioner of education.  (b-5)  On  or  after  January  first,  two  thousand twelve, the state education department and the department of state shall allow an existing professional  service  corporation  organized  under  this  article  and practicing    professional    engineering,    architecture,    landscape architecture, geology or land surveying, or practicing  any  combination of  such professions to become a design professional service corporation as  defined  in  this  article,  provided   the   professional   service corporation   meets   all   of  the  requirements  to  become  a  design professional service corporation, including that its name shall end with the  words  "design  professional  corporation"  or   the   abbreviation "D.P.C.",  by  amending  its  certificate  of  incorporation  so that it contains the following statements:  (1) the names and residence addresses of all individuals or ESOPs  who will  be the shareholders, directors and officers of the original design professional service corporation; and  (2) the profession or professions of each  shareholder,  director  and officer who is a design professional of the original design professional service corporation; and  (3)  the ownership interest of each shareholder of the original design professional service corporation; and  (4) the names of the officers and directors who will be the president, the chairperson of the  board  of  directors  and  the  chief  executive officer   or  officers  of  the  original  design  professional  service corporation.  (i) The  certificate  of  amendment  shall  have  attached  thereto  a certificate or certificates issued by the licensing authority certifying that  each  of  the proposed shareholders, directors and officers who is listed as a design professional is  authorized  by  law  to  practice  a profession  which  the  corporation  is  organized  to  practice and, if applicable, that one or  more  of  such  individuals  is  authorized  to practice  each  profession  which  the corporation will be authorized to practice. The attached certificate or certificates  shall  also  certify that  the  proposed president, the chairperson of the board of directors and the chief executive officer or officers are  authorized  by  law  to practice a profession which the corporation is organized to practice.  (ii)  The  certificate of amendment shall also have attached thereto a certificate or certificates issued by the licensing authority certifying that each of the proposed shareholders, officers, directors  and  owners listed  have  been deemed to have been of good moral character as may be established by the regulations of the commissioner of education.  (iii) The certificate of amendment shall also have  attached  thereto: (A)  a  tax  clearance  issued by the department of taxation and finance certifying that the existing professional service corporation is current with respect  to  payment  of  its  state  tax  liabilities  and  (B)  a certificate  of  good  standing  from  the  state  education  department certifying  that  the  existing  professional  service  corporation   is authorized to provide professional services without restriction.  (b-6)  (1) Prior to the first day of March, two thousand nineteen, the state education department and the department of state  shall  allow  an existing  business  corporation  organized  under  article  four of this chapter to become a professional service corporation as defined in  this article  for  the  purpose  of practicing professional geology, provided that the surviving corporation meet all of the requirements to become  a professional   service   corporation,  including  that  the  name  of  a professional service corporation shall end with the words  "professional corporation"  or  the abbreviation "P.C." by amending its certificate of incorporation so that it contains the following:  (i) the names and residence addresses of all individuals who  will  be the  original  shareholders,  directors and officers of the professional service corporation;  (ii) a statement that the professional service corporation  is  formed pursuant to this section; and  (iii) a statement that the amendment shall not effect a dissolution of the  corporation,  but  shall  be deemed a continuation of its corporate existence, without  affecting  its  then  existing  property  rights  or liabilities  or  the liabilities of its members or officers as such, but thereafter it shall have only such rights, powers and privileges, and be subject only to such other duties  and  liabilities,  as  a  corporation created for the same purposes under this article.  (2)  The  certificate  of  amendment  shall  have  attached  thereto a certificate or certificates issued by the licensing authority certifying that each of the proposed shareholders, directors and officers listed:  (i)  is  authorized  by  law  to  practice  a  profession  which   the corporation  is  organized  to  practice and, if applicable, that one or more of such individuals is authorized to practice each profession which the corporation will be authorized to practice; and  (ii) has been  deemed  to  be  of  good  moral  character  as  may  be established by the regulations of the commissioner of education.  (3)  The  certificate  of amendment shall also have attached thereto a tax  clearance  issued  by  the  department  of  taxation  and   finance certifying  that  the  existing  business  corporation  is  current with respect to payment of its state tax liabilities.  (4)  Notwithstanding  any  provision  of  law  to  the  contrary,  any corporation  formed  under this section shall be required to comply with all applicable laws, rules, or regulations relating to the practice of a profession under title eight of the education law.  (b-7) (1) Prior to the first day of March, two thousand nineteen,  the state  education  department  and the department of state shall allow an existing business corporation  organized  under  article  four  of  this chapter  to  become a design professional service corporation as defined in this article for the  purpose  of  practicing  professional  geology, provided  that the surviving corporation meet all of the requirements to become a design professional service  corporation,  including  that  the name  shall end with the words "design professional service corporation" or  the  abbreviation  "D.P.C."   by   amending   its   certificate   of incorporation so that it contains the following:  (i)  the names and residence addresses of all individuals or ESOPs who will be  the  original  shareholders,  directors  and  officers  of  the professional service corporation;  (ii)  a  statement that the design professional service corporation is formed pursuant to this section;  (iii) the profession or profession of each shareholder,  director  and officer who is a design professional of the original design professional service corporation;  (iv)  the  names  of  the  officers  and  directors  who  will  be the president, the chairperson of the  board  of  directors  and  the  chief executive  officer  or  officers  of  the  original  design professional service corporation;  (v) the ownership interest of each shareholder of the original  design professional service corporation; and  (vi)  a statement that the amendment shall not effect a dissolution of the corporation, but shall be deemed a  continuation  of  its  corporate existence,  without  affecting  its  then  existing  property  rights or liabilities or the liabilities of its members or officers as  such,  but thereafter it shall have only such rights, powers and privileges, and be subject  only  to  such  other  duties and liabilities, as a corporation created for the same purposes under this article.  (2) The  certificate  of  amendment  shall  have  attached  thereto  a certificate or certificates issued by the licensing authority certifying that each of the proposed shareholders, directors and officers listed:  (i)   is  authorized  by  law  to  practice  a  profession  which  the corporation is organized to practice and, if  applicable,  that  one  or more of such individuals is authorized to practice each profession which the corporation will be authorized to practice; and  (ii)  has  been  deemed  to  be  of  good  moral  character  as may be established by the regulations of the commissioner of education.  (3) The certificate of amendment shall also have  attached  thereto  a tax   clearance  issued  by  the  department  of  taxation  and  finance certifying that  the  existing  business  corporation  is  current  with respect to payment of its state tax liabilities.  (4)  Notwithstanding  any  provision  of  law  to  the  contrary,  any corporation formed under this section shall be required to  comply  with all applicable laws, rules, or regulations relating to the practice of a profession under title eight of the education law.  (c)  A  certified copy of the certificate of incorporation and of each amendment thereto shall be filed by the corporation with  the  licensing authority  within  thirty  days  after the filing of such certificate or amendment with the department of state.  (d)  A  professional   service   corporation,   including   a   design professional service corporation, other than a corporation authorized to practice  law,  shall  be  under  the  supervision of the regents of the university of the state of New  York  and  be  subject  to  disciplinary proceedings and penalties, and its certificate of incorporation shall be subject  to  suspension,  revocation or annulment for cause, in the same manner and to the same extent as is provided with respect to individuals and their licenses, certificates, and registrations in  title  eight  of the education law relating to the applicable profession. Notwithstanding the  provisions  of  this  paragraph, a professional service corporation authorized to practice medicine  shall  be  subject  to  the  prehearing procedures  and  hearing  procedures  as  is  provided  with  respect to individual physicians and their licenses in title II-A of article two of the public health law.  (e) A corporation authorized to practice law shall be subject  to  the regulation and control of, and its certificate of incorporation shall be  subject  to  suspension,  revocation  or  annulment  for  cause  by, the appellate division of the supreme court and the court of appeals in  the same  manner  and  to the same extent provided in the judiciary law with respect  to individual attorneys and counselors-at-law. Such corporation need not qualify  for  any  certification  under  section  four  hundred sixty-four  of  the  judiciary law, take an oath of office under section four hundred sixty-six of  such  law  or  register  under  section  four hundred sixty-seven of such law.  (f)   The   order  of  suspension,  revocation  or  annulment  of  the certificate of  incorporation  of  a  professional  service  corporation pursuant  to  paragraphs  (d) and (e) of this section shall be effective upon the filing of such order with the department of state.  (g) The practices  of  creative  arts  therapy,  marriage  and  family therapy,  mental  health  counseling,  and  psychoanalysis  shall not be deemed the same professional service for the purpose of paragraph (a) of this section, notwithstanding that such practices are all licensed under article one hundred sixty-three of the education law.