HBA-ATS H.B. 1351 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 1351
By: Woolley
Business & Industry
2/17/1999
Introduced



BACKGROUND AND PURPOSE 

Current law requires corporations, limited partnerships, registered limited
liability partnerships, or limited liability companies which use an assumed
name to file a certificate with the secretary of state or a county clerk of
the proper county.  The certificate must be executed and acknowledged by an
officer, general manager, member, representative, or attorney in fact,
regardless of where the certificate is filed.  Deleting the requirement of
acknowledgment may result in more efficient review and processing of
certificates and greater consistency in all documents filed with the
secretary of state.  However, county officials have expressed some concern
over the removal of the notarization requirement.   

H.B. 1351 makes a distinction between certificates filed in the Office of
the Secretary of State and those filed in a county clerk's office by
prescribing two distinct  procedures.  If the certificate is filed in the
Office of the Secretary of State, the certificate must only be executed,
thereby eliminating the notarization requirement.  If the certificate is
filed in the office of the county clerk, the certificate must be executed
and acknowledged.  The acknowledgment must be under oath if the certificate
is filed by a representative, attorney in fact, or other identified party. 

This bill also allows the secretary of state to accept reproduced copies of
signed original documents, deletes obsolete transitional provisions,
strengthens the punishment for a violation of Chapter 36 (Assumed Business
or Professional Name) of the Business & Commerce Code, and creates an
offense for the submission of false or fraudulent documents. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 36.11(b), Business & Commerce Code, to prescribe
two specific procedures for filing an assumed name certificate.  If the
certificate is filed in the office of the Secretary of State, this section
requires the certificate to be executed, rather than executed and duly
acknowledged, by the appropriate party for the business entity filing it.
If the certificate is filed in the office of the county clerk, this section
requires the certificate to be executed and acknowledged in the manner
provided by Section 36.10(b) of this code.  Section 36.10(b) requires that
the acknowledgment must be under oath if the certificate is executed by a
participant whose name is not required to be stated on the certificate,
such as a representative, attorney in fact, or other identified party; the
attorney in fact must be authorized in writing and the acknowledgment must
contain a recitation of such authorization.  Makes conforming changes. 

SECTION 2.  Amends Section 36.13, Business & Commerce Code, as follows:

Sec. 36.13.  New title: DURATION AND RENEWAL OF CERTIFICATE.  Deletes
existing Subsections (d) and (e), which are transitional provisions
regarding certificates that have been filed prior to the effective date of
Chapter 36. 

SECTION 3.  Amends Subchapter B, Chapter 36, Business & Commerce Code, by
adding Section  36.18, to authorize the secretary of state to accept a
reproduction of an original document required to be filed in its office.
Provides that the signature on a document required to be filed may be a
facsimile. 

SECTION 4.  Amends Section 36.26, Business & Commerce Code, as follows:

Sec. 36.26.  New title: CRIMINAL PENALTY--GENERAL VIOLATION.  Provides that
a person commits an offense punishable as a Class A misdemeanor if the
person, conducting business or rendering a professional service in this
state under an assumed name, intentionally violates any provision of
Chapter 36. 

SECTION 5.  Amends Subchapter C, Chapter 36, Business & Commerce Code, by
adding Section 36.27, as follows: 

Sec. 36.27.  CRIMINAL PENALTY--FRAUDULENT FILING.  (a) Prohibits a person
from knowingly or intentionally signing and presenting for filing or
causing to be presented for filing a document authorized or required to be
filed under this chapter if the document indicates that the person signing
the document has the authority to act on behalf of the entity for which the
document is presented and the person does not have that authority, if the
document contains a material false statement, or if the document is forged. 

(b) Provides that a person who violates Subsection (a) commits an offense,
and that such an offense is punishable as if it occurred under Section
37.10 (Tampering With Governmental Record), Penal Code.  Under that
section, an offense is punishable as either a Class A misdemeanor; a state
jail felony if the person's intent is to defraud or harm another; or a
felony of the third degree if the governmental record was a license,
certificate, permit, seal, title, letter of patent, or similar document
issued by a governmental entity, by another state, or by the United States,
unless the actor's intent is to defraud or harm another, in which event the
offense is a felony of the second degree. 

SECTION 6.  Makes application of this Act prospective

SECTION 7.  Effective date: September 1, 1999.

SECTION 8.  Emergency clause.