How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask N Cal Attorney Your Own Question
N Cal Attorney
N Cal Attorney, Attorney
Category: Business Law
Satisfied Customers: 9339
Experience:  Since 1983
Type Your Business Law Question Here...
N Cal Attorney is online now
A new question is answered every 9 seconds

What are the advantages of being a Delaware corporation

Resolved Question:

What are the advantages of being a Delaware corporation?
Submitted: 7 years ago.
Category: Business Law
Expert:  N Cal Attorney replied 7 years ago.
is from the Delaware Division of Corporations and states why they think Delaware is such a popular place to incorporate.

Delaware began to stand out as a corporate haven when its laws began to give corporate management notable latitude in its powers to operate and control the corporation. This latitude has frequently come at the expense of the shareholders' ability to control the corporation.
Delaware's lax corporate laws are important because the United States has an important corporate law doctrine called the "internal affairs doctrine." Pursuant to this rule, corporations which act in more than one state are subject only to the laws of their state of incorporation with regard to the regulation of the internal affairs of the corporation.
As a result, Delaware corporations are subject almost exclusively to Delaware law - even when they do business in many (or even all fifty) states. Without this rule, national corporations would be subject to the varying (and potentially inconsistent) laws of each state. Under this rule, the states have an incentive to have the most relaxed corporate laws to encourage corporate formation (because this results in increased revenues and fees for the state). The reason Delaware is the home of most U.S. corporations[citation needed] is because it has made itself the most attractive in this respect. Whether this was a "race to the bottom" or a "race to the top" - that is, whether this incentive created positive or negative externalities - is a matter of vigorous debate in the academic literature.

I hope this information is helpful.
N Cal Attorney and 5 other Business Law Specialists are ready to help you
Expert:  N Cal Attorney replied 7 years ago.
Thank you for accepting my answer.