text:
Beppy Landrum Owen, Esq. | (407) 419-8463 | firstname.lastname@example.com
Florida's Historic Business Trends
Ever since Ponce de Leon first landed on Florida's shores in 1513 in search of the legendary Fountain
of Youth, Florida has been a destination for entrepreneurs with extraordinary dreams and imaginative
commercial activities. Our stories are telling: Spanish explorers found rugged swamplands and saw the
future sites of gleaming cities. Henry Flagler set down a railroad to the remote tropics and opened up a
corridor to Florida winter tourism. Walt Disney built a child's dreamscape, and the world's favorite
Mouse, along with Florida's tourism industry, let loose a "roar heard 'round the world." Our state's
largest city of Miami has been called the Gateway to Latin America, and from our beaches NASA and
now private citizens have launched rockets, satellites and spacecraft connecting us to outer space.
Today Florida remains a land well-suited for the business of big dreams. Tourism remains a hot
industry, though technology, education and healthcare also continue to grow at a rapid pace. Even the
events of the recent economic crisis, serious as they are, have not destroyed Florida's capacity to
dream and create; to the contrary, we're seeing new innovation in fields of medical research and
healthcare, simulation technology, renewable energy, telecommunications, aerospace and
nanotechnology, to name just a few key industries.
Business-Friendly Climate
Florida is well known for its business-friendly climate, both figurative and literal. Well-developed
business laws, low corporate and personal tax rates, lack of state income tax, and favorable geography
make Florida a favored jurisdiction for all domestic and international business. Our 19 commercial
airports, 15 deep water shipping ports and two spaceports are among the busiest commercial sites in
the world. Supported by these ports, "Florida-origin exports" (meaning goods produced or with
significant value addition in Florida) account for more exports to Latin America and the Caribbean than
are exported by any other state. Florida is among the largest recipients of foreign direct investment in
the U.S., and Miami is a favored jurisdiction for international banking second only to New York in the
U.S. Florida supports offices of approximately 150 foreign and domestic banking institutions which
provide financing to other key participants in the commerce of the state. With the fourth largest U.S.
Gross State Product (following only California, Texas and New York) and one of the largest economies
in the Western hemisphere, Florida is a powerful economic engine for domestic and international
businesses alike.
Well-Qualified Workforce
Florida supports and actively develops its well-educated and well-qualified, extraordinarily culturally
diverse workforce particularly in the key industries of technology, tourism and international trade. With
12 public universities, seven medical schools, 12 law schools, dozens of graduate level business
schools and numerous private colleges and independent trade schools, Floridians have great access to
education; in fact, no Floridian lives more than 50 miles from a postsecondary institution of learning.
Florida ranks highly in the U.S. among states with workers with advanced degrees and supports tens of
thousands of international students in its schools and universities, which in turn promotes a vibrant
multicultural workforce.
Public-Private Partnerships
Florida businesses enjoy a coordinated system of economic development initiatives through several
important public-private partnerships. Newcomers to Florida, whether workers or businesses, are
supported by a coordinated system of workforce services administered by the Florida Department of
Economic Opportunity and its divisions to provide state and federal programs and initiatives to help
visitors, citizens, businesses, and communities. The Division of Strategic Business Development
supports the attraction of out-of-state businesses to Florida, promotes the creation and expansion of
Florida businesses and facilitates Florida's economic development partnerships. The Division of
Workforce Services partners with CareerSource Florida (the principal workforce policy organization for
the state) and the state's 24 regional workforce boards to strengthen Florida's business climate by
supporting employers and helping Floridian workers gain and retain employment and advance in their
careers. The Division of Community Development manages Florida's land planning and community
development responsibilities, which helps ensure that new growth fosters economic development while
protecting significant state resources. Enterprise Florida, Inc. provides startup and growth support to
Floridians and newcomers alike, including site selection services, advice on trade and industry trending,
and coordination of introductions to potential economic development partners. Last but certainly not
least, the Florida High Tech Corridor Council supports the high tech industry and its workforce with
economic development initiatives. The efforts of the Florida High Tech Corridor Council have been
recognized by an honors award granted by the International Economic Development Council.
Guide to Doing Business in Florida
In this Guide to Doing Business in Florida (this "Guide") prepared by the lawyers and professionals of
Akerman LLP, Florida's largest law firm (based on the total number of attorneys practicing in the state)
and a longstanding Lex Mundi member firm, you'll find guidance on a large variety of issues confronting
both new and established businesses. Each chapter begins with the contact information of the contributing
authors. Appendix 1 contains a full index of contact information for our contributing authors
and our firm at large. Appendix 2 contains a listing of the state agencies mentioned in the text of this
Guide. Appendix 3 contains an organizational chart showing the basic organizational structure of the
Florida state government.
We hope you'll find this Guide useful as a commentary on general business and legal issues in Florida.
With more than 600 lawyers and other professionals available for deployment in support of your legal
needs, we look forward to providing further guidance and advice on any specific legal issues you may
References and Disclaimers
Statistics for this article were provided by resources listed on Appendix 2.
The information provided in this Guide is current as of January 1, 2016, and is subject to change by
future legislation. This Guide is intended to provide a summary of general business and legal issues in
Florida and should not be relied upon as an alternative to the engagement of legal counsel. Any tax
advice contained herein is not intended or written to be used, and cannot be used, for the purpose of
avoiding tax-related penalties under the Internal Revenue Code or promoting, marketing or
recommending to another party any tax-related matters addressed herein. Nothing contained in this
Guide shall be deemed to be a legal or tax opinion, and no conclusions may be inferred from or are
implied by the statements or discussion contain herein.
We hope you find this Guide of valuable use in your business activities in Florida. We look
forward to helping you, your business, your customers and clients all thrive here in the Sunshine State.
Editor and Lex Mundi Firm Representative
Beppy Landrum Owen, Esq.
Regulation of International Trade and Investment in Florida
Pedro A. Freyre, Esq. | (305) 755-5821 | firstname.lastname@example.com
Felicia L. Nowels, Esq. | (850) 425-1661 | email@example.com
Federal and Florida Antitrust Laws
Christopher S. Carver, Esq. | (305) 982-5572 | email@example.com
Lawrence D. Silverman, Esq. | (305) 982-5666 | email@example.com
1.1 Regulation of International Trade and Investment in Florida
Foreign investment in the U.S. and other international commercial activities involving U.S. entities are
subject to a number of U.S. Federal and State statutes and related regulations. The following discussion
outlines some of the more important aspects of these laws which might be relevant to someone
investing in or trading with entities located in the U.S. It is important to note that apart from the topics
discussed below, certain areas of activity deemed to be sensitive to the national interest are subject to
further scrutiny and regulation. These include, for example, mining, power generation, defense, high
technology, radio and television broadcasting, domestic air and marine transportation and fishing.
1.1.1 USA PATRIOT Act
In October 2001, the U.S. adopted the USA PATRIOT Act, 115 Stat. 272 (2001). The Act
expands the powers of law enforcement officials to counter terrorist threats in the U.S. and
abroad, and strengthens criminal laws against terrorism. It requires financial institutions to
establish comprehensive anti-money laundering programs; to strengthen "know your customer"
procedures; and to conduct enhanced due diligence on all accounts belonging to non-U.S.
persons. As a result, when seeking to engage in various financial transactions in the U.S.,
foreign investors in the U.S., including their families and associates are required to be more
forthcoming with information regarding such matters as ownership status and non-affiliation with
certain individuals and organizations deemed to be adverse to the national security of the U.S.
Potential foreign investors can expect requests for extensive financial information and long
delays in the process of establishing relationships with U.S. financial institutions.
1.1.2 Restrictions on Foreign Investment
Under a statutory provision commonly referred to as the Exon-Florio Amendment (§ 721 of Title
VII of the Defense Production Act of 1950, as added by § 5021 of the Omnibus Trade and
Competitiveness Act of 1988), the President of the United States (the "President") has broad
authority to investigate and prohibit any merger, acquisition or takeover by or with foreign
persons which could result in foreign control of persons engaged in interstate commerce if the
President determines that such merger, acquisition or takeover constitutes a threat to the
national security of the U.S. Congress has indicated that the term "national security" is to be
interpreted broadly and that the application of the Exon-Florio Amendment should not be limited
to any particular industry.
The statute sets out a timetable for investigations of transactions which can take up to 90 days
to complete. The President or his designee has 30 days from the date of receipt of written
notification of a proposed (or completed) transaction to decide whether to undertake a full scale
investigation of the transaction. The President has delegated the authority to make investigations
pursuant to the Exon-Florio Amendment to the Committee on Foreign Investment in the
U.S. ("CFIUS"), an interagency committee made up of representatives of various executive
branch agencies. Notifications of transactions are not mandatory and may be made by one or
more parties to a transaction or by any CFIUS member agency.
If at the end of the initial 30-day period after notification of a transaction, CFIUS decides that a
full-scale investigation is warranted, it then has an additional 45 days to complete an investigation
and make a recommendation to the President with respect to the transaction. The
President then has 15 days in which to decide whether there is credible evidence that leads
the President to believe that the foreign interest exercising control might take action to impair
the national security. If the President makes such a determination, Exon-Florio empowers the
President to take any action which the President deems appropriate to suspend or prohibit the
transaction, including requiring divestment by the foreign entity if the transaction has already
been consummated.
U.S. law also places certain restrictions on acquisitions of businesses which require a facility
security clearance in order to perform contracts involving classified information. Under
Department of Defense regulations, foreign ownership may cause the Department to revoke a
security clearance unless certain steps are taken to reduce the risk that a foreign owner will
obtain access to classified information (DOD5220.22-R). Assuming that a foreign owner will be
in a position to "effectively control or have a dominant influence over the business management
of the U.S. firm," the Department of Defense may require, as a condition to continuation of the
security clearance, that the foreign owner establish a voting trust agreement, a proxy
agreement or a "special security agreement" approved by the Department of Defense and
designed to preclude the disclosure of classified information to the foreign owner or other
foreign interests.
1.1.3 Reporting Requirements for Foreign Direct Investment
All foreign investments in a U.S. business enterprise which result in a foreign person owning a
10% or more voting interest (or the equivalent) in that enterprise are required to be reported to
the Bureau of Economic Analysis, a part of the U.S. Department of Commerce. Pursuant to the
International Investment and Trade in Services Survey Act (22 U.S.C. §§ 3101-3108) and the
regulations promulgated thereunder (15 C.F.R. § 806), such reports must be made within 45
days after the investment transaction. Depending on the site of the entity involved, quarterly,
annual and quinquennial reports may be required thereafter.
1.1.4 The International Investment and Trade in Services Survey Act
The International Investment and Trade in Services Act ("IITSA" or the "Act"), passed in 1976,
authorizes the President to collect information and conduct surveys concerning the nature and
amount of international investment in the U.S. The IITSA's primary function is to provide the
federal government with the information necessary to formulate an informed national policy on
foreign investments in the U.S. It is not intended to regulate or dissuade foreign investment but
is merely a tool used to obtain the data necessary to analyze the impact of such investments
on U.S. interests.
Under the IITSA, international investments are divided into two classifications – direct investments
and portfolio investments. Congress has delegated its authority to collect information on
both types of international investments to the President. In turn, the President has delegated
the power to collect data on direct investments to the Bureau of Economic Analysis ("BEA"), a
part of the Department of Commerce, and on portfolio investments to the Department of the
A "foreign person" is any person who resides outside of the U.S. or is subject to the jurisdiction
of a country other than the U.S. A "direct investment" is defined as the ownership or control,
directly or indirectly, by one person of 10% or more of the voting interests in any incorporated
U.S. business enterprise or an equivalent interest in an unincorporated business enterprise.
Because the IITSA further defines "business enterprise" to include any ownership in real estate,
(with some exceptions) any foreign investor's direct or indirect ownership of U.S. real estate
constitutes a "direct investment" and falls within the requirement that reports be filed with the
Unless an exemption applies, a report on Form BE-13 must be filed with the BEA within 45
days of the date on which a direct investment is made. The form collects certain financial and
operating data about the investment, the identity of the acquiring entity and certain information
about the ultimate beneficial owner. In addition, a Form BE-14 must be filed by any U.S.
person assisting in a transaction which is reportable under Form BE-13. The purpose is,
obviously, to ensure that those required to file a Form BE-13 do so.
1.1.5 The Agricultural Foreign Investment Disclosure Act of 1978
The Agricultural Foreign Investment Disclosure Act ("AFlDA" or the "Act") of 1978 requires all
foreign individuals, corporations and other entities to report holdings, acquisitions and
dispositions of U.S. agricultural land occurring on or after February 1, 1979. The Act contains
no restrictions on foreign investment in U.S. agricultural land and is aimed only at gathering
reliable data from reports filed with the Secretary of Agriculture to determine the nature and
magnitude of this foreign investment. Unlike the reports filed under the International Investment
Security Act of 1976, reports filed under AFIDA are not confidential but are available for public
For the purposes of the Act, a "foreign person" is (i) any individual who is not a citizen or
national of the U.S. and who is not lawfully admitted to the U.S.; (ii) a corporation or other legal
entity organized under the laws of a foreign country; and (iii) a corporation or other legal entity
organized in the U.S. in which a foreign entity, either directly or indirectly, holds 5% or more of
an interest. The definition of "agricultural land" is any land in the U.S. which is used for
agricultural, forestry or timber production. AFIDA requires a foreign person to submit a report on
Form ASCS-153 to the Secretary of Agriculture any time he holds, acquires or transfers any
interest, other than a security interest, in agricultural land. The report requires rather detailed
information concerning such matters as the identity and country of organization of the owning
entity, the nature of the interest held, the details of a purchase or transfer and the agricultural
purposes for which the foreign person intends to use the land. In addition, the Secretary of
Agriculture may require the identification of each foreign person holding more than a 5% interest
in the ownership entity.
1.1.6 Export Controls
In general, U.S. export controls are more stringent and restrict a wider array of items than the
export controls of most other countries. (See the Export Administration Act of 1979, as
amended, 50 U.S.C. App. §§ 2401-2420 and the regulations promulgated thereunder, 15
C.F.R. §§ 730-799.) Except for exports to U.S. territories and possessions, and in most
cases, Canada, all exports from the U.S. should undergo a review to determine if they are
subject to an export "license." An export license is an authorization which allows the export of
particular goods, commodities, or technical information, software, or defense articles.
Depending on the article in question, export authority from the U.S. Department of Commerce
may be sought for dual-use items, or the Department of State, DDTC, for defense articles.
There are additional federal regulatory agencies with jurisdiction over exports that warrant further
review. Two basic types of licenses exist, general licenses and individual validated licenses or
specific licenses.
There are many types of general licenses. These are authorizations which are generally
available and for which it is not necessary to submit a formal application. They cover all exports
which are not subject to a validated license requirement. Most exports can be made under
one of these general classifications.
In contrast, individual validated licenses are required for those items for which the U.S.
specifically controls the export for reasons of national security, foreign policy or short supply. If
the export of a specific product to a specific destination is subject to an individual validated
license requirement, it is necessary to apply for and obtain such a license from the Office of
Export Administration (an office within the U.S. Department of Commerce) prior to the export.
Certain commodities cannot be exported to any country without an individual validated license,
while certain other commodities may require a validated license only for shipment to specified
countries. The export of items with military applications and high technology items are subject
to stringent regulation.
For purposes of the U.S. export control regulations, an export of technical information occurs
when the information is disclosed to a foreign national even if such disclosure occurs in the
U.S. Thus, if disclosure of information is subject to a validated license requirement, the
disclosure may not be made to a foreign national without first obtaining the necessary validated
license, whether or not the disclosure is to occur outside the U.S.
Additionally, the U.S. Department of Treasury, Office of Foreign Assets Control, maintain
sanctions programs for certain countries for all financial transactions.
Finally, with regards to the importation of goods, various U.S. federal agencies have
overlapping jurisdiction for the importation and entry into the U.S. market of products. The U.S.
Customs and Border Protection police U.S. borders and enforce laws of not only Customs
(classification, valuation, country of origin, and other priority trade programs), but also the Food
and Drug Administration, Environmental Protection Agency, the Consumer Product Safety
Commission, and many other federal agencies have jurisdiction to regulate and approve or
license the importation and entry into market over several products.
1.1.7 Foreign Trade Zones
Foreign trade zones are areas in or adjacent to ports of entry which are treated as outside the
customs territory of the U.S. In order to expedite and encourage trade, goods admitted into a
foreign trade zone are generally not subject to the customs laws of the U.S. until the goods are
ready to be imported into the U.S. or exported. These foreign trade zones are isolated,
enclosed and policed areas which contain facilities for the handling, storing, manufacturing,
exhibiting and reshipment of merchandise. Foreign trade zones are created pursuant to the
Foreign Trade Zones Act (19 U.S.C. §§ 81a-u) and are operated as public utilities under the
supervision of the Foreign Trade Zones Board. Under the Foreign Trade Zones Act, the Board
is authorized to grant to public or private corporations the privilege of establishing a zone.
Regulations covering the establishment and operation of foreign trade zones are issued by the
Foreign Trade Zones Board, while U.S. Customs Service regulations cover the customs
requirements applicable to the entry of goods into and the removal of goods from these zones.
1.1.8 Anti-Dumping Law
The U.S. anti-dumping law (19 U.S.C. §§ 1671-1677) provides that if a foreign manufacturer
sells goods in the U.S. at less than fair value and such sales cause or threaten material injury to
a U.S. industry, or materially retard the establishment of a U.S. industry, an additional duty in an
amount equal to the "dumping margin" is to be imposed upon the imports of that product from
the foreign country where such goods originated. Under the statute, sales are deemed to be
made at less than fair value if they are sold at a price which is less than their "foreign market
value" (which generally is equivalent to the amount charged for the goods in the home market).
The dumping margin is equal to the amount by which the foreign market value exceeds the
U.S. price.
The Secretary of Commerce is charged with determining whether merchandise is being sold at
less than fair value in the U.S. The International Trade Commission makes the determination of
whether such sales cause or threaten material injury to a U.S. industry.
1.2 Federal Antitrust Laws
The antitrust laws of the United States are primarily reflected in five federal statutes: the Sherman Act,
the Clayton Act, the Robinson-Patman Act, the Federal Trade Commission Act, and the Hart-Scott-
Rodino Act.
1.2.1 The Sherman Antitrust Act of 1890
The Sherman Act is divided into two primary sections. Section 1 prohibits contracts,
combinations, and conspiracies made in restraint of trade. Section 2 prohibits unilateral and
combined conduct that monopolizes or attempts to monopolize trade. Under the Sherman Act,
some restraints are "per se" unreasonable (such as price-fixing agreements between competitors)
and others are subject to analysis under a "rule of reason" (such as some restrictions
placed on a distributor by a manufacturer). Restraints subject to the "per se" rule are never
permitted, while those governed by the "rule of reason" test will be evaluated on a case-bycase
1.2.2 The Clayton Act of 1914
The Clayton Act prohibits certain specific anticompetitive activities. For example, the Act
prohibits some corporate mergers, exclusive dealing contracts, and agreements under which
one product is sold subject to the requirement that the purchaser also buy another product
from the seller (known as a "tying" arrangement).
1.2.3 The Robinson-Patman Act of 1936
The Robinson-Patman Act prohibits a seller from discriminating (or inducing others to
discriminate) among competing purchasers in the price charged for commodities "of like grade
and quality." While the Act focuses on price discrimination, it also addresses other concerns
such as discriminatory advertising allowances.
1.2.4 The Federal Trade Commission Act
The FTC Act declares unlawful "unfair methods of competition" and "unfair or deceptive acts or
1.2.5 The Hart-Scott-Rodino Antitrust Improvements Act of 1976
The Hart-Scott-Rodino Act requires that, under certain circumstances, a company proposing to
merge with or acquire another company must give prior notice of the proposed acquisition to
the Federal Trade Commission and the Justice Department. Failure to report may result in very
substantial fines.
1.2.6 Enforcement
Private individuals and corporations may bring lawsuits under the Sherman Act, the Clayton Act
and the Robinson-Patman Act. Remedies may include injunctive relief, treble damages and
attorney fees. The government may enforce the Sherman Act through criminal prosecutions
and civil suits. In addition, the government may enforce the Clayton Act and the Robinson-
Patman Act through the FTC or the Justice Department. Only the government can enforce the
Federal Trade Commission Act and the Hart-Scott-Rodino Act.
1.3 Florida Antitrust Laws
Florida's antitrust statutes are located in Chapter 542, Florida Statutes, "Combinations
Restricting Trade or Commerce," and are expressly intended "to complement the body of
federal law prohibiting restraints of trade or commerce[.]" Accordingly, federal applications and
interpretations of U.S. antitrust laws are directly applicable to Florida antitrust law, and such
litigation in Florida often has Florida statutory claims proceeding parallel to federal statutory
claims under the same analysis; however, prosecution of an antitrust violation by the Florida
Attorney General is prohibited while there is a federal prosecution pending. Florida's statutes
provide for civil penalties (of up to $100,000 against individuals and $1,000,000 against
companies) and injunctive relief in actions brought by the Florida Attorney General. Private
individuals are authorized to seek injunctive relief and treble damages, plus attorneys' fees and
costs. Suit on an antitrust violation must be brought within four years of accrual of the claim,
except that the statute of limitations on a private suit is tolled until one year after the conclusion
of a proceeding brought by the Florida Attorney General.
Chapter 542 expressly deems written contracts barring an individual from competing after
selling a business not to be illegal restraints of trade, within certain parameters, and authorizes
injunctive relief as well as damages. Similarly, written contracts through which an employee
agrees not to compete with an employer during employment or post-employment are
approved, subject to reasonableness of time, area, and line of business covered.
For further discussion on restraints of competitive activities in an employment-agreement
context, see also Section 6.3.5 of this Guide [Florida Non-Compete Statute].
Business Regulations
Vit M. Gulbis, Esq. | (813) 209-5007 | firstname.lastname@example.com
Brian Goossen, Esq. | (813) 209-5010 | firstname.lastname@example.com
2.1 Requirements for Qualification to Do Business in Florida
Foreign corporations, limited liability companies, and limited partnerships (including limited liability limited
partnerships) must obtain a Certificate of Authority from the Florida Department of State, Division of
Corporations, before they may permissibly "transact business" in Florida.
The concept of "transact[ing] business" is not specifically defined in the Florida Statutes. However, a list
of activities that do not constitute transacting business (meaning, a list of activities for which foreign
qualification is not required) is provided in Florida Statutes §§ 607.1501, 608.501, and 620.1903.
Generally, activities that do not constitute transacting business in Florida include, but are not limited to:
(1) maintaining bank accounts; (2) selling through independent contractors; (3) soliciting or obtaining
orders, whether by mail or through employees, agents or otherwise, if the orders require acceptance
outside of Florida before they become contracts; (4) transacting business in interstate commerce; and
(5) conducting an isolated transaction that is completed within 30 days and not part of a series of
repeated similar transactions.
To obtain a Certificate of Authority, a foreign entity must file an Application by Foreign Corporation (or
Limited Liability Company or Limited Partnership, as the case may be) for Authorization to Transact
Business in Florida and must provide an original current certificate of existence, no more than ninety (90)
days old, duly authenticated by the Secretary of State or the proper official having custody of corporate
records in the state or country under the law of which the entity is organized or incorporated. If the
certificate of existence is in a language other than English, a translation of the certificate, under oath of
the translator, must be attached to the foreign-language certificate.
The laws of Florida require that each foreign entity applying for a Certificate of Authority must designate a
registered agent having a street address in the state. The registered agent must accept this designation
in writing and must indicate the agent's familiarity with the obligations of being a registered agent.
Registered agents are responsible for accepting service of process on behalf of the corporation, limited
liability company, or limited partnership. Failure to designate and properly file on behalf of its registered
agent will subject the foreign entity to a fine of up to $500.
A foreign entity's failure to obtain a Certificate of Authority will not invalidate any contracts, deeds,
mortgages, security interests or corporate acts, or prevent it from defending a legal proceeding in
Florida; however, such failure will prevent the entity from bringing an action in Florida, including defensive
counter-claims. If a Certificate of Authority is obtained after transacting business in Florida, the Division
of Corporations may collect all fees and taxes which would have been collected from the date the
certificate should first have been obtained. In some cases, the statutes also direct the Division of
Corporations to impose fines between $500 and $1,000 for each year or portion in which the foreign
entity transacts business without a Certificate of Authority.
Foreign general partnerships (just as domestic general partnerships) are not required to take any specific
action in order to transact business. However, if a foreign general partnership wishes to take advantage
of the benefits afforded a Florida "registered" general partnership, it must file a partnership registration
statement with the Division of Corporations. Similarly, if a foreign limited liability partnership wishes to
maintain its limited liability status in Florida, it must register and file a statement of foreign qualification.
Partnership registration requires a listing of all partners and their mailing addresses or the listing of an
agent who maintains the partner information. Qualification as a foreign limited liability partnership also
requires the designation of a registered agent.
Florida Statutes provide a method for certain unincorporated foreign associations to qualify to transact
business in Florida. The organizations to which this provision applies are any unincorporated joint stock
associations for profit that are engaged in any business or businesses other than the banking, trust, or
insurance business, and which have written articles of association, capital stock divided into shares,
and a name including the word "company" or "association" or "society."
2.2 Florida Business Organizational and Regulatory Requirements,
Corporations, limited liability companies, limited partnerships, and limited liability partnerships in Florida
are required to file certain organizational documents with the Division of Corporations, and general
partnerships may elect to do so as well. Sample forms and a fee schedule are available on the Division
of Corporation's website at http://www.sunbiz.org. Organizational documents like Articles of
Incorporation, Articles of Organization, and Certificates of Limited Partnership, may be filed online at
http://www.sunbiz.org. Please note that general partnership registrations and qualifications as a limited
liability partnership may not be filed online. There is additional guidance in the applicable Florida
Statutes, as well as forms and instructions on the Division of Corporation's website, for the amendment
and correction of organizational documents, the reinstatement of an administratively dissolved entity, the
domestication or conversion of a foreign entity, and related matters.
Once a business has filed its organizational documents with the Division of Corporations, there may be
other specific requirements that must be met depending on the type of business involved. It may also
be necessary for the entity or its principals or both to register or become licensed with one or more state
regulatory boards. Registration or licensing applies to many types of businesses and professions
operating in Florida, especially those engaged in providing legal, healthcare, financial and other
professional services to the public. Before operating any business in Florida, it is advisable to review the
Florida Statutes for restrictions that may apply on the entity and its principals and to communicate with
the applicable licensing boards and state departments which impose or enforce restrictions and
obligations affecting persons engaged in such businesses or professions in Florida.
A detailed description of each specific business or profession is beyond the scope of this Guide. A
listing of the regulated businesses in Florida is available at http://www.stateofflorida.com (not an official
State of Florida website, but a good starting point).
It is important to remember that a business may also be subject to occupational license requirements for
both the county and the municipality in which the business is located. Information about these licenses
is typically found on the respective county's or city's website.
2.3 Business Name Registration Requirements
2.3.1 Naming Requirements for Business Entities
The Florida Statutes impose restrictions on the naming of various business entities. For
example, the name of a corporation must contain the word "corporation," "company," or
"incorporated" or the abbreviation "Corp.," "Inc.," or "Co." A limited liability company name must
contain the words "limited liability company," the abbreviation "L.L.C.," or the designation "LLC"
as the last words of the name. There are similar naming requirements for limited partnerships,
limited liability limited partnerships and limited liability partnerships. Entities owned by licensed
professionals which perform professional services for the public are subject to other naming
Each business entity name must be distinguishable from the names of all other entities
organized or registered in Florida and on file with the Division of Corporations, with the
exception of fictitious names as noted below. The current list of active and inactive business
entity names may be searched by selecting the "Look up a Business Name" option on The
Division of Corporation's website at http://www.sunbiz.org. Geographical qualifiers are
generally not acceptable to make a name distinguishable. For example, XYZ of Florida, Inc.
would not be considered distinguishable from XYZ, Inc.
A foreign entity desiring to do business in Florida must meet these naming requirements by
adding the proper designation to the entity's name, or by operating under a different name if the
entity's name is not available.
2.3.2 Fictitious Names
Florida Statutes § 865.09 is known as the Fictitious Name Act and imposes requirements on
any person or entity that transacts business under any name other than such person's legal
name or the properly registered business entity name with the Florida Division of Corporations.
The purpose of registering fictitious names is to give public notice as to ownership of the name.
Registering the fictitious name does not grant the owner any trademark or service mark or other
protection of the name against use by another party. In fact, duplicate identical fictitious names
may be registered. A person registering a fictitious name must ensure that the name being
registered does not violate another person's protected trade mark or service mark.
Persons or entities applying to register a fictitious name must first advertise the name at least
once in a newspaper in the county where the principal place of business of the applicant will be
Fictitious name registrations are valid for five years and expire on December 31 of the fifth year.
Renewals may be filed at any time during the fifth year. Registrations and renewals of fictitious
trade names can be done online at http://www.sunbiz.org. An expired fictitious name cannot
be reinstated. Upon the expiration of a fictitious name, a new application for fictitious name
must be filed, including re-publishing the notice in the newspaper to comply with the
publication requirement.
The business and its owners that use an unregistered fictitious name may not maintain any
action, suit, or proceeding in any court of this state until the fictitious name has been properly
registered and may be guilty of a misdemeanor. Contracts made by the business are
enforceable against it.
There are three exemptions from the fictitious name registration requirement:
• Attorneys licensed to practice in Florida forming a business for the practice of law
in Florida;
• Applicants who are registered or licensed with the Florida Department of Business
and Professional Regulation or with the Florida Department of Health (although
some licensing boards require fictitious name registrations); or
• Applicants who are corporations, partnerships or other commercial entities that are
actively organized or registered with the Division of Corporations and are not
transacting business under any other name.
2.4 Notice of Business Activities
In addition to filing organizational documents (such as Articles of Incorporation, Articles of Organization,
Certificate of Limited Partnership, or a Partnership Registration and Statement of Qualification for a
limited liability partnership) with the Division of Corporations, businesses must file an annual report with
the Division of Corporations, and provide notice of the business's termination of its legal existence or
withdrawal from Florida.
2.4.1 Annual Reports
Corporations, limited liability corporations, limited partnerships and limited liability partnerships
must file annual reports between January 1 and May 1 each year. The annual reports must be
filed with the Division of Corporations, and can be e-filed at http://www.sunbiz.org. In addition
to the standard filing fees specified on http://www.sunbiz.org, there is a $400 late fee for
annual reports filed after May 1st. The Division of Corporations takes the position that it lacks
authority to abate the late fee. If a business entity fails to file its annual report by the close of
business on the third Friday of September, it will be administratively dissolved in the following
week, and must file for reinstatement. In the case of a limited liability partnership, failure to file
the annual report will result in revocation of its statement of qualification as a limited liability
partnership. The Division of Corporations will send an email to the business to remind it to file
its annual report, but failure to receive this notice will not excuse the entity from paying the late
fee if the annual report is filed late.
Any changes in an entity's registered agent, officers, directors, managers, the principal office
and mailing address, and other information (but not the entity's name) occurring after the
entity's formation or after a an annual report has been filed can and should be updated when
the next annual report is filed. In some cases, an amended annual report can be filed to
update such information in the event of additional changes after an annual report is filed.
2.4.2 Termination of Legal Existence
A business that wishes to dissolve can file Articles of Dissolution (or, in the case of a registered
partnership, a Statement of Dissolution) with the Division of Corporations in accordance with
Florida Statutes §§ 607.1403 (corporations), 608.441 (limited liability companies) or 620.1801
(limited partnerships). Dissolved entities may make provisions to dispose of known and
unknown or contingent claims by following procedures set forth in the Florida Statutes
§§ 607.1406, 1407 (corporations), 608.4421, 444 (limited liability companies) or 620.1806,
1807 (limited partnerships). The specific requirements, including written notice to all known
and potential claimants, are discussed in the statutes. Managers, officers and directors of a
dissolved corporation or limited liability company who follow these procedures are not exposed
to personal liability to creditors of the dissolved business.
2.4.3 Withdrawal from the State
A foreign corporation, limited liability company or limited partnership that wishes to cease
operating in Florida must obtain a certificate of withdrawal or file a notice of cancellation with the
Division of Corporations in accordance with Florida Statutes §§ 607.1520 (corporations),
608.511 (limited liability companies) or 620.1907 (limited partnerships). Corporations and
limited liability companies must provide a mailing address and must commit to notify the
Division of Corporations if the mailing address changes in the future. The Department of State
will be designated as the entity's agent for service of process within the state, and will mail a
copy of the process to the foreign corporation or limited liability company at the mailing address
provided by the entity.
2.5 Applicability of Florida State Usury Laws
Florida Statutes chapter 687 deals with usury laws. In general, for loans of $500,000 or less, the
interest rate cannot exceed 18% simple interest per year. For loans of greater than $500,000, the
interest rate cannot exceed 25% simple interest per year. Florida Statutes § 687.04 provides that if a
loan is usurious, then the lender may not recover any interest whatsoever, and only the principal sum of
the loan contract may be enforced. If the usurious interest has already been paid to the lender, then the
borrower may recover double the amount of interest paid. The lender can cure a usurious loan if the
lender notifies the borrower in writing and refunds the excess interest prior to the time that the borrower
asserts usury as a defense or commences a proceeding to recover usurious interest. Florida Statutes §
The usury limitations apply to payments, however denominated, which constitute charges for the use of
money, such as interest or finance charges. However, late charges on installment payments imposed
by lessors and those regularly in the business of lending money are not included in the calculation of
interest for determining whether a transaction is usurious if the late charge is not in excess of 5% of the
delinquent installment and only one late charge is collected on any installment, regardless of the period
in which it remains in default. Florida Statutes § 687.03(2)(c). Similarly, charges for attorney's fees in an
enforcement action are not considered interest. Florida Statutes § 687.05.
If the principal amount of the loan exceeds $500,000, then any property given to the lender, the value of
which depends on the success of the venture in which the loan proceeds are used, is not considered
interest. Stock options and interests in profits, receipts or residual values are examples of this exception
to the usury laws and are excluded from the calculation of interest. Florida Statutes § 687.03(4).
Penalties for criminal usury are covered in Florida Statutes § 687.071. The severity of the penalty
increases with the rate of interest charged. If a loan constitutes criminal usury, the debt is
unenforceable. Florida Statutes § 687.071(7).
Corporations, LLCs and Partnership Entities
Philip B. Schwartz, Esq. | (954) 468-2455 | firstname.lastname@example.com
Andrew E. Schwartz, Esq. | (954) 468-2452 | email@example.com
Alia R. Luria, Esq. | (407) 419-8599 | email@example.com
Sole Proprietorships and Joint Ventures
James F. Goldsmith, Esq. | (407) 419-8508 | firstname.lastname@example.com
Not for Profit Entities
Vit M. Gulbis, Esq. | (813) 209-5007 | email@example.com
Brian Goossen, Esq. | (813) 209-5010 | firstname.lastname@example.com
Florida B- and SP-Corporations
Philip B. Schwartz, Esq. | (954) 468-2455 | firstname.lastname@example.com
Andrew E. Schwartz, Esq. | (954) 468-2452 | email@example.com
3.1 Florida Corporations
3.1.1 Introduction
The corporate form remains a popular form of entity to conduct business principally due to the
protection it provides its shareholders from liability for obligations of the business. Under the
laws of Florida, a corporation can be organized for any lawful purpose, except where a conflict
arises with regulations or statutes that control specific types of businesses, such as
Professional Corporations. For the purposes of Florida law, a corporation is considered a
separate legal entity or "person." This separate status ensures that, absent certain
circumstances, the shareholders of the corporation are not responsible for repaying the debts
and obligations of the corporation from their personal assets.
The Florida Business Corporation Act governs the formation, operation and dissolution of
corporations in the State of Florida, and general supervision is provided by the Department of
State, Division of Corporations, P.O. Box 6327, Tallahassee, Florida 32314,
3.1.2 Formation
One or more persons may act as the incorporator or incorporators of a Florida corporation by
filing Articles of Incorporation with the Department of State, Division of Corporations. Florida law
provides that the Articles must be executed by a director, president or other officer, but an
incorporator or fiduciary can file the formation documents if such directors or officers have not
yet been chosen. There is no requirement that the incorporator be a citizen or resident of
Florida. The filing documents must be type-written, in English, executed by the incorporator and
a registered agent, and delivered to the Department of State with a filing fee of $35.00. Forms
and instructions specific to each type of Florida entity are available on the Division of
Corporations website. A corporation exists and is effective as of the date and time of its filing,
but the incorporator may indicate a delayed effective date and time. In such case, the
corporation will become effective on the specified date and time.
The Articles of Incorporation must contain the following information:
a. Name of the Corporation. The name of the corporation must include in it a
word such as "Corporation," "Company," "Incorporated," or some abbreviation
thereof, such as will clearly indicate that it is a corporation. A Professional
Association must contain the words "Chartered" or "Professional Association".
The name may not imply that the corporation is organized for a purpose other
than that of a corporation, may not imply that it is connected to a government
agency, and must be distinguishable from other entities or filings registered
with the Division of Corporations;
b. Incorporators. The name and address of each incorporator;
c. Registered Agent and Office. The street address of the corporation's initial
registered office and the name of its initial registered agent at that office,
together with written acceptance stating that the registered agent is familiar
with, and accepts, the obligations of the position;
d. Street and Mailing Addresses. The street address and, if different from the
street address, the mailing address of the initial principal office of the
e. Number of Authorized Shares. The number of shares the corporation is
authorized to issue; and
f. Describe Preemptive Rights. If any preemptive rights are to be granted to
shareholders, the provision for such rights must be set forth in the Articles of
The Articles of Incorporation may also optionally contain the following information:
a. Initial Directors. The name and addresses of the individuals who shall serve
as the initial directors;
b. Purpose. The purpose or purposes for which the corporation is organized,
provided such purpose is not inconsistent with the law;
c. Par Value. A par value for authorized shares or classes of shares;
d. Powers. Provided that it is not inconsistent with Florida law, a provision
defining, limiting, and regulating the powers of the corporation and its board of
directors and shareholders;
e. Personal Liability. Provided that it is not inconsistent with Florida law, a
provision setting forth the imposition of personal liability on shareholders for
the debts of the corporation to a specified extent and upon specified
f. Management. A provision describing the management of the business and
regulating the affairs of the corporation; and
g. Other. Any further provisions that are required or permitted to be set forth in
the Bylaws of the corporation.
If the Articles of Incorporation are determined by the Department of State to be incomplete and
inappropriate for filing, the Department of State may return the document filed to the person
filing it with a written explanation of its deficiency. The applicant can then file the document
again within 60 days and request the same initial filing date, and, if the document is approved,
it will be effective as of that original date.
A corporation may correct a document filed with the Department of State within 30 days after
filing the document if it contains an inaccuracy, was defectively executed, or was defectively
transmitted. To correct the filing, Articles of Correction must be prepared that describe the
document and its original filing date, specify the inaccuracy that needs to be corrected, correct
the accuracy, and deliver the Articles of Correction to the Department of State. Articles of
Correction are effective as of the filing date of the original document.
3.1.3 Organization
Articles of Incorporation provide the fundamental rules and structure that govern the
corporation's existence. However, Articles of Incorporation will often not provide the level of
detail required to organize and manage the routine day-to-day existence of a corporation. More
detail is set forth in the corporation's Bylaws, which, unlike the Articles of Incorporation, are not
filed with the Department of State and are therefore not public record. Initial Bylaws of the
corporation may be adopted by its incorporators or by the initial board of directors. In general,
Bylaws of a corporation contain provisions determining the number of officers and directors, as
well as their powers and duties; the time and manner of holding shareholder meetings and
board meetings; voting rights and procedures; filling of vacancies on the board or among
officers; indemnification provisions pertaining to directors and officers; fiscal year audits and
financial reporting; and other miscellaneous organizational matters such as amendment
Corporations are organized around a hierarchical control structure which is managed by or
under the direction of the board of directors and its officers. Shareholders will be called upon to
vote on important corporate issues, such as electing directors, approving mergers, selling of all
the corporation's assets or dissolving the corporation itself. As part of the organization of the
corporation, the initial board of directors will meet in person or through a written consent and
ratify the acts taken in connection with the initial formation of the corporation and to further
adopt the written Bylaws.
3.1.4 Capitalization
A corporation has many options for raising its initial capital; these options include various kinds
of equity (such as common stock, preferred stock, options, or warrants) and numerous types
of debt instruments (such as convertible notes, subordinated notes, bonds, or commercial
If a corporation (or any other form of business organization) elects to raise capital through the
sale of its securities to investors, it should be aware that the issuance of securities to investors
is regulated both by United States law and by state law, and care must be taken by the
corporation to avoid violation of the complex provisions of these laws. Users of this Guide are
advised to refer to Chapter 4 [Securities Regulation] and to seek the advice of an attorney wellversed
in the various state and federal securities laws to ensure compliance with all applicable
3.1.5 Issuance of Shares
The corporation can only sell shares that are authorized to be issued. The Articles of
Incorporation will set forth the number of shares that the corporation is authorized to issue, but
the corporation will likely authorize the issuance of shares through the board of directors
(although that right may be reserved to the shareholders by the Articles of Incorporation).
Shares may be issued for consideration consisting of any tangible or intangible property or
benefit to the corporation, including cash, promissory notes, services performed, promises to
perform services evidenced in writing, or other securities of the corporation. The board of
directors has the discretion to determine whether the consideration is adequate, but it must
make such determination for the shares to be considered validly issued, fully paid and nonassessable.
It is not required under Florida law that shares of corporations be evidenced by certificates, but
if such certificates exist, they must be signed by officers designated in the Bylaws or by the
board of directors.
Restriction on the transfer of shares can be placed on the shares through the Articles of
Incorporation, the Bylaws, or shareholder agreements. A restriction in place at the time the
shares are issued is valid and enforceable against the holder or a transferee of the holder if the
restriction is authorized by the Florida Business Corporation Act and its existence is
conspicuously noted on the front or back of the certificate.
Under Florida law, shareholders do not have preemptive rights to acquire a pro rata share of
newly issued shares unless that right is specifically granted in the Articles of Incorporation.
Thus, the board of directors may issue additional authorized but un-issued shares free of any
claims of existing shareholders.
3.1.6 Management
A corporation is managed by one or more directors, who need not be residents of Florida or
shareholders of the corporation (unless otherwise stated in the Articles of Incorporation).
Closely held corporations with fewer than 100 shareholders may dispense with or limit the
authority of the board of directors through an agreement amongst the shareholders. If a
corporation has directors, they will be elected by the shareholders at an annual meeting. Florida
law limits the division of directors into groups of not more than three equal classes, whose
terms of office expire in a staggered manner.
Unless prohibited by the Articles of Incorporation, the board of directors of a corporation may
designate an executive committee from among its members. An executive committee has the
right to exercise all of the authority of the board of directors except the authority to approve or
recommend to shareholders actions required to be approved by shareholders; fill board
vacancies; adopt, amend or repeal the Bylaws; reacquire corporate shares; and issue or
contract for the sale of shares.
The daily affairs of the corporation are supervised by its officers. A corporation must have
officers described in its Bylaws or appointed by the board of directors. Two or more offices
may be held by the same individual. Officers serve at the pleasure of the board of directors and
may be removed from office at any time, with or without cause.
3.1.7 Liability of Directors
A director will have no liability to the corporation or its shareholders if the director discharges his
or her duties in good faith and in a manner that the director reasonably believes to be in the
best interest of the corporation and with that degree of diligence, care and skill which an
ordinarily prudent person would exercise under similar circumstances if serving in a like
position. Florida law further substantially restricts the grounds for asserting personal liability
against a director. Under Florida law, a director is not personally liable for monetary damages to
the corporation or its shareholders or third parties unless, among other things, the director's
breach or failure to perform his or her duties as director constitutes a violation of the criminal
law, a transaction for which the director derived an improper personal benefit, or an unlawful
Additionally, Florida law permits a corporation to indemnify a director who may be party to any
third party action if the director acted in good faith and in a manner reasonably believed not to
be opposed to the best interest of the corporation. Indemnification may not be available in a
derivative action if the director is found liable, unless a court determines that the director is fairly
entitled to such indemnification. Under Florida law, any determination of indemnification must
be made in keeping with the statutory requirements and standards by a majority vote of a
quorum of disinterested directors, by independent legal counsel, or by a majority of
disinterested shareholders.
3.1.8 Actions by Directors and Shareholders
Directors may act at a meeting of the board or through written consents. Meetings may be
regular or special and may be held in or outside of Florida. Notice requirements for special
meetings shall be at least two days prior to the meeting unless otherwise stated in the Bylaws.
Directors do not have to attend meetings in person and may be present via some form of
distance communication, as long as all the directors present can hear each other
Unless otherwise provided in the Articles of Incorporation or Bylaws, a majority vote of the
directors at a meeting where a quorum is present constitutes an action by the board. Unless
the Articles or Bylaws provide otherwise, a majority of the directors then in office constitutes a
quorum. The Articles or Bylaws may change the number of directors required for a quorum, but
in no event may a quorum consist of less than one third of the currently serving directors.
Directors may also act without a meeting by unanimous written consent.
The corporation must hold an annual meeting at which shareholders elect directors. Unless
otherwise provided in the Articles of Incorporation, action may be taken by the shareholders
without a meeting, notice or vote, if consent in writing setting forth the action taken is signed by
the minimum number of votes necessary to authorize such action at a meeting. Notice stating
the place, day and hour of the meeting (and in the case of a special meeting, the purpose for
such meeting) must be given to shareholders with a right to vote not less than ten but not more
than 60 days before the meeting. The board of directors may authorize shareholders and proxy
holders to participate in meetings by means of remote communication. If the corporation has
not held an annual meeting for a thirteen-month period, or if the corporation has failed to hold a
special meeting properly demanded by a shareholder pursuant to Florida Statutes, then any
shareholder entitled to vote in an annual meeting may apply to the circuit court to order a
meeting to be held.
Notice to shareholders must be in writing unless oral notice is expressly authorized by the
Articles of Incorporation or the Bylaws and such notice is provided under reasonable
circumstances, and may be communicated by telephone, voicemail, or other electronic means,
or by mail or other method of delivery. Notice by electronic transmission is considered written
notice. Written notice to shareholders is effective upon deposit into the U.S. mail, if mailed
postpaid and correctly addressed to a shareholder's address or when electronically transmitted
to a shareholder in a manner authorized by the shareholder, and notice to such corporation
may be addressed to its registered agent at its registered office, to its electronic mail address
as authorized, or to its secretary at its principal office. Multiple shareholders who reside at one
address must give consent to receive a combined notice, but a shareholder who fails to object
in writing within 60 days of written notice of the corporation's intent to use single notice is
deemed to have consented.
Unless the Articles of Incorporation provide otherwise, voting for directors is not cumulative and
each shareholder is entitled to one vote for each share standing in his or her or its name on the
books. The majority of shares outstanding constitutes a quorum unless the Articles of
Incorporation specify otherwise. Shareholders may vote by a proxy that they appoint by written
instrument or by electronic transmission, and a proxy is valid for eleven months unless
otherwise provided in the proxy itself. Shareholders of the corporation may appoint a proxy by
signing an appointment form or transmitting or authorizing an electronic transmission, which
proxy is usually revocable except in certain circumstances.
Florida has adopted a control-share acquisition statute based on a similar law upheld by the
U.S. Supreme Court in Corp. v. Dynamics Corp. of Am., 481 U.S. 69 (1987). The statute
limits the ability of a person or group of persons to vote the stock of a corporation if such
person or group of persons has voting power to elect directors of the corporation and the
person or group of persons control at least one-fifth of the corporation's stock. The Articles of
Incorporation or Bylaws of the corporation can exclude the corporation and its shareholders
from the statute's application. Additionally, the statute contains several other exceptions to its
Additionally, voting trusts are permitted under Florida law and may be created when
shareholders enter into a written trust agreement, deposit a copy with the corporation, and
transfer the shares to the trustee. Two or more shareholders may also provide for the manner in
which they will vote their shares by signing a voting agreement. A transferee shareholder of
shares covered by the voting agreement is bound by the agreement if the transferee takes
shares subject to such agreement with notice thereof. Affiliate transactions are prohibited in
certain situations, unless the requirements of the Florida statutes are complied with. Affiliate
parties may be prohibited in certain situations from obtaining stock by sale, lease, exchange,
mortgage, pledge or other disposition, but a corporation may opt out of this provision of the
3.1.9 Distributions to Shareholders
The board of directors may authorize and the corporation may make distributions to its
shareholders, subject to the restrictions in the Articles of Incorporation, unless the corporation
would not be able to pay its debts as they become due in its usual course of business or the
corporation's total assets would be less than the sum of its total liabilities plus (unless the
Articles of Incorporation permit otherwise) any amounts needed to satisfy the preferential rights
upon dissolution of any shareholders whose preferential rights are superior to those receiving
the distribution.
Except for corporations that make an election under Subchapter S of the Internal Revenue
Code, a corporation is taxed on any earnings before they are passed down to shareholders.
Once received by the shareholders, these distributions are then taxed at the shareholder's
applicable individual tax rate. Thus, the corporation is subject to what is called "double
3.1.10 Liability of Shareholders
Shareholders of a corporation generally enjoy protection from personal liability for the obligations
of the corporation. Shareholders are under no obligation to the corporation or its creditors to
pay for shares, other than the obligation to pay the corporation any unpaid portion of
consideration for which the shares were originally issued to the shareholder.
Under certain circumstances, usually extraordinary in nature, a court of equity may "pierce the
veil" of a corporation to impose personal liability upon shareholders for the corporation's
obligations. Among the factors that might lead a court to pierce the veil are the shareholder's
failure to observe corporate formalities, such as keeping corporate records, electing directors
and officers, holding meetings, and commingling corporate and non-corporate funds and
assets. It is important to observe these formalities of corporate existence, even though the
instances of veil piercing by the courts are unusual.
3.1.11 Extraordinary Transactions
Certain extraordinary transactions involving corporations, including mergers, share exchanges,
conversion to a different form of business organization, sale of all or substantially all assets out
of the ordinary course of business, and voluntary dissolution, require, in addition to board of
director approval, approval of the corporation's shareholders. In addition, shareholders who
object to such transactions and who do not vote in favor of them may, under certain
circumstances, elect to dissent from the transaction and, by following detailed procedures set
forth in the Florida Business Corporation Act, demand to be paid the fair value of their shares,
as determined by an appraisal. Appraisal rights are not available for holders of any class of
shares which are either traded on a national securities exchange or for a class of shares which
has at least 2,000 shareholders or a market value of at least $10 million (excluding such value
held by subsidiaries, senior executives and directors, and beneficial shareholders owning more
than 10% of such shares) and in cases where the shareholders are required to accept any
consideration other than cash for their shares.
3.1.12 Foreign Corporations
A corporation formed under the laws of another jurisdiction but which conducts business in
Florida is required to obtain a Certificate of Authority to transact business in Florida. To obtain a
Certificate of Authority, the corporation must file a certificate of existence issued from an
authorized officer of the jurisdiction of the corporation's formation evidencing said incorporation
and translated under oath if in a foreign language.
For the purposes of Florida law, the activities that do not constitute transacting business in
Florida include, but are not limited to: (1) maintaining bank accounts; (2) selling through
independent contractors; (3) soliciting or obtaining orders, whether by mail or through
employees, agents or otherwise, if the orders require acceptance outside of Florida before they
become contracts; (4) transacting business in interstate commerce; and (5) conducting an
isolated transaction that is completed within 30 days and not part of a series of repeated similar
Corporations that transact business without a Certificate of Authority are liable to the state for all
fees and taxes that would have been imposed by the state had the corporation duly qualified,
and any non-complying foreign corporations are liable to the state of Florida for a penalty of not
less than $500 but not more than $1,000 for each year or part of a year during which they
transact business. Additionally, corporations transacting business in Florida without a Certificate
of Authority may not maintain any action in Florida courts, including defensive counter-claims,
until such certificate is obtained. However, a failure to obtain a Certificate of Authority will in no
way impair the validity of an contract, deed, mortgage, security interest or act of the corporation
and does not prevent the corporation from defending itself in any proceeding in Florida.
The application for the Certificate of Authority must contain the following information:
a. Name. The name of the corporation;
b. Jurisdiction. The jurisdiction where the foreign corporation is incorporated;
c. Date. The date upon which the corporation was incorporated;
d. Duration. The duration of the corporation;
e. Addresses. The street address of the principal business office of the
corporation, as well as the address of the registered office in the state of
Florida and name of the resident agent;
f. Directors and Officers. The name and usual addresses of its current directors
and officers; and
g. Other. Any further provisions that are required by the Department of State.
The Certificate of Authority grants the authority to transact business in Florida and continues
until surrendered by the corporation, suspended by the state, or revoked. Further, the
corporation's name must comply with Florida naming conventions and it may have to register its
corporate name with additions, if any, required by Florida law, if its name is not distinguishable
from corporate names that are not available under Florida law. Registration is renewed annually
by a foreign corporation by filing an annual renewal application.
For more general information on regulation of foreign entities in Florida, see Chapter 2 of this
Guide [General Regulation of Business in Florida].
3.1.13 Filing and Recordkeeping
The Florida Business Corporation Act requires that each corporation keep the following
a. Articles in Effect. Its Articles or restated Articles of Incorporation and all
amendments to them currently in effect;
b. Bylaws in Effect. Its Bylaws or restated Bylaws and all amendments to them
currently in effect;
c. Resolutions Pertaining to Shares. Resolutions adopted by its board of
directors creating one or more classes or series of shares and fixing their
relative rights, preferences, and limitations, if shares issued pursuant to such
resolutions are outstanding;
d. Minutes and Shareholder Actions. The minutes of all shareholders' meetings
and records of all actions taken by shareholders without a meeting for the
past three years;
e. Shareholder Communications. Written communications to all shareholders
generally or all shareholders of a class or series within the past three years,
including the financial statements furnished for the past three years;
f. Directors and Officers. The names and business street addresses of its
current directors and officers; and
g. Annual Report. The most recent annual report delivered to the Department of
Florida law additionally requires that unless modified by resolution of the shareholders within
120 days of the close of the corporation's fiscal year, a corporation shall mail to its
shareholders an annual financial statement within 120 days after the end of the fiscal year.
The corporation is also required to file an annual report with the Florida Department of State
prior to May 1 of the subsequent calendar year. The annual report should be compiled on the
form available at the Department of State website, http://www.sunbiz.org, and only contains
basic corporate information and no financial information. For more information on filing annual
reports in Florida, see Chapter 2 of this Guide [General Regulation of Business in Florida].
3.1.14 Taxes and Subchapter S Corporations
Florida currently has a corporate income tax rate of 5.5%, and corporations must file a Form
F-1120 Corporate Income/Franchise and Emergency Excise Tax Return with the state. Unless
exempt, all corporations and artificial entities that conduct business or earn or receive income in
Florida, including foreign corporations, must file a Florida corporate income tax return. A
corporation will be required to pay all federal tax on the income it earns and its shareholders
must pay federal taxes on dividends distributed by the corporation, unless the corporation is an
S corporation.
For United States income tax purposes, corporations may be designated as either "C"
corporations or "S" corporations. An S corporation generally does not pay corporate income
tax, but its shareholders pay taxes on their pro rata share of the corporate earnings, regardless
of whether those earnings are distributed to the shareholders. To qualify as an S corporation,
the corporation must comply with strict IRS guidelines and complete the requisite election form
and must be approved by all shareholders.
For more information on taxation of business entities, see Chapter 5 of this Guide [Taxation].
3.2 Florida Limited Liability Companies
3.2.1 Introduction and Note about New LLC Law
An increasingly popular form of business entity is the limited liability company ("LLC"), which
combines some of the most favorable characteristics of both partnerships and corporations to
provide its principals with greater flexibility in structuring their company to achieve business and
tax objectives. Members of LLCs enjoy protection from direct claims of creditors of the LLC
analogous to a corporation, paired with the ability to be treated for tax purposes as a
disregarded entity and afforded the pass-through taxation option of a partnership. When an
LLC elects to be treated as a disregarded entity for tax purposes, income and expenses are
reported as though the members incurred them directly, and profits or losses are taxed at the
ownership (individual member) level rather than at the entity (company) level. Ownership of an
LLC is vested in members rather than shareholders, and members can be individuals, for-profit
organizations, or not-for-profit organizations.
Under the Florida Revised Limited Liability Company Act ("FRLLCA"), a limited liability company
can be organized for any lawful purpose but remains subject to the statutes and regulations of
the State of Florida for regulating businesses. For purposes of Florida law, a limited liability
company is considered a separate legal entity or "person." This separate status ensures that,
absent certain circumstances, the members of the limited liability company are not responsible
for repaying the debts and obligations of the company from their personal assets. The FRLLCA
governs the formation, operation and dissolution of limited liability companies in the State of
Florida, and general supervision is provided by the Department of State, Division of
Corporations, P.O. Box 6327, Tallahassee, Florida 32314, http://www.sunbiz.org.
3.2.2 Formation
One or more persons or entities may form a limited liability company by filing Articles of
Organization with the Department of State, Division of Corporations. Owners of an LLC are
referred to as "members," and an LLC with one member is a "single-member LLC" and is
afforded the same pass through tax treatment as an LLC with two or more members but
treated as a sole-proprietorship rather than a partnership. Articles of Organization must be filed
by one or more members or authorized representatives of the LLC. The current filing fee is
$125. Forms and instructions specific to each type of Florida entity are available at
http://www.sunbiz.org, and filing can be completed electronically.
An LLC exists and is effective at the time of the filing of the Articles of Organization, unless the
Certificate of Formation provides for a future effective date.
The Articles of Organization must contain the following information:
a. Name of the Limited Liability Company. The name of the LLC must include in
it the words "Limited Liability Company," the abbreviation "L.L.C." or the
designation "LLC" as the last words of the name of the LLC. The Division of
Corporations has interpreted this to prohibit the use of any other entity
designations, even if accompanied by a "LLC" reference (such as "XYZ LLC
Co."). The name may not imply that the LLC is organized for a purpose other
than that of an LLC, may not imply that it is connected to a government
agency, and must be distinguishable from other entities or filings registered
with the Division of Corporations, except that a limited liability company may
register under a name that is not otherwise distinguishable with the written
consent of the non-distinguishably named entity with written consent, if the
consent is filed with the Division of Corporations at the time of the name's
b. Principal Street Addresses. The street address of the principal office of the
LLC (which need not be in Florida); and
c. Mailing Addresses. If different from the principal office street address, the
mailing address of the LLC (which need not be in Florida); and
d. Initial Registered Agent and Registered Agent's Florida Address. The name
and street address of the LLC's initial registered agent for service of process
in the state of Florida. A third party agent may serve in this role for the LLC.
The Articles of Organization may also optionally contain the following information:
a. A declaration as to whether the limited liability company is member-managed
or manager-managed (if not designated, the limited liability company will be
presumed to be member-managed);
b. For a manager-managed limited liability company, the names and addresses
of one or more of the managers of the limited liability company;
c. For a member-managed limited liability company, the names and addresses
of one or more of the members of the company;
d. A description of the authority or limitation on the authority of a specific person
in the company or a person holding a position or having a specified status in
the company; and
e. Any other provisions not inconsistent with law.
The Articles of Organization must be executed by at least one member or the authorized
representative of a member.
Members or managers, as applicable, have an obligation to correct inaccurate information in
the Articles of Organization (whether such inaccuracy existed when the Articles of Organization
were filed or whether such inaccuracy is due to changed circumstances), and a failure to do so
may expose the member or manager, as applicable, to liability to third parties.
3.2.3 Management and Control: The LLC Operating Agreement
The management and control of the LLC is governed by the Florida Revised Limited Liability
Company Act ("FRLLCA"), to the extent that the LLC does not override the default provisions of
the act through the adoption of an Operating Agreement. It is in the best interest of an LLC to
adopt an Operating Agreement to govern the management of the LLC. The Operating
Agreement serves as a form of Bylaws and shareholder agreement for the LLC. In Florida,
members of an LLC may enter into an Operating Agreement, whether in writing or not, at any
time before or after the filing of the Articles of Organization, and the Operating Agreement takes
effect on the date of formation or the date specified in the Operating Agreement.
An LLC may be member-managed or manager-managed. In a member-managed LLC, unless
otherwise provided in the Articles of Organization or Operating Agreement, management shall
be vested in the members or elected managing members in proportion to the then-current
percentage or other interest of members in the profits of the LLC, and the decision of a
majority-in-interest of the members or elected managing members shall be controlling. In a
manager-managed LLC, unless otherwise provided in its Articles of Organization or Operating
Agreement, each manager has equal rights in the management and conduct of the LLC's
business, and any matter relating to the business of the LLC may be exclusively decided by the
manager or, if there is more than one manager, by a majority. A manager must be designated,
appointed, elected, removed or replaced by a vote, approval, or consent of the majority-ininterest
of the members; and will hold office until a successor has been elected and qualified,
unless said manager resigns or is removed.
The FRLLCA is a "default statute". That is, except for the non-waivable provisions set forth
above, to the extent that an Operating Agreement does not govern a particular matter, the
FRLLCA will be deemed to control.
The Operating Agreement may not:
a. Vary a limited liability company's capacity to sue or be sued in its own name.
b. Vary the applicable law (Florida law is always applicable to Florida limited
liability companies).
c. Vary the requirement, procedure, or other provision of the FRLLCA pertaining
1. Registered agents; or
2. The Department, including provisions pertaining to records authorized
or required to be delivered to the Department of State for filing under
the FRLLCA;
d. Vary the provisions of the FRLLCA relating to judicial orders.
e. Eliminate the duty of loyalty or the duty of care (except that it may alter where
not manifestly unreasonable or where willful or intentional misconduct are not
f. Eliminate the obligation of good faith or fair dealing.
g. Unreasonably restrict the right of members to information.
h. Vary the power of a person to dissociate.
i. Vary the grounds for dissolution.
j. Vary the requirements for winding up of an LLC's business, activities, or
k. Unreasonably restrict the right of a member to maintain an action against the
l. Prevent a court from appointing a special litigation committee.
m. Vary the right of a member to approve a merger, interest exchange, or
n. Vary the required contents of a plan of merger, interest exchange, conversion
or domestication.
o. Unreasonably restrict the rights of a third party.
p. Provide for indemnification for bad faith, willful misconduct, or a knowing
violation of law; from a transaction in which an indemnified member or
manager derived an improper personal benefit; for improper distributions; or
where there has been a breach of the duties of loyalty or care (except as may
be modified as set forth above).
An LLC is bound by the actions of each of its managers as agents of the LLC. Managers are
required to act in good faith and with the care an ordinary prudent person of similar
circumstances would use (the duty of care) and in conformity with what the manager perceives
to be in the best interest of the LLC (the duty of loyalty). These duties may not be eliminated or
unduly reduced by provisions in the Operating Agreement. If a manager acts in accordance
with these duties of care and loyalty, he or she will not be liable for acts or omissions made as
a manager of the LLC.
3.2.4 Statements of Authority and Denial
A Florida LLC may file a Statement of Authority or Statement of Denial with the Department of
State to notify third parties regarding the authority, or lack thereof, of a member or manager to
bind the LLC.
A Statement of Authority must include:
a. The name of the LLC as it appears in the records of the Department of State
and the street and mailing addresses of its principal office; and
b. The name and/or position reflecting the authority, or lack thereof, of all
persons having such status or holding such office to (i) execute an agreement
transferring real property held by the LLC or (ii) otherwise bind the LLC.
A statement of authority gives implied notice to a third party of a party's authority with regard to
binding the LLC. A Statement of Denial may be filed with the Department of State, denying
authority previously granted by the Statement of Authority.
3.2.5 Limited Liability of Members and Managers
The FRLLCA provides that a member or manager of an LLC is not liable for a debt or obligation
of the LLC and is not liable to the LLC or any other member or manager for such person's
good faith reliance on the provisions of the LLC's Articles of Organization or Operating
Agreement. This provision shields members to the extent that liability may exceed their
investment in the LLC and prevents them from being obligated to the LLC, other members,
managers, or creditors of the LLC for obligations not assumed through the member's capital
contribution or other investment.
3.2.6 Remedies of Member Creditors: The "Olmstead Patch"
Traditionally, Florida law followed the "pick your partner" principle in regards to LLCs, providing
that members of Florida LLCs had the right to determine their partners in business. Judgment
debtors of LLC members were limited to grants of charging orders, which gave such debtors
an assignment of the member's economic interest in the LLC while leaving the non-economic
powers in the hands of the debtor.
In Olmstead v. Federal Trade Commission, 40 So. 3d 76 (Fla. 2010), the Florida Supreme
Court ruled that Florida law permits a court to order a judgment debtor to surrender all right, title
and interest in a single-member LLC to satisfy an outstanding judgment interest against the
member of the single-member LLC. The Court determined that an interest in an LLC is a type
of "corporate entity" and was personal property, akin to corporate stock. This raised concern
that the judgment could apply to multi-member LLCs as well as single-member LLCs, and that
judgment debtors could foreclose upon all of a member's interest in a multi-member LLC,
violating the "pick your partner" principle in multi-member LLCs.
In response to the decision in Olmstead, an effort was led by the Florida Bar to propose a
"patch" to Florida's LLC Act to remove the uncertainty that was created. The patch, now
codified in § 605.0503 of the FRLLCA, provides that, with respect to multi-member LLCs in
Florida, a charging order is the "sole and exclusive remedy" by which a judgment creditor of a
member or an assignee of a member may satisfy a judgment from a judgment debtor's interest
in an LLC or rights to distributions from a member's interest in an LLC. The statute makes it
clear that foreclosure of a judgment debtor's interest in a multi-member LLC is not allowed.
With respect to single-member LLCs, while a charging order is expressed to be the sole and
exclusive remedy of a judgment creditor, if the judgment creditor can show that, under a
charging order, distributions will not satisfy the judgment in a reasonable period of time, the
court may order a foreclosure sale of the LLC interest, pursuant to which the purchaser in such
a sale becomes the member of the LLC and the judgment debtor's membership interest
3.2.7 Capitalization and Distributions
An LLC offers the same flexibility in raising capital as a for-profit corporation. Members may
contribute tangible property or services to the LLC, and such contributions may include
property, services, cash, or a promissory note or other obligation to contribute such property or
services in the future. A promissory note must be in writing and signed by the member
contributing the cash, property or services. Unless otherwise provided in the Articles of
Organization or Operating Agreement, if a member promises in writing to make a certain
contribution, the member is obligated to the LLC to perform that enforceable contribution
promise, even if the member is unable to perform because of the member's death, disability or
any other reason.
The LLC may make distributions to its members in accordance with its Operating Agreement
except that no distribution may be made that would render the LLC insolvent. Distributions are
generally made on an equal basis to each member based on each member's capital
contribution to the extent that such contributions have been received by the LLC. Therefore, if
the LLC wishes to make distributions in a manner other than pro rata based on each member's
capital contributions, it should address such intentions in its Operating Agreement.
3.2.8 Recordkeeping and State Reports
LLCs are required to file an annual report each year with the Department of State by May 1 of
the subsequent year. This annual report is filed on a prescribed form, and must contain the
following information: (1) the name and address of the LLC; (2) the names and addresses of
the managers or the managing members of the LLC; and (3) the name of the Florida registered
agent. No financial information is required to be filed with the Department of State. The current
annual filing fee for timely filed reports is $138.75, and there is a $400 penalty for the late filing
of reports. Annual reports can be filed electronically at http://www.sunbiz.org.
For more information on filing annual reports in Florida, see Chapter 2 of this Guide [General
Regulation of Business in Florida].
3.2.9 Taxation of LLCs
As discussed above, unless an LLC elects to be treated as a corporation for federal and state
tax purposes, it is generally not subject to entity-level taxation of its income under the federal
tax laws. However, LLCs are still required to file informational tax returns. Unless a member is
exempt from federal income taxation, its distributive share of membership income and loss is
treated as income or loss to the member and reported on his, her or its individual return,
regardless of whether a distribution of the income reported was ever made. Taxation of this
annual income will increase the member's basis in his, her or its share of the LLC, and when a
distribution is eventually made, it will not be taxed again on the receipt of the cash to the extent
that the member still has basis in the member's share of the LLC. There are many tax
implications to forming an LLC and business owners should consult an accountant or tax
attorney before proceeding with formation to fully understand how their tax liabilities and
reporting obligations may be impacted.
For more information on taxation of business entities, see Chapter 5 of this Guide [Taxation].
3.3 Florida Partnerships
3.3.1 Introduction
General partnerships, limited partnerships, limited liability partnerships, and limited liability limited
partnerships are several forms of unincorporated organization that Florida recognizes as
statutory entities under the laws of the State of Florida. Partnerships generally provide an
extremely flexible framework for government and management of a business operation. Profits
and losses in a partnership are allocated according to the terms of the Partnership Agreement,
but importantly, unlike LLCs, all of the assets of each partner in a general partnership are at risk
and may be made available to satisfy the obligations of the partnership, rather than just the
capital contributed to the entity.
To reduce potential liability exposure, limited partnerships ("LPs") were created and permit the
creation of a special class of partners known as "limited" partners. Limited partners provide
capital to the partnership but do not participate in its management. In a limited partnership, the
limited partners are only liable to the partnership to the extent of their capital contributions, but
the general partner does not have liability protection. The general partner manages the
business affairs of a limited partnership. Limited partnerships are frequently used as financing
vehicles where the investors will have no role in the management of the business and a simple
structure is needed to carry out the business of the partnership.
Limited liability partnerships ("LLPs") function like general partnerships but provide extra
protection for the general partners, such as personal immunity for partnership liabilities. A
partner's liability with respect to an LLP is usually limited to his or her investment in the
Limited liability limited partnerships ("LLLPs") function like limited partnerships but provide extra
protection for the general partner, similar to a limited liability partnership. This form of partnership
can be used to combine the effects of a limited partnership with a limited liability partnership.
3.3.2 General Partnerships
The Florida Revised Uniform Partnership Act ("FRUPA") governs the formation, operation and
dissolution of Florida general partnerships. A partnership is formed when there is an association
of two or more persons (a broadly defined term) to carry on as co-owners of a business with
the intention to make a profit, whether or not the persons intend to form a partnership.
a. Formation. No filings with the Department of State are required in order to
form a general partnership. However, a general partnership may optionally file
a Statement of Partnership Registration with the State. If the partners elect to
file a Statement of Partnership Registration, then the Statement must include:
(1) the name of the general partnership; (2) the address of the chief executive
officer of the partnership and the address for the principal office of the
partnership; and (3) the names and mailing addresses of all of the partners or
the name and address of an agent who shall maintain a list of the names and
mailing addresses of all of the partners. The fee to file a Statement of
Partnership Registration is currently $50, and the form required to file can be
found at http://www.sunbiz.org.
b. Partnership Agreement. After formation, a written or oral Partnership
Agreement governs the relationship among the partners and between the
partners and the partnership. Where the Partnership Agreement remains
silent, FRUPA governs the relationships among the partners and between the
partners and the partnership. Similar to LLCs, the Partnership Agreement may
not restrict a partner's or former partner's access to books and records and
may not eliminate certain fiduciary duties of loyalty or care, nor the obligation
of good faith and fair dealing.
Although a partnership can be formed without a written Partnership
Agreement, the partners' best interests will be served if their intentions and
corresponding business relationship are clearly stated in a written Partnership
Agreement. In the absence of a written Partnership Agreement, acts and
conduct of the persons involved are tested to determine whether a
partnership was intended.
Generally, a written Partnership Agreement will address the amount of capital
to be contributed to the partnership by the various partners, which
contributions may be made in cash, property, or in-kind services. When a
partner makes a loan to the partnership, such loan should be clearly
documented in writing to avoid the loan being treated as a capital
contribution. Due to the fact that the partners in a general partnership are
personally liable for fulfilling the debts of the partnership, the Partnership
Agreement will often limit the ability of the partnership to borrow funds or
require all partners to approve any such borrowings.
c. Management. Generally, every partner conducting the usual business of the
partnership has the authority to bind the partnership unless the partner has no
authority and the person with whom the partner is dealing is aware of the fact
that the partner has no authority to act on behalf of the partnership. This
general authority may be modified by filing a certificate of partnership with the
Because each partner in a general partnership is financially responsible for the
debts of the partnership, partnerships often appoint a managing partner and
otherwise limit the authority of the other partners. However, problems arise
when third parties are unaware of the limitation of the Partnership Agreement,
because such third parties will not be bound by these limitations and are free
to conduct business with any partner such conduct binds the partnership.
Partnerships are further bound by the acts or omissions of any partner acting
within the scope of the partnership or within the ordinary course of business
of the partnership. Any losses resulting from such actions are the
responsibility of the partnership (and therefore, each of the partners).
Partnership Agreements also frequently address partnership actions outside
the scope of the partnership and require approval of the partners before any
one partner can conduct such business on behalf of the partnership.
d. Profits and Losses. Partners agree among themselves through their
Partnership Agreement as to how and when capital contributions will be
returned, repayment of loans will be made, and the allocation and distribution
of profits and losses to the individual partners. Florida law requires that, if
there is no Partnership Agreement, each partner is repaid his or her capital
contribution and loans, and shares equally in the profit after repayment by the
partnership of all liabilities. If a partnership desires anything other than an equal
share of profits, the Partnership Agreement should specifically provide as
e. Partner Liability. Unless an election is made to become a limited liability
partnership, every partner in a general partnership is jointly and severally liable
for all debts and obligations owed by the partnership, which may be collected
from a partner's personal assets if the partnership is insolvent. Partners are
also personally jointly and severally liable for any wrongful act or omission
made by a partner in the ordinary course of business or with express
partnership authority and any misappropriation of cash or property of a third
person by any of the partners acting within the scope of his or her apparent
A newly admitted partner to an existing partnership shall not be liable for any
liabilities incurred before he or she was admitted to the partnership, however
the newly admitted partner may see a reduced value in the partnership due to
any such outstanding obligations, as such obligations may still be settled from
the existing partnership property.
This treatment of liability is a significant detriment to forming a general
partnership for a number of businesses, especially where other entities exist
that better limit the liability of their principals. There are certain techniques to
limit exposure to partners, such as limits on liability negotiated in particular
documents of the partnership, such as loans or leases, as well as the
procurement of liability insurance, but none of these can fully hedge the risk of
the potential liability of a general partnership.
f. Transferability of Partnership Interests. Under Florida law, a partner may
transfer his or her interest in the partnership's profits to another person without
causing the dissolution of the partnership, but the assignee does not become
a partner in the partnership and is not entitled to participate in the
management or administration of the partnership's affairs. Unless modified by
the Partnership Agreement, this interest is a profits-only interest, and the
transferee does not become a partner without further action by the partners of
the partnership to make the transferee a partner. Under Florida law, a
partner's interest in a partnership is personal property.
A partner's interest in a partnership may be subject to a charging order upon
application by a judgment creditor of a partner or a partner's transferee to a
court having jurisdiction. The court may charge the transferable interest of the
judgment debtor to satisfy the judgment, and this charge constitutes a lien on
the transferable interest of the judgment debtor in the partnership. The court
may order a foreclosure of the interest subject to the charging order at any
time and the purchaser at the foreclosure sale has the rights of a transferee to
receive profits from the partnership.
g. Dissolution or Termination of the Partnership. A general partnership can exist
perpetually or be limited to a fixed timeframe of existence as set forth in the
Partnership Agreement. If the partnership is perpetual and at-will, dissolution
is caused when the partnership gets notice of any partner's (other than a
dissociated partner) intent to withdraw as a partner from the partnership. In the
case of a partnership for a fixed term, the partnership may be dissolved by the
end of the fixed term, by the mutual agreement of all partners to wind up the
affairs of the partnership, by the occurrence of any event which makes it
unlawful for the partnership to continue its business, by the death of any
partner, by the bankruptcy of any partner or the partnership, or by judicial
Once a partnership has been dissolved, it is not terminated until the process
of winding up its business is completed. The authority of the remaining
partners in the partnership that has elected to dissolve is limited to any
authority necessary to complete the task of winding up the business.
In winding up the business, the assets of the partnership, including the
contributions of the partners, must be applied to discharge the partnership's
obligations to creditors, including partners who are creditors. Any surplus
after the obligations of the partnership are paid shall be distributed to the
partners in accordance with their right to distributions as set forth in the
Partnership Agreement or under Florida law.
If the liabilities of the partnership exceed the assets of the partnership, the
creditors of the partnership may look to the partners to fulfill the outstanding
obligations of the partnership. In the event any partner is insolvent or cannot
be sued for his or her contribution and refuses to make such contribution, the
remaining partners shall be required to contribute additional amounts
necessary to satisfy the remaining obligations.
3.3.3 Limited Partnerships
The Florida Revised Uniform Limited Partnership Act ("FRULPA") governs Florida limited
partnerships. A limited partnership may be formed for any lawful purpose, including not-forprofit
a. Formation. A Florida limited partnership is formed when at least two persons
decide to form and operate a limited partnership with at least one of the
partners being a general partner and at least one of the partners being a
limited partner. To complete the formation, a Certificate of Limited Partnership
must be filed with the Department of State and must contain: (1) the name of
the limited partnership; (2) the address of the limited partnership's principal
office and the name and address of the initial registered agent in the State of
Florida; (3) the names and addresses of the general partners; and (4) a
statement (or election) as to whether the limited partnership is a limited liability
limited partnership. The name of the limited partnership must contain the
words "Limited Partnership" or "Limited" or the abbreviation "L.P." or "Ltd." or
the designation "LP." The current filing fee for a limited partnership is $1,000
($965 for filing and $35 for designation of a registered agent), and forms for
filing can be found at http://www.sunbiz.org. The Department of State
requires the limited partnership to file an annual report by May 1 of the
subsequent year, and the current filing fee is $500 if filed timely or $900 if filed
b. Partnership Agreement. Once formed, the limited partnership's Partnership
Agreement and the FRULPA govern the operation and management of the
limited partnership. As with general partnerships, the Partnership Agreement
may be oral or written and is subject to the same limitation on elimination of
fiduciary duties of loyalty or care and the obligation of good faith and fair
dealing as a general partnership. Limited partnerships can be capitalized
through the same means as a general partnership.
A limited partnership may file a Statement of Partnership Authority with the
Department of State. The Statement of Partnership Authority sets forth the
names of the partners authorized to execute an instrument transferring real
property held in the name of the partnership, and may also state or include
the authority, or limited on the authority, of some or all of the partners to enter
into other transactions on behalf of the partnership, or any other matter.
Except in transactions involving real property, third parties entering into
transactions with the partnership are deemed to have knowledge of the
authority granted under the Statement of Partnership Authority filed with the
Department of State. Third parties entering into transactions with the
partnership involving real property are deemed to have knowledge when the
Statement of Partnership Authority is recorded in the office for recording
transfers of such real property. Authority granted under a Statement of
Partnership Authority may be revoked upon the filing of a cancellation with the
Department of State.
Because under a limited partnership, the limited partners are not liable for the
obligations of the partnership but general partners are, third party financing is
obtained somewhat differently than under a general partnership. In
determining whether to make a loan to the partnership, third party lenders will
rely primarily on the limited partnership's assets and operations and on the
creditworthiness of the general partners. The Partnership Agreement may also
provide for the addition of new limited partners as a means to raise additional
capital for the partnership.
c. Management. Typically, the general partner or partners manage the business
and activities of the limited partnership. General partners in a limited
partnership manage the partnership subject to those restrictions on authority
present in a general partnership. Limited partners do not have the authority to
bind the limited partnership. The Partnership Agreement should clearly
delineate the authority granted to the general partner and any limitations on
that authority. Certain management actions may be set forth in the Partnership
Agreement to require the approval of various numbers of partners. If there is
more than one general partner, the Partnership Agreement can provide for the
differentiation of authority of each of the general partners.
Unless otherwise provided in the Partnership Agreement, the general partner
has the authority to delegate his or her rights and powers to manage the
limited partnership. Subject to the Partnership Agreement, the general partner
also maintains the books and records of the limited partnership. FRULPA sets
forth the rights of the limited partners to certain information, including financial
information, regarding the limited partnership, but the general partners of the
limited partnership have the rights and powers subject to the restriction of a
partner in a general partnership.
d. Profits and Losses. Just like a general partnership, the limited partnership
may choose to allocate profits and losses according to the Partnership
Agreement, and it is advised to do so if the partners wish to avoid the default
statutory rule regarding profits and losses. If no such provision is in place in
the Partnership Agreement, profits and losses and distributions of the limited
partnership shall be allocated among the partners on the basis of the value of
the contributions made by each partner, as stated in the partner's capital
e. Liability of the Partners. In Florida, an obligation of a limited partnership,
whether arising in contract, tort, or in some other fashion, is not an obligation
of the limited partners. A limited partner is not personally liable, directly or
indirectly, by way of contribution or otherwise, even if the limited partner
participates in the management of the business. The general partners,
however, jointly and severally share all liability for all obligations of the limited
partnership. As with a general partnership, a general partner who is admitted
to a partnership is not liable for the obligations incurred by the partnership
prior to the new general partner's admission.
f. Transferability of Limited Partnership Interest. Transfers of limited partnership
interests are governed by FRULPA but are treated similarly to general
partnerships. The profits interest of the personal property is transferable, but
the transferee is not made a partner in the partnership without approval from
the current partners.
The Partnership Agreement may provide for evidence of the interest in the
limited partnership in the form of certificates, which may be assigned and
evidence the interest transferred. Partnership interests may also be the
subject of a charging order in the same fashion as the interests of general
partnerships, except that no foreclosure of the interest in a limited partnership
is available to judgment creditors.
g. Dissolution or Termination of the Limited Partnership. Dissolution occurs upon
one of the following events: (1) an event set forth in the Partnership
Agreement; (2) the consent of all general partners and all limited partners;
(3) the dissociation of a person who is a general partner; (4) the passage of
90 days after the dissociation of the limited partnership's last limited partner,
unless before the end of the period the limited partnership admits at least one
limited partner; (5) the signing and filing of a Declaration of Dissolution by the
Department of State; or (6) a circuit court orders the LP to dissolve.
Once a limited partnership has been dissolved, it is not terminated until the
process of winding up its business is completed. The authority of the
remaining general partners in the limited partnership that has elected to
dissolve is limited to any authority necessary to complete the task of ending
the business. If there are no general partners remaining to wind up the affairs
of the limited partnership, the individual appointed to wind up the activities of
the limited partnership shall be appointed by the consent of the limited
partners owning a majority of the rights to receive distributions as limited
partners at the time the consent is effective.
In winding up the business, the assets of the limited partnership, including the
contributions of the partners, must be applied to discharge the limited
partnership's obligations to creditors, including partners who are creditors.
Any surplus after the obligations of the limited partnership are paid shall be
distributed to the partners in accordance with their right to distributions as set
forth in the Partnership Agreement or under Florida law.
If the liabilities of the limited partnership exceed the assets of the limited
partnership, the creditors of the limited partnership may look to the general
partners to fulfill the outstanding obligations of the limited partnership. In the
event any general partner is insolvent or cannot be sued for his or her
contribution and refuses to make such contribution, the remaining general
partners shall be required to contribute additional amounts necessary to
satisfy the remaining obligations.
3.3.4 Limited Liability Partnerships
FRUPA also governs Florida limited liability partnerships. An LLP is essentially a general
partnership that has made an election to be treated as a limited liability partnership. A general
partnership may be formed as, or may later become, an LLP pursuant to FRUPA.
Generally, an LLP is managed and operated in the same fashion as a general partnership, but
partners of an LLP have different liabilities then partners of a general partnership. An obligation
of a limited liability partnership, whether arising in contract, tort or otherwise, is solely the
obligation of the LLP, and no partner of an LLP is liable for an obligation of the LLP solely by
reason of being or acting as a partner. Essentially, by electing to form an LLP, a general
partnership is agreeing to observe extra filing requirements and formalities in exchange for a
limit of the partners' liabilities.
In order for an existing general partnership to become an LLP, there must be a vote to amend
the Partnership Agreement and a filing of a Statement of Qualifications with the Department of
State. To form initially as an LLP, a general partnership must file a Statement of Qualification in
accordance with FRUPA at the time of initial formation.
The Statement of Qualification must contain all of the information required to file a general
partnership and a statement that the partnership elects to be a limited liability partnership.
Further, the name of the LLP must contain as the last words of its name "Registered Limited
Liability Partnership, "Limited Liability Partnership," the abbreviations "R.L.L.P.," "L.L.P.," or the
designation "RLLP" or "LLP."
The filing fees for a statement of qualification are currently $25. An LLP must also file an annual
report with the Department of State by May 1 of the subsequent year, and the current filing fees
for the annual report are $25. Forms required for filing are available at http://www.sunbiz.org.
3.3.5 Limited Liability Limited Partnerships
FRULPA also governs Florida limited liability limited partnerships. An LLLP is essentially a limited
partnership that has made an election to be treated as a limited liability limited partnership. A
limited partnership may be formed as, or may later become, an LLLP pursuant to FRULPA.
Generally, an LLLP is managed and operated in the same fashion as a limited partnership, but
the general partners of an LLLP have different liabilities from the general partners of a limited
partnership. An obligation of a limited liability limited partnership, whether arising in contract, tort
or otherwise, is solely the obligation of the LLLP, and no general partner is liable for such
obligation of the LLLP solely by reason of being or acting as a general partner (it is also the
case that, as with limited partnerships, the limited partners of an LLLP are not liable for the
obligations of the LLLP).
In order for an existing limited partnership to become an LLLP, there must be a vote to amend
the Partnership Agreement and the filing of an Amended or Restated Certificate of Limited
Partnership with the Department of State signed by all general partners. To form initially as an
LLLP, a limited partnership must elect in the initial Certificate of Limited Partnership to be
formed as an LLLP.
Further, the name of the LLLP must contain as the last words of its name "Limited Liability
Limited Partnership," the abbreviations "L.L.L.P.," or the designation "LLLP."
3.4 Florida Sole Proprietorships
3.4.1 Introduction
Persons conducting a social enterprise alone in the State of Florida without the protections
afforded by incorporation are called sole proprietors. A sole proprietorship has no legal
existence apart from its owner, which means that the owner of a sole proprietorship is
personally liable for the debts and obligations of the proprietorship. Profits and losses are
borne directly by the proprietor. The proprietor may operate under a fictitious name that is
registered with the Florida Department of State. See www.sunbiz.org. Such registration
provides limited protection for exclusive use of the name, absent trademark or service mark
3.4.2 Advantages and disadvantages
The main advantage of forming a sole proprietorship is that it may be formed without any
expense or formality. The main disadvantage of forming a sole proprietorship is that the owner
is wholly liable for all debts and obligations of the enterprise; all of the personal assets of the
owner and any other assets devoted to the enterprise can be seized to make payments. In
addition, a sole proprietorship itself cannot be sold since there is complete unity between the
enterprise and its owner, although the assets used in the enterprise can be sold. A sole
proprietorship generally terminates upon the death of its owner.
3.5 Florida Joint Ventures
A joint venture is not a statutory entity or form of doing business in the State of Florida. Rather,
it is a contractual arrangement whereby more than one person or entity join forces to operate a
venture. Many joint ventures operate by agreement only; the participants do not have to create
a separate entity as the vehicle for a joint venture. However, nonprofit corporations, for-profit
corporations and limited liability companies can each function as the entity vehicle for joint
3.6 Florida Not For Profit Corporations
3.6.1 Introduction
The Florida Not For Profit Corporation Act governs the formation, operation and dissolution of
nonprofit corporations in the State of Florida. A nonprofit corporation in Florida is managed by
its board of directors and operated by its officers and employees. Instead of shareholders, a
nonprofit corporation may, but is not required to, have members. Nonprofit corporations, of
course, are specifically organized to not earn profits. No part of the income or surplus of a
Florida nonprofit corporation may be distributed to its members, directors or officers; however,
reasonable compensation may be paid for services rendered.
A nonprofit corporation has an existence of its own independent of the terms of office or
employment of members, directors or officers. It can sue or be sued in its own name and can
own real estate or other assets in its own name.
3.6.2 Advantages and Disadvantages
Where profit is not a goal and the enterprise can be funded without the need for access to
capital, the nonprofit corporation is the preferred vehicle for pursuing social objectives. Although
nonprofit corporations are not prohibited from engaging in commercial activities, the directors of
a nonprofit are duty-bound to devote primary attention to the promotion of the social mission of
the nonprofit corporation rather than the production of net income.
On the other hand, if outside capital is needed, a for-profit corporation (or limited liability
company) is likely to be the preferred option because nonprofit corporations cannot issue
capital stock. The directors of a for-profit corporation owe strict duties to the shareholders to
maximize profits and value. Therefore, unless the directors and managers can tie the social
mission of their for-profit corporation directly to its business purpose, they can be sued for
breach of their duties to shareholders and for misuse of corporate assets if they focus too
much on the social mission and forego profits. To address this concern, Florida authorizes the
business corporations to become social purpose corporations (Sections 607.501 et seq. of
the Florida Business Corporation Act) or benefit corporations (Sections 607.601 et seq. of the
Florida Business Corporation Act), each of which is further discussed in Section 3.7 of this
3.6.3 Formation
A nonprofit corporation attains its separate legal status through the filing and approval by the
Department of State of the State of Florida of its Articles of Incorporation. This document is in
essence a contract between the state and the nonprofit corporation in which the State of
Florida grants individual legal status to the nonprofit corporation in exchange for the nonprofit
corporation's commitment to follow its rules.
The Florida Not For Profit Corporation Act requires that the Articles of Incorporation of a
nonprofit corporation include (a) the name and street address of the initial principal office and, if
different, the mailing address, of the nonprofit corporation; (b) the purpose(s) for which the
nonprofit corporation is being organized; (c) a statement of the manner in which the directors
are to be elected or appointed (or the Articles may specify that the method of election is
contained in the nonprofit corporation's Bylaws); (d) any provisions, not inconsistent with the
Florida Not For Profit Corporation Act, which limit in any manner the corporate powers or the
nonprofit corporation authorized under the Act; (e) the street address of the nonprofit
corporation's initial registered office and the name of its initial registered agent at that address,
together with a written acceptance of appointment as a registered agent; and (f) the name and
address of each incorporator.
In addition, the Articles may set forth (1) the names and addresses of the initial directors; (2) any
provision, not inconsistent with law, regarding the regulation of the nonprofit corporation's
internal affairs; (3) the manner of termination of membership in the nonprofit corporation; (4) the
rights upon termination of membership; (5) the transferability of membership; (6) the distribution
of assets upon dissolution or final liquidation; (7) any designation of one or more classes of
members; (8) the names of any persons or the designation of any groups of persons who are
to be the initial members; (9) a provision to the effect that the nonprofit corporation will be
subordinate to and subject to the authority of any head or national association; and (10) any
provision that is required or may be set forth in the Bylaws of the nonprofit corporation. The
Articles of Incorporation must be in writing in English and be executed by the incorporator. The
Articles may, but need not contain the corporate seal, an attestation by the secretary or
assistant secretary, or an acknowledgement, verification or proof. The Articles of Incorporation
must be delivered to the Florida Department of State in Tallahassee, Florida.
A nonprofit corporation may, but is not required to, have members.
3.6.4 Management and Control
Once the nonprofit corporation has been established, the initial board of directors must meet (in
person/by consent) to ratify the acts in connection with the initial formation of the nonprofit
corporation and adopt Bylaws which set forth the rules and procedures governing the decisionmaking
process of the board of directors and the general operation and management of the
nonprofit corporation consistent with the applicable statutes of the State of Florida and the
Articles of Incorporation. If the initial directors are not named in the Articles of Incorporation, the
incorporators must hold an organizational meeting at the call of a majority of the incorporators to
elect directors and complete the organization of the nonprofit corporation.
Typically, the Bylaws of a nonprofit corporation contain provisions governing member, director
and officer qualifications, powers, and duties; voting; filling of vacancies; meetings; property
holding and transfer; indemnification of directors and officers; committees; bank accounts;
fiscal year audits and financial reports; conflicts of interest; and amendment and dissolution
The power to alter, amend, or repeal the Bylaws or adopt new Bylaws is vested in the board of
directors unless otherwise provided in the Articles of Incorporation or the Bylaws.
3.6.5 Liability of Members, Directors and Officers
A nonprofit corporation may, but is not required to, have members. A member of a Florida
nonprofit corporation is not, as such, personally liable for any act, debt, liability or obligation of
the nonprofit corporation, however, a member may become liable for dues, assessments, or
fees, as provided by law.
Directors and officers who are a party to any proceeding (other than an action by, or in the right
of the nonprofit corporation) may be indemnified by a Florida nonprofit corporation by reason of
the fact that such person was serving as a director or officer of the nonprofit corporation
against liability in connection with such proceeding, including any appeal therefrom, if such
person acted in good faith and in a manner they believed to be in, or not opposed to, the best
interests of the nonprofit corporation and, with respect to any criminal action or proceeding,
had no reasonable cause to believe that their conduct was unlawful.
Section 617.0834 of the Florida Not For Profit Corporation Act grants immunity from civil liability
to officers and directors of nonprofit corporations organized under § 501(c)(3), 501(c)(4) or
501(c)(6) of the Internal Revenue Code of 1986, as amended (the "Code"), or of an agricultural
or a horticultural organization recognized under § 501(c)(5) of the Code, for any statement,
vote, decision, or failure to take an action, regarding organizational management or policy by an
officer or director, unless: (a) the officer or director breached or failed to perform his or her
duties as an officer or director; and (b) the officer's or director's breach of, or failure to perform,
his or her duties constitutes: (i) a violation of the criminal law, unless the officer or director had
reasonable cause to believe his or her conduct was lawful or had no reasonable cause to
believe his or her conduct was unlawful. A judgment or other final adjudication against an officer
or director in any criminal proceeding for violation of the criminal law estops that officer or
director from contesting the fact that his or her breach, or failure to perform, constitutes a
violation of the criminal law, but does not estop the officer or director from establishing that he
or she had reasonable cause to believe that his or her conduct was lawful or had no
reasonable cause to believe that his or her conduct was unlawful; (ii) a transaction from which
the officer or director derived an improper personal benefit, directly or indirectly; or (iii)
recklessness or an act or omission that was committed in bad faith or with malicious purpose
or in a manner exhibiting wanton and willful disregard of human rights, safety, or property.
3.6.6 Mergers, Acquisitions and Dissolution
Section 617.1102 of the Florida Not For Profit Corporation Act provides that a nonprofit
corporation organized under the laws of the State of Florida may merge with one or more other
business entities only if the surviving entity of such merger is a nonprofit corporation or other
business entity that has been organized as a not-for-profit entity under a governing statute or
other applicable law that allows such a merger.
Sections 617.1402 and 617.1403 of the Florida Not For Profit Corporation Act governs the
dissolution of Florida nonprofit corporations. Section 617.1402 provides that a nonprofit
corporation desiring to dissolve and wind up its affairs must adopt a resolution to dissolve as
a. If the nonprofit corporation has members. If the nonprofit corporation has
members entitled to vote on a resolution to dissolve, and unless the board of
directors determines that because of a conflict of interest or other substantial
reason it should not make any recommendation, the board of directors must
adopt a resolution recommending that the nonprofit corporation be dissolved
and directing that the question of such dissolution be submitted to a vote at a
meeting of members entitled to vote thereon, which may be either an annual
or special meeting. Written notice stating that the purpose, or one of the
purposes, of such meeting is to consider the advisability of dissolving the
nonprofit corporation must be given to each member entitled to vote at such
meeting in accordance with the Articles of Incorporation or the Bylaws. A
resolution to dissolve the nonprofit corporation shall be adopted upon
receiving at least a majority of the votes which members present at such
meeting or represented by proxy are entitled to cast.
b. If the nonprofit corporation has no members. If the nonprofit corporation has
no members or if its members are not entitled to vote on a resolution to
dissolve, the dissolution of the nonprofit corporation may be authorized at a
meeting of the board of directors by a majority vote of the directors then in
At any time after dissolution is authorized, the nonprofit corporation may dissolve by delivering
Articles of Dissolution to the Department of State for filing, which Articles of Dissolution must set
forth: (a) the name of the nonprofit corporation; (b) if the nonprofit corporation has members
entitled to vote on dissolution, the date of the meeting of members at which the resolution to
dissolve was adopted, a statement that the number of votes cast for dissolution was sufficient
for approval, or a statement that such a resolution was adopted by written consent and
executed in accordance with applicable law; and (c) if the nonprofit corporation has no
members or if its members are not entitled to vote on dissolution, a statement of such fact, the
date of the adoption of such resolution by the board of directors, the number of directors then
in office, and the vote for the resolution. A nonprofit corporation is dissolved upon the effective
date of its Articles of Dissolution.
3.6.7 Recordkeeping and State Reports
In accordance with § 617.1601 of the Florida Not For Profit Corporation Act, a nonprofit
corporation must keep copies of the following records: (a) its Articles of Incorporation or
restated Articles of Incorporation and all amendments to them currently in effect; (b) its Bylaws
or restated Bylaws and all amendments to them currently in effect; (c) the minutes of all
members' meetings and records of all action taken by members without a meeting for the past
3 years; (d) written communications to all members generally or all members of a class within
the past 3 years, including the financial statements furnished for the past 3 years under §
617.1605 of the Florida Not For Profit Corporation Act; (e) a list of the names and business
street, or home if there is no business street, addresses of its current directors and officers;
and (f) its most recent annual report delivered to the Department of State under § 617.1622 of
the Florida Not For Profit Corporation Act.
Section 617.1622 of the Florida Not For Profit Corporation Act requires that each nonprofit
corporation organized or qualified to do business in Florida file an annual report. The annual
report must set forth: (a) the name of the nonprofit corporation and the state or country under
the law of which it is incorporated; (b) the date of incorporation or, if a foreign corporation, the
date on which it was admitted to conduct its affairs in the State of Florida; (c) the address of the
principal office and the mailing address of the nonprofit corporation; (d) the nonprofit
corporation's federal employer identification number, if any, or, if none, whether one has been
applied for; (e) the names and business street addresses of its directors and principal officers;
(f) the street address of its registered office in the State of Florida and the name of its registered
agent at that office; and (g) such additional information as may be necessary or appropriate to
enable the Department of State to carry out the provisions of the Florida Not For Profit
Corporation Act. The deposit of such report, on or before May 1, in the United States mail in a
sealed envelope, properly addressed with postage prepaid, constitutes compliance with the
foregoing provisions.
For more information on filing annual reports in Florida, see Chapter 2 of this Guide [General
Regulation of Business in Florida].
3.6.8 Insurance
Nearly every type of activity by a nonprofit corporation can become the target of some kind of a
claim by a firm or an individual that alleges damage or injury by the nonprofit corporation or
individuals responsible for it (i.e., directors, officers or employees). Even if the claim is without
merit, the costs of defending against the claim can be very substantial. To encourage qualified
individuals to accept positions as directors and officers, many nonprofit corporations purchase
insurance to cover director and officer (D&O) liability. In addition, most responsible nonprofit
corporations purchase a basic comprehensive general liability policy that covers liability for
accidents in the nonprofit corporation's offices, at sponsored meetings and the like. Liability
insurance for nonprofit corporations is often a very complicated matter. Consultation with an
experienced and knowledgeable agent or consultant is essential in order to obtain the right
coverage at the lowest premium.
3.6.9 Tax Exempt Status
Forming an organization as a nonprofit corporation does not necessarily indicate that it is also a
tax exempt organization. In order for the nonprofit corporation to also be classified as a tax
exempt organization, it must (a) qualify as an exempt organization under the Code, and
(b) obtain a determination letter on tax exempt status by filing a Form 1023 (for 501(c)(3)
corporations) or Form 1024 (for other exempt organizations) with the IRS. The laws and
regulations governing tax exemption and the process of obtaining tax exempt status are highly
complex. Consultation with an experienced and knowledgeable tax attorney or other tax
advisor is strongly recommended when a nonprofit corporation is considering applying for tax
exempt status.
3.7 Florida Benefit and Social Purpose Corporations
3.7.1 Introduction
Traditionally, the corporate form has, above all, required that corporations work in the best
interest of their shareholders, and corporations have been vulnerable to shareholder lawsuits if
they did otherwise. However, a growing trend has emerged allowing corporations to form as
"Benefit" or "Social Purpose" corporations.
Florida is one of three states that allow for "Social Purpose" corporations, which are for-profit
entities that enable the corporation, instead of maximizing shareholder profit, to consider social
or environmental issues. A "Benefit Corporation", which is allowed in 30 states and the District
of Columbia, is a similar organization that is formed for a "general public benefit".
3.7.2 Formation
Both Social Purpose Corporations and Benefit Corporations are formed by the same rules as
those of general Florida Corporations. In addition to the requirements of formation of a Florida
Corporation, both Social Purpose Corporations and Benefit Corporations must specify certain
other information with regard to their election.
The Articles of Incorporation of a Special Purpose Corporation must set forth one or more
specific public benefits of the corporation in addition to its purpose under general corporate
law. A "public benefit" is defined as one that has a positive effect (or the minimization of
negative effects), taken on a whole, on the environment or one or more categories of persons
or entities, other than shareholders in their capacity as shareholders. The statute lays out
certain examples public benefits, such as: (i) providing low-income or underserved individuals
or communities with beneficial products or services, (ii) promoting economic opportunity for
individuals or communities beyond the creation of jobs in the normal course of business, (iii)
protecting or restoring the environment, (iv) improving human health, (v) promoting the arts,
sciences, or advancement of knowledge, and (vi) increasing the flow of capital to entities that
have as their stated purpose the provision of a benefit to society or the environment.
A Benefit Corporation has the purpose of creating general corporate public benefit. The
Articles of Incorporation of a Benefit Corporation "may identify one or more specific public
benefits as its purpose in addition to the general public benefit". The statute lays out an
identical list of specific public benefits as for Special Purpose Corporations, but adds as an
example "Any other public benefit consistent with the purposes of the Benefit Corporation".
3.7.3 Management
Both Special Purpose and Benefit Corporations are subject to the same Officer and Director
rules as general Florida Corporations. However, the statutes set forth additional requirements
and standards of conduct for each type of entity.
Directors of a Social Purpose Corporation must, in addition to their general duties as directors,
consider the effects of any action or inaction on not only the Social Purpose Corporation's
shareholders but also on its ability to accomplish its public benefit or specific public benefit
purpose. Additionally, a director of a Social Purpose Corporation may consider the effects of
any action or inaction on the employees and work force of the Social Purpose Corporation, its
subsidiaries and suppliers, on the interests of customers and suppliers as beneficiaries of the
public benefit or specific public benefit purpose, on community and societal factors, on the
local and global environment, and on the short-and-long term interests of the Social Purpose
Directors of a Benefit Corporation have similar duties, except that they must (rather than may)
consider the effects of any action on each of the above, and may also consider other pertinent
factors that they deem appropriate.
Both Social Purpose and Benefit Corporations may specify a "Benefit Director". This director, in
addition to his or her general duties as a director, must also include in the Annual Benefit
Report his or her opinion on whether the corporation complied with its benefit purpose and
whether the officers or other directors have complied with their duties.
Officers of a Social Purpose Corporation or Benefit Corporation may consider the same factors
as directors in performing their duties as an officer. Social Purpose Corporations or Benefit
Corporations may also specify a "Benefit Officer", who has the duty of preparing the Annual
Benefit Report.
3.7.4 Annual Benefit Report
Both Social Purpose and Benefit Corporations are required to prepare for their shareholders an
"Annual Benefit Report", which is a narrative description of the ways in which the public benefit
has actually been benefited and any circumstances that hindered that benefit. The Articles of
Incorporation may also set forth that the Annual Benefit Report must be prepared by some third
party standard, and if it is, the Report must set forth the rationale for that standard, as well as
any rationale for changing the standard.
The Annual Benefit Report must be sent to all shareholders no later than 120 days following the
end of the fiscal year, or at the same time the corporation delivers any other required annual
report to its shareholders. Failure to submit an Annual Benefit Report may result in a court order
to furnish and payment of attorney's fees to a shareholder who brings suit for such purpose.
Securities Regulation
Alan H. Aronson, Esq. | (305) 982-5562 | firstname.lastname@example.com
The following is intended to provide a very general overview of the basic regulation of offerings, issuance
and transfers of securities under Florida law. There are many exceptions and special rules that could
apply. Parties are urged to contact a Lex Mundi-affiliated securities advisor regarding the imposition of
United States federal and Florida securities regulations on issuers, investors and their respective
business activities.
4.1 Introduction
In addition to legal requirements under federal law, securities in Florida are regulated under the
Florida Securities and Investor Protection Act (the "Act") (Chapter 517 of the Florida Statutes).
The Act is administered by the Securities Division of the Florida Office of Financial Regulation
(the "Office"). The contact information for the Office is as follows: 200 East Gaines Street,
Tallahassee, FL 32399; Tel: (850) 487-9687.
Section 517.021(22) of the Act, broadly defines "security" to include any of the following: (a) a
note; (b) a stock; (c) a treasury stock; (d) a bond; (e) a debenture; (f) an evidence of
indebtedness; (g) a certificate of deposit; (h) a certificate of deposit for a security; (i) a certificate
of interest or participation; (j) a whiskey warehouse receipt or other commodity warehouse
receipt; (k) a certificate of interest in a profit-sharing agreement or the right to participate
therein; (l) a certificate of interest in an oil, gas, petroleum, mineral, or mining title or lease or the
right to participate therein; (m) a collateral trust certificate; (n) a reorganization certificate; (o) a
preorganization subscription; (p) any transferable share; (q) an investment contract; (r) a
beneficial interest in title to property, profits, or earnings; (s) an interest in or under a profitsharing
or participation agreement or scheme; (t) any option contract which entitles the holder
to purchase or sell a given amount of the underlying security at a fixed price within a specified
period of time; (u) any other instrument commonly known as a security, including an interim or
temporary bond, debenture, note, or certificate; (v) any receipt for a security, or for subscription
to a security, or any right to subscribe to or purchase any security; and (w) a viatical settlement
Pursuant to § 517.07 of the Act, it is unlawful and a violation of the Act for any person to sell or
offer to sell a security within the State of Florida1 unless the security is exempt under § 517.051
of the Act; is sold in an exempt transaction under § 517.061 of the Act; is a federally covered
security; or is registered pursuant to the Act.
1 Note that typically the sale or offer to sell a security to a resident of the State of Florida is within the scope of the Act, irrespective
if the purchaser or intended purchaser is not physically located at the time of purchase or offer to purchase within the geographical
boundaries of the State of Florida.
4.2 Registration of Securities
(a) Registration by Qualification. Section 517.081 of the Act authorizes the Office to
prescribe forms, the filing of documents, the furnishing of information and the payment
of fees for the registration of securities, which are not otherwise entitled to be
registered by notification, as more fully described below. The Office utilizes the
Regulatory Enforcement and Licensing (REAL) System for the registration of securities
offerings. This online system enables filers to submit their application form and fees
electronically. Paper applications received by the Office will not be accepted but will be
returned to the applicant with instructions for filing electronically.
The Office has prescribed rules for registering securities by qualification in Chapter
69W-700, F.A.C. Those rules relate to the following: (1) the filing of a prospectus; (2)
the contents of a prospectus; (3) circulation of a preliminary prospectus; (4) promoters
equity investment ratio; (5) voting rights; (6) options or warrants granted to
underwriters; (7) options or warrants granted to officers, employees and others;
(8) escrow of proceeds from the sale of securities; (9) preferred stock or debt
securities; (10) fractional undivided interests in oil and gas titles; (11) oil and gas
participation plans; (12) insurance company licenses; (13) real estate investment
trusts; (14) offering price of equity securities; (15) submission of sales reports; (16)
termination date of registration (the date on which a prospectus may no longer be
used); (17) independent transfer agent and/or registrar; (18) amendments subsequent
to effectiveness; (19) unsound financial condition of issuer; and (20) loans and other
affiliated transactions.
An application to register securities must include (1) Application for Registration of
Securities—Form OFR-S-1-91; (2) an irrevocable written Uniform Consent to Service
of Process—Form OFR-S-5-91, or Form U-2; (4) a Uniform Corporate Resolution—
Form OFR-S-6-91, or Form U-2A; (5) Exhibit I (General Issue)—Form OFR-S-7-91; (6)
financial statements dated within 90 days from the date of filing, provided that yearend
audited statements may be required, depending upon the size of the issuer; (7)
exhibits and additional information as required or requested by the Office; and (8) an
application fee in the amount of $1,000.
(b) Registration by Notification. Pursuant to Section 517.082 of the Act, securities offered
or sold pursuant to a registration statement filed with the Securities and Exchange
Commission (the "SEC") under the United States Securities Act of 1933, as amended
(the "Securities Act"), are entitled to registration by notification, provided that prior to
the offer or sale the registration statement has become effective.
Registration by notification may not be available to register securities where the offering
price at the time of effectiveness with the SEC is $5 or less per share.
An application for registration by notification is required to be filed with the Office and is
required to contain the following information and be accompanied with the following:
(1) an application to sell executed by the issuer, any person on whose behalf the
offering is made, a dealer registered pursuant to the Act, or any duly authorized agent
of any such person setting forth the name and address of the applicant, the name and
address of the issuer, and the title of the securities to be offered and sold; (2) copies
of such documents filed with the SEC as the Office may by rule require; (3) an
irrevocable written consent to service of process; and (4) a nonrefundable fee of
$1,000 per application. An application for notification registration or shelf filing may be
filed on either Uniform Form U-1 or Florida Form OFR-S-3-91. As with registrations by
qualification, the Office utilizes the Regulatory Enforcement and Licensing (REAL)
System for the registration of securities offerings by notification. See Rule 69W-
800.001 for additional filing instructions.
Self-underwritten registered offerings, either by qualification or notification, may require
the issuer to register as a dealer under the Act, and may also require those principals
of the issuer who are involved in the offering and selling of such securities to become
registered under the Act as a registered representative of such issuer, as further
described below.
4.3 Exempt Securities
Section 517.051 of the Act contains a list of securities that are exempt from the registration
requirements under the Act (Section 517.07). The exemptions are self-executing, thus no filing
with the Office is required to claim an exemption, although the burden of proof as to the
applicability of the exemption remains on the issuer claiming the exemption.
Exempt securities under the Act include the following: (1) certain government securities;
(2) certain bank securities; (3) certain railroad and public service utility securities; (4) certain
bank, trust company, savings institution, building or savings and loan association, international
development bank and credit union securities; (5) certain securities, other than common stock,
providing for a fixed return; (6) certain securities of nonprofit agricultural cooperatives; (7) certain
notes, drafts, bills of exchange, or banker's acceptance; (8) certain securities of not for
pecuniary profit institutions; and (9) certain insurance, endowment policies, annuity contracts,
optional annuity contracts and self-insurance agreements. Please note that the foregoing list is
qualified in its entirety by the provisions of Section 517.051 of the Act.
4.4 Exempt Transactions
Section 517.061 of the Act contains a list of transactions that are exempt from the registration
requirements under the Act (Section 517.07). The exemptions are self-executing, thus no filing
is required to be made with the Office to claim an exemption, although the burden of proof as
to the applicability of the exemption remains on the issuer claiming the exemption.
Exempt Transactions under the Act include the following: (1) certain transactions involving a
fiduciary; (2) certain transactions involving a pledgee; (3) certain isolated sales or offers of
securities; (4) certain corporate, trust, or partnership distributions out of earnings or surplus;
(5) certain securities issued to equity security holders or other creditors in the process of a
reorganization of a corporation, trust or partnership; (6) certain distributions of the securities of
an issuer exclusively among its own security holders; (7) certain institutional investor
transactions; (8) certain sales of securities from one corporation to another corporation;
(9) certain offers or sales of securities from one corporation to another corporation, or to
security holders thereof, pursuant to a vote or consent of such security holders in connection
with mergers, share exchanges, consolidations, or sale of corporate assets; (10) the issuance
of certain notes or bonds in connection with the acquisition of real property or renewals thereof;
(11) certain offerings to not more than 35 purchasers in a 12-month period; (12) the sale of
certain securities by a bank or trust company; (13) certain unsolicited purchases or sales of
securities by a dealer registered under the Act; (14) the offer or sale of certain shares of a
corporation which represent ownership of specific apartment units; (15) the offer or sale of
certain securities under an employee benefit plan; (16) the sale by or through a registered
dealer of certain securities options; (17) the offer or sale of certain securities, as agent or
principal, by a dealer registered under the Act, when such securities are offered or sold at a
price reasonably related to the current market price of such securities; (18) the offer or sale of
any security effected by or through a person in compliance with Section 517.12(17) of the Act
(i.e., certain purchases or offers to purchase securities to Canadian residents); (19) other
transactions defined by rules adopted by the Office from time to time; and (20) certain nonissuer
transactions. Please note that the foregoing list is qualified in its entirety by the
provisions of Section 517.061 of the Act.
Note that Florida does not recognize as an exempt transaction a transaction that is exempt
under the Securities Act pursuant to Rule 504 of Regulation D unless such transaction can
otherwise fit within one of the permitted exemptions pursuant to Section 517.061 of the Act. As
under the Securities Act, exemptions under the Act are not mutually exclusive (i.e., transactions
may be exempt under one or more provisions of the Act).
4.5 Broker-Dealer, Investment Advisor Registration
(a) Broker-Dealer. A dealer is any person, other than an associated person under
Chapter 517 of the Act, who engages in the business of offering, buying, selling, or
otherwise dealing or trading in securities issued by another person. Dealers registered
or not with the Financial Industry Regulatory Authority (FINRA) must obtain registration
in the states where they conduct business, including Florida. In addition, pursuant to
Section 517.12(1) of the Act, no dealer, associated person, or issuer of securities
shall sell or offer for sale any securities in or from offices in the State of Florida, or sell
securities to persons in the State of Florida from outside the state, by mail, or
otherwise, unless the person has been registered with the Office pursuant to the
provisions of Chapter 517 of the Act.
The Florida Division of Securities utilizes the Regulatory Enforcement and Licensing
(REAL) System for the registration of dealers that are not members of FINRA. The
online system enables non-FINRA member dealers to submit their application form and
fees electronically. With respect to FINRA members, the Office participates in the
Central Registration Depository (CRD) system for the registration of FINRA member
dealers. The CRD online system enables dealers to register in all desired states and
FINRA via a single electronic form.
All dealers that are members of FINRA shall register with the OFR by filing the
documents and fees prescribed in Section 517.12(10), F.S., and Rules 69W-600.001
and 69W-600.0091, Florida Administrative Code (F.A.C.), through the CRD.
Dealer registration filing requirements are prescribed under Section 517.12(10) of the
Act and Rule 69W-600.001, F.A.C. Typically, an application to register as a dealer or
issuer/dealer must include: (1) a Uniform Application for Broker Dealer Registration,
Form BD; (2) the payment of a statutory fee in the amount of $200; (3) a Uniform
Application for Securities Industry Registration or Transfer, Form U-4; (4) financial
statements and reports as required under Rules 69W-300.002, 69W-600.015, 69W-
600-016 and 69W-600.017, F.A.C.; (5) if applicable, proof of effective registration with
the SEC; (6) proof of insurance by the Securities Investor Protection Company when
required by Section 517.12(16) of the Act,; (7) with respect to any applicant registering
as an issuer/dealer, Issuer/Dealer Compliance Form (OFR-DA-5-91); (8) any direct or
indirect owner or control person required to be reported on Form BD who is not
currently registered in Florida with the firm they are seeking to join or act as a direct or
indirect owner or control person, must submit fingerprint cards in accordance with
69W-600.006(3), F.A.C. and pay the requisite filing fee; (9) when specifically
requested by the Office, full documentation as to affirmative responses to questions
regarding disciplinary action; and (10) when specifically requested by the Office, a
copy of the Articles of Incorporation and amendments thereto, if a partnership, a copy
of the partnership agreement, or if a limited liability company, a copy of the Articles of
An associated person of a dealer means any person who for compensation refers,
solicits, offers, or negotiates for the purchase or sale of securities. A person whose
activities fall within this definition is required to register with the Office as an associated
person of a dealer pursuant to Section 517.12(1) of the Act. The Office will not register
any person as an associated person of a dealer, unless the dealer with which the
associated person seeks registration, is lawfully registered with the Office.
(b) Investment Advisor. An investment adviser is generally defined as any person who
receives compensation in the business of advising others as to the value of securities
or as to the advisability of investments in, purchasing of, or selling of securities.
Investment advisers must obtain registration in the states where they conduct
Pursuant to § 517.12(4), Florida Statutes, no investment adviser or associated person
of an investment adviser or federal covered adviser shall engage in business from
offices in the State of Florida, or render investment advice to person of the State of
Florida, by mail or otherwise, unless the investment adviser is registered pursuant to
the provisions of the Act and associated persons of the federal covered adviser or
investment adviser have been registered with the Office pursuant to Section 517.12
of the Act. Federal covered advisers are defined as investment advisers with more
than $100 million in assets under management, and who typically are required to be
registered with the SEC. No federal covered adviser is permitted to engage in
business from offices in the State of Florida, or render investment advice to Florida
residents, unless the federal covered adviser has made a notice filing with the Office
pursuant to Section 517.1201 of the Act.
An application to register as an investment adviser (other than a federal covered
adviser) must include: (1) a Uniform Application for Investment Advisers Registration,
Form ADV; (2) the payment of a statutory fee in the amount of $200; (3) a Uniform
Application for Securities Industry Registration or Transfer, Form U-4; (4) financial
statements and reports as required under Rules 69W-300.002, 69W-600.015, 69W-
600-016 and 69W-600.017, F.A.C.; (5) any direct or indirect owner or control person
required to report on Form ADV, who is not currently registered in Florida with the firm
they are seeking to join or act as a direct or indirect owner or control person, must
submit fingerprint cards in accordance with 69W-600.006(3), F.A.C.; (6) when
specifically requested by the Office, full documentation as to affirmative responses to
questions regarding disciplinary action; and (7) when specifically requested by the
Office, a copy of the Articles of Incorporation and amendments thereto, if a
partnership, a copy of the partnership agreement, or if a limited liability company, a
copy of the Articles of Organization.
An "associated person" of an investment adviser means any person who for
compensation refers, solicits, offers, or negotiates for the purchase or sale of
investment advisory services. A person whose activities fall within this definition is
required to register with the Office as an associated person of a state registered
adviser pursuant to Section 517.12(4) of the Act. The state registered adviser with
which the associated person seeks registration must be lawfully registered with the
Office. Registration as an associated person of a state registered adviser does not
constitute registration as an associated person of a dealer, or vice-versa. The two
associated person registrations are separate and distinct. The Office participates in the
Central Registration Depository (CRD) system for registration of associated persons for
state registered advisers. All state registered advisers requesting associated person
registration must file the Form U-4, Uniform Application for Securities Industry
Registration or Transfer, documents and fees prescribed in Section 517.12(10) of the
Act, and Rule 69W-600.002, F.A.C., through the CRD. State registered advisers not
dually registered as a FINRA member broker dealer are required to submit fingerprint
results for associated person applicants to the Office.
4.6 Antifraud provisions
Pursuant the Act, it is unlawful and a violation of the provisions of the Act for a person (a) in
connection with the rendering of any investment advice or in connection with the offer, sale, or
purchase of any investment or security, directly or indirectly: (1) to employ any device, scheme,
or artifice to defraud; (2) to obtain money or property by means of any untrue statement of a
material fact or any omission to state a material fact necessary in order to make the statements
made, in the light of the circumstances under which they were made, not misleading; or (3) to
engage in any transaction, practice, or course of business which operates or would operate as
a fraud or deceit upon a person; (b) to publish, give publicity to, or circulate any notice, circular,
advertisement, newspaper, article, letter, investment service, communication, or broadcast
which, though not purporting to offer a security for sale, describes such security for a
consideration received or to be received directly or indirectly from an issuer, underwriter, or
dealer, or from an agent or employee of an issuer, underwriter, or dealer, without fully disclosing
the receipt, whether past or prospective, of such consideration and the amount of the
consideration; or (c) in any matter within the jurisdiction of the Office, to knowingly and willfully
falsify, conceal, or cover up, by any trick, scheme, or device, a material fact, make any false,
fictitious, or fraudulent statement or representation, or make or use any false writing or
document, knowing the same to contain any false, fictitious, or fraudulent statement or entry.
Federal Taxation
William F. Sullivan, Esq. | (954) 468-2464 | email@example.com
Florida State Taxation
Vit M. Gulbis, Esq. | (813) 209-5007 | email@example.com
Russell B. Hale, Esq. | (407) 419-8556 | email@example.com
Brian Goossen, Esq. | (813) 209-5010 | firstname.lastname@example.com
The following is intended to provide a very general overview of the basic United States federal income
taxation of various types of taxpayers and a very general overview of the basic Florida taxation of
common business activities. There are many exceptions and special rules that could apply. Taxpayers
are urged to contact a Lex Mundi-affiliated tax advisor regarding the imposition of United States federal
and Florida state taxes on them and their business activities.
5.1 United States Federal Income Taxation
5.1.1 Federal Taxation of United States Individuals
United States citizens and tax residents are subject to United States federal income taxes on
their worldwide income. The United States tax on worldwide income requires the payment of
taxes on wages, salaries, gains, rents, dividends, interest, royalties and profits of every kind
from all foreign and United States sources. The tax base also includes certain income of
foreign companies controlled by United States citizens and tax residents, including certain
dividends, capital gains, royalties and rents earned by the foreign companies, even if the
income is not paid out to the owners of the companies. Investments in foreign companies and
foreign bank accounts for which a United States citizen or tax resident has signatory authority
must be disclosed annually.
5.1.2 Federal Income Taxation of United States Corporations
United States corporations are subject to United States federal income tax on their worldwide
income. State corporate income taxes are deductible for purposes of calculating the federal
income tax base.
5.1.3 Federal Income Taxation of Nonresident Foreign Individuals
Nonresident foreign individuals who are not classified as United States tax residents are subject
to United States income tax with respect to income which is effectively connected with the
conduct of a trade or business in the United States. This income is subject to tax at the
graduated income tax rates that normally apply to United States individual taxpayers. Such
taxpayers are required to file federal income tax returns in the United States.
A foreign individual generally is considered to be engaged in a United States trade or business
if the individual is engaged in business activities in the United States on a regular basis.
Foreign persons whose United States activities are limited to certain investment activities, such
as trading in stocks or securities for their own account, generally are not considered to be
engaged in a United States trade or business. Payments received for services rendered in the
United States as an employee, independent contractor or otherwise are considered to be
effectively connected income. United States federal income taxation can even extend to
certain types of foreign source income, if attributable to an office or other fixed place of
business within the United States.
Income earned by foreign individuals from the sale of United States real property interests is
treated as income which is effectively connected with a United States trade or business and
taxed as described above, even if the ownership of the real estate is passive. Subject to
certain exceptions which apply to publicly traded companies, income from the sale of shares of
capital stock in a United States corporation with a majority of its assets invested in United
States real estate is also treated as effectively connected income subject to United States
federal income tax. Gains from disposition of United States real property interests are taxed at
the same rates which apply to United States taxpayers.
Buyers of United States real property interests from foreign sellers generally are required to
withhold 10% of the gross purchase price and remit it to the government as a deposit against
the actual tax liability of the foreign seller unless a reduced withholding amount is requested
and approved by the government. Reduced withholding typically will be approved only if the
10% withholding amount exceeds the maximum United States federal income tax liability the
seller can incur on the transaction.
Except for certain gains from the disposition of United States real property interests described
above, capital gains earned by non-resident foreign individuals from the sale of stocks, bonds
and other securities issued by United States companies are not subject to United States
federal income tax unless they are earned in connection with the conduct of a United States
trade or business.
Certain types of income earned by foreign individuals from sources within the United States
which are not effectively connected with the conduct of a United States trade or business are
subject to a flat 30% withholding tax determined without reference to any deductions. Income
subject to the gross 30% withholding tax generally includes dividends and interest paid by
United States corporations, certain interest paid by United States branches of foreign
corporations, rents and royalties for the use of property located in the United States, and other
fixed or determinable annual or periodic income or gains from United States sources. The 30%
tax must be withheld by the person making the payment and remitted to the government. The
30% withholding tax, however, generally does not apply to interest on bank deposits or to
portfolio interest. Portfolio interest generally includes non-contingent interest on registered
obligations paid to payees who do not own, directly or constructively, 10% or more of the
voting power of the payor. The 30% withholding tax also does not apply with respect to rents
received for the use of United States real property where the lessor makes a special election to
treat the rental income as effectively connected income taxed on a net basis after giving effect
to applicable deductions. Liquidating distributions by United States corporations also are
generally exempt from the 30% withholding tax. The 30% withholding tax may be reduced or
even eliminated in cases where the foreign taxpayer receiving the payments qualifies for
benefits under an income tax treaty between the United States and the taxpayer's country of
tax residence. Tax treaties differ, and the specific treaty must be consulted.
Many countries have treaties with the United States to avoid double taxation with respect to
income taxes. Persons who are tax residents of treaty countries may benefit from rules which
are more favorable than the general rules which are summarized above. The availability of
treaty benefits and the scope of such benefits should therefore be considered carefully in each
particular case.
5.1.4 Federal Income Taxation of Foreign Corporations
Foreign corporations generally are subject to United States federal tax in the same manner and
to the same extent as nonresident foreign individuals, described above, although at rates
applicable to corporations.
In addition to the tax imposed on earnings which are effectively connected with a United States
trade or business, foreign corporations which are engaged in a United States trade or business
through a United States branch are also subject to an additional, second-level branch profits
tax. The branch profits tax generally applies to earnings of the United States branch that are
not reinvested in the United States business. It is intended to be a substitute for the
withholding tax that applies to dividends paid to foreign persons and can also apply in cases
where earnings from the conduct of a United States business are not repatriated, but are not
reinvested in the United States business. United States earnings that are not reinvested are
not subject to the branch profits tax if the branch is terminated and several detailed rules are
complied with. Because of the broad scope of the branch profits tax, foreign corporations
frequently conduct United States activities indirectly through United States corporate
subsidiaries. As in the case of the 30% withholding tax, the branch profits tax may be reduced
or eliminated if the foreign taxpayer qualifies for benefits under a tax treaty. The branch profits
tax does not apply to non-corporate taxpayers.
5.1.5 Federal Income Taxation of Unincorporated Businesses or
Foreign individuals conducting business in the United States as a sole proprietorship are
subject to United States federal income taxation on the income earned from United States
activities, with only one level of United States federal income taxation. In the case of a foreign
corporation conducting a United States business directly through a branch, earnings which are
not reinvested in the business may be subject to an additional branch profits tax, as described
above. The branch profits tax does not apply to natural persons.
5.1.6 Federal Income Taxation of Joint Ventures, Partnerships and
Limited Liability Companies
A partnership (including a general partnership, a limited partnership, a limited liability
partnership, or a limited liability limited partnership) or joint venture conducting business in the
United States generally is required to file income tax returns in the United States reporting its
activities. The partnership or joint venture generally is not obligated to pay United States federal
income taxes with respect to its earnings; instead, each of the partners is responsible for
paying United States federal income taxes with respect to its share of income earned by the
partnership or joint venture, as if such share had been earned directly by the partner, even if
none of the income is distributed to the partners. The branch profits tax may apply to a foreign
corporation's share of the United States effectively connected income earned by a partnership
or joint venture of which the foreign corporation is a partner. In addition, the partnership or joint
venture is required, on a quarterly basis, to withhold on the effectively connected income
earned by the partnership or joint venture which is allocable to a foreign partner, and remit this
amount to the government as a deposit against the actual United States federal income tax
liability of the foreign partner. The withholding rate generally is the highest United States income
tax rate which could be applicable to the foreign partner. If the income qualifies for a
preferential rate such as the long-term capital gain tax rate applicable to a non-corporate
taxpayer, such tax rate is applied for purposes of calculating the withholding amount.
The rules of United States federal income taxation of a limited liability company ("LLC") generally
depend upon the number of members of the LLC. If an LLC has only one member, absent an
election to be classified as an association taxable as a corporation, its separate existence
generally is disregarded for United States federal income tax purposes, and its member is
treated as if it owns the LLC's assets and conducts its activities directly. Hence, the LLC is
treated for federal income tax purposes as if it were an unincorporated business or branch
operated by its sole member, and the tax consequences described above with respect to
unincorporated businesses and branches apply. The classification of a single-member LLC as
a disregarded entity applies for United States federal income tax purposes only, and it does not
affect the separation of the legal existence of the LLC from its member.
If an LLC has more than one member, absent an election to be classified as an association
taxable as a corporation, it generally is treated as a partnership for federal income tax purposes,
and the tax consequences described above with respect to partnerships and joint ventures
5.2 Florida State Taxation
The following is intended to provide a very general overview of the basic Florida state taxation of various
types of taxpayers and common business activities. There are many exceptions and complex special
rules that could apply. Taxpayers are urged to contact a Lex Mundi-affiliated tax advisor regarding the
imposition of Florida state taxes on parties and their business activities.
5.2.1 Florida State Sales and Use Tax
Florida imposes a 6% tax on (i) sales at retail and leases of tangible property, (ii) commercial
leases of real estate, (iii) parking spaces and storage, (iv) transient rentals (hotels and short term
residential leases), (v) admissions, and (vi) tangible personal property used, consumed,
distributed, or stored for use or consumption, but not sold in state. Sales/Use Tax is subject to
numerous statutory exemptions and limitations, including:
a. Groceries,
b. Medical equipment,
c. Sales for resale,
d. Casual sales, and
e. Certain industrial and agricultural equipment.
5.2.2 Discretionary County Sales and Use Surtax
When legislatively authorized, counties may levy surtax on transactions subject to sales, use,
services, rentals, admissions, etc. The surtax on most sales is up to 1.5%, but the surtax on
transient rentals can be up to 7%. In both cases, such county taxes are applied in addition to
the 6% state sales tax.
5.2.3 Communications Services Tax
A communications services tax is levied on sales price of communications services which
originate and terminate in this state or originate and terminate in this state and charged to
service address in this state when sold at retail. The rate of this tax varies depending on local
option taxes imposed.
5.2.4 Income Tax on Corporations
Florida's income tax is applicable to subchapter C corporations only, at a rate of 5.5% of the
Florida tax base. The Florida tax base is calculated based upon an allocable portion of the
corporation's Federal income tax base.
Partnerships, S corporations and limited liability companies are exempt unless a Federal
subchapter C corporate election is in place, however, owners of such pass through entities
who are subchapter C corporations are subject to Florida corporate income tax if the pass
through entity does business in Florida or owns property in Florida.
5.2.5 Ad Valorem Property Tax
Unless expressly exempted, all real property and all personal property used for business
purposes in Florida are subject to ad valorem taxation. With limited exceptions, any claim for
exemption must be filed with county property appraiser on or before March 1 of the year.
For further discussion on ad valorem property taxes in the context of real estate transactions,
see Section 9.4.4 of this Guide [Ad Valorem Real Estate Taxes].
5.2.6 Documentary Stamp Tax/Transfer Tax
Excise taxes, commonly referred to as "Stamp Taxes," are imposed on the following:
a. Deeds, instruments, or other writings whereby any real property or any interest
therein is transferred 70¢ on each $100 of consideration therefor ($1.05 on
each $100 in Miami-Dade County). For purposes of computing the
documentary stamp tax, consideration generally includes any debt to which
the real estate is subject. The documentary stamp tax also applies to certain
transfers of interests in legal entities (such as limited liability companies) used
as conduits to transfer Florida real estate;
b. Promissory notes, nonnegotiable notes, written obligations to pay executed or
delivered in Florida and on renewals thereof, 35¢ per $100 of obligation, not
to exceed $2,450 when not secured by a mortgage or security interest filed
or recorded in Florida; and
c. Filed or recorded mortgages, trust deeds, security agreements, or other
evidences of indebtedness and for each renewal of same, stamp tax of 35¢
on each $100 of indebtedness or obligation evidenced thereby. There is no
cap on the documentary stamp tax applied on these instruments. When a
mortgage is recorded, the tax is on the mortgage, not the note.
Mortgages are also subject to an 0.2% assessment of nonrecurring intangible tax.
Apportionment may apply if taxable obligations are also secured by out-of-state real property or
personal property.
For further discussion on Documentary Stamp Taxes in the context of real estate transactions,
see Section 9.4.3 of this Guide [Documentary Stamp Taxes].
5.2.7 Reemployment Tax
Reemployment tax is imposed on each employer (i) which has had in employment at least one
individual for some portion of day in each of 20 different calendar weeks (whether or not
consecutive), in current or preceding calendar year, or (ii) who has paid wages in any calendar
quarter in excess of $1,500 in current or preceding calendar year. The initial rate of employer
contribution is 2.7%, but the experience rating of employer may reduce or increase the rate.
5.2.8 Additional Florida Taxes
The following additional taxes are administered by the Florida Department of Revenue. Specific
information on imposition and rates can be found on the Florida Tax Law Library or by
contacting a Lex Mundi-affiliated Florida tax advisor.
a. Alcoholic Beverage Taxes. State excise tax on malt beverages, wines, and
other alcoholic beverages paid by consumer and collected by manufacturer
or distributor.
b. Cigarette Tax. Imposed at varying rates.
c. Motor Fuel (and diesel fuel) tax per gallon is imposed upon importation of
motor fuels.
d. Aviation fuel tax per gallon is imposed upon importation of aviation fuel.
5.2.9 Taxes Not Imposed
The following taxes are often imposed by other states but are not imposed by the State of
a. Tax Upon Estates of Decedents.
b. Generation-Skipping Transfer Tax.
c. Income Tax. Individuals, S Corporations, Partnership, Trusts and Limited
Liability Companies that are disregarded or taxed as partnerships for Federal
Tax purposes are not subject to income taxes in Florida. However to the
extent that entities which are disregarded or taxed as partnerships for federal
tax purposes have members or partners which are subchapter C
corporations, such members or partners may be subject to Florida corporate
d. Intangible Personal Property Tax.
Labor and Employment
Christopher S. Duke, Esq. | (561) 671-3663 | email@example.com
6.1 Federal Labor and Employment Statutes
6.1.1 Age Discrimination in Employment Act ("ADEA").
The ADEA forbids discrimination based on age in employment decisions. The ADEA applies to
employers engaged in interstate commerce who have 20 or more employees for each working
day in each of 20 or more calendar weeks in the current or preceding calendar year.
6.1.2 Americans with Disabilities Act ("ADA").
The ADA proscribes discrimination in employment based on the existence of a disability.
Furthermore, the Act requires that employers take reasonable steps to accommodate disabled
individuals in the workplace. This Act applies to employers engaged in interstate commerce
who have 15 or more employees for each working day in each of 20 or more calendar weeks
in the current or preceding calendar year.
6.1.3 Employee Polygraph Protection Act ("EPPA").
The EPPA greatly restricts polygraph testing of employees. The EPPA applies to all employers
engaged in interstate commerce. Exempted are employers whose primary business purpose
is running a security service or manufacturing, distributing or dispensing a controlled
6.1.4 Equal Pay Act ("EPA").
The EPA was an amendment to the Fair Labor Standards Act and is designed to promote
equal pay for men and women who do the same jobs. Therefore, if the minimum wage
provision of the FLSA is applicable to one's business, then the EPA is applicable as well.
6.1.5 Fair Labor Standards Act ("FLSA").
The FLSA establishes the minimum wage, overtime and child labor laws for employers
engaged in industries affecting interstate commerce, regardless of the number of employees.
6.1.6 Family and Medical Leave Act ("FMLA").
The FMLA requires that eligible employees be allowed to take up to twelve weeks of unpaid
leave per year for the birth or adoption of a child or the serious health condition of the employee
or the spouse, parent or child of the employee; or because of qualifying exigencies arising out
of a covered family member's call to active duty in the armed forces. The FMLA also requires
that eligible employees be allowed to take up to twenty-six weeks of unpaid leave per year to
care for ill or injured military service members. This Act applies to all employers engaged in
commerce where the employer employs 50 or more employees for each working day during
each of 20 or more calendar weeks in the current or preceding calendar year.
6.1.7 Federal Contractors.
Employers that are federal contractors or subcontractors, depending on the type and size of
their contracts, may have affirmative action obligations under Executive Order 11246 and the
Vocational Rehabilitation Act. Certain federal contractors are also covered by the Drug-Free
Workplace Act.
6.1.8 Other Federal Regulations.
Many employers operate in industries that are regulated by federal agencies. For example, the
Department of Transportation requires employers to drug test employees who drive motor
vehicles of over 26,000 pounds. Employers in regulated industries must be aware of any
requirements imposed by federal or state regulations.
6.1.9 National Labor Relations Act and Labor Management Reporting
and Disclosure Act.
These statutes set forth the guidelines governing labor-management relations. They apply to all
employers who are engaged in any industry in or affecting interstate commerce, regardless of
the number of employees. Employers who operate under the Railway Labor Act are not
subject to these Acts.
6.1.10 Occupational Safety and Health Act ("OSHA").
OSHA is the act that established the mechanism for establishing and enforcing safety
regulations in the workplace. It applies to all employers who are engaged in an industry
affecting commerce, regardless of the number of employees.
6.1.11 Title VII.
Title VII is the broad civil rights statute that forbids discrimination in hiring based on race,
religion, gender and national origin. It applies to employers engaged in interstate commerce
who have 15 or more employees for each working day in each of 20 or more calendar weeks
in the current or preceding calendar year.
6.1.12 Worker Adjustment Retraining and Notification Act ("WARN").
WARN requires employers to give sixty days' notice to their employees of plant closings or
mass layoffs. WARN applies to all businesses that employ 100 or more employees, excluding
part-time employees, and to businesses that employ 100 or more employees who in the
aggregate work at least 4,000 hours per week (exclusive of hours of overtime).
6.1.13 Immigration Reform and Control Act ("IRCA").
IRCA requires that employers verify employment authorization for all employees hired on or after
November 6, 1991. Employers are subject to significant fines and penalties for failure to
comply with documentation requirements under IRCA, as well as for hiring unauthorized
workers or discriminating against persons who appear or sound foreign.
6.2 Federal Employee Benefits Regulations
6.2.1 Employee Retirement Income Security Act of 1974 ("ERISA").
ERISA governs implementation and maintenance of most types of employee benefit plans,
including most retirement programs, life and disability insurance programs, medical
reimbursement plans, healthcare plans, and severance policies. ERISA sets out a detailed
regulatory scheme mandating certain reporting and disclosure requirements, setting forth
fiduciary obligations and, in most types of retirement plans, coverage, vesting and funding
requirements. ERISA generally preempts state laws governing employee plans and
6.2.2 Consolidated Omnibus Budget Reconciliation Act ("COBRA").
COBRA requires employers to make continuing coverage under medical reimbursement and
healthcare plans available to certain terminated employees, at the cost of the employees. The
usual period for which this coverage must be continued is eighteen months. COBRA contains
very specific procedures for notifying terminated employees of their COBRA rights.
6.3 State Labor and Employment Considerations
6.3.1 Florida Civil Rights Act ("FCRA").
FCRA is patterned after Title VII and protects employees against discrimination based on the
same protected status as protected by Title VII, as well as: marital status unless the employer
has instituted an anti-nepotism policy; individuals with AIDS/HIV or who are perceived to have
such conditions; and individuals with sickle-cell traits. Like Title VII, FCRA applies to employers
engaged in interstate commerce who have 15 or more employees for each working day in
each of 20 or more calendar weeks in the current or preceding calendar year.
6.3.2 Florida Minimum Wage Act.
Effective January 1, 2016, Florida's minimum wage is $8.05 per hour. The Florida Minimum
Wage Act applies to all employers who are covered by the FLSA. The Florida Department of
Economic Opportunity is required to calculate a new minimum wage annually and publish the
new minimum wage each January 1.
6.3.3 Whistleblower Laws.
Florida laws prohibit both private sector and public sector employers from discriminating or
retaliating against employees who have objected to the employer's violation or a law, rule, or
regulation; refused to participate in such violations; or threatened to disclose such violations to
a governmental agency. Florida's private sector whistleblower act applies to all private
employers with 10 or more employees. Florida's public sector whistleblower act applies to all
public agencies, regardless of the number of employees.
6.3.4 Florida Worker's Compensation Anti-Retaliation Provision.
This statute prohibits all employers from terminating an employee's employment in retaliation for
filing a worker's compensation claim.
6.3.5 Florida Non-Compete Statute.
Florida's non-compete statute allows for the enforcement of non-compete agreements under
the following circumstances: (1) the agreement must be in writing; (2) the agreement must be
reasonable in time and geographic scope; and (3) the agreement must be reasonably
necessary to protect one or more statutorily-defined legitimate business interests.
Florida courts will presume a restrictive covenant six months or less in duration to be
reasonable and more than two years in duration to be unreasonable unless the restrictive
covenant is applicable to the seller of a business, in which case a duration of less than three
years is presumptively enforceable and greater than seven years is presumptively
Florida courts will presume a restrictive covenant regarding the use and disclosure of trade
secrets five years or less to be reasonable and more than 10 years to be unreasonable,
however, trade secrets may additionally be further protected pursuant to Florida Statutes
Chapter 688 (for further discussion, see Section 7.2.5 of this Guide [State of Florida Uniform
Trade Secrets Act]).
Protected interests under the Florida non-compete statute include, but are not limited to: (1)
trade secrets; (2) valuable confidential business or professional information that otherwise does
not qualify as trade secrets; (3) substantial relationships with specific prospective or existing
customers, patients, or clients; (4) customer, patient, or client goodwill associated with an
ongoing business/practice, a specific geographic area, or a specific marketing/trade area; and
extraordinary or specialized training.
6.3.6 Preservation and Protection of Right to Keep and Bear Arms in
Motor Vehicles Act ("Florida Gun Law").
With limited exceptions, Florida employers may not: (1) prohibit an employee with a concealedcarry
permit from securing a gun in a vehicle in the employer's parking lot; (2) ask an employee
with a concealed carry permit whether he or she has a gun in a vehicle in the parking lot, take
any action against that employee based on statements about whether the employee has a gun
in a vehicle in the parking lot for lawful purposes, or search a vehicle in the parking lot for a gun;
(3) condition employment on whether a person has a concealed-carry permit; or (4) terminate
an employee with a concealed-carry permit, or otherwise discriminate against that employee for
having a gun in a vehicle on the business's property, unless the gun is exhibited on the
property. This law applies to all Florida employers.
Intellectual Property
Michael K. Dixon, Esq. | (561) 671-3621 | firstname.lastname@example.com
7.1 Federal Intellectual Property Law
7.1.1 Copyright Law
This area is governed exclusively by federal law, Title 17, U.S.C.
(a) In General. Copyright law provides the author of a copyrightable work (or such
person's employer in the case of a "work made for hire") with certain specific
exclusive rights to use, distribute, modify and display the work. Generally,
works are entitled to copyright protection for the life of the author plus 70
years. However, as to works made for hire, copyright protection is for the
shorter of 95 years after publication or 120 years after creation. Anyone who
without authority exercises the rights reserved exclusively to the copyright
owner is considered to infringe the copyright and may be liable for actual or
statutory damages and may be subject to injunctive relief.
(b) Copyrightable Works. Works of authorship that qualify for copyright protection
include literary works, musical works (including lyrics), dramatic works,
choreographic works, audiovisual works, pictorial, graphic and sculptural
works, sound recordings and architectural works. The Computer Software
Copyright Act of 1980 expressly made computer software eligible for
copyright protection, a point previously in doubt. The precise scope of
copyright protection for computer software has not yet been fully defined.
Constantly developing technology is likely to present many new issues,
presently unforeseen. All works eligible for copyright protection must meet two
specific requirements. First, the work must be fixed in some tangible form;
there must be a physical embodiment of the work so that the work can be
reproduced or otherwise communicated. Second, the work must be the result
of original and independent authorship. The concept of originality does not
require that the work entail novelty or ingenuity, which are concepts of
importance to patentability.
(c) Advantages of Copyright Registration. Copyright protection automatically
attaches to a work the moment that the work is created. However,
"registration" of the work with the U.S. Copyright Office provides advantages.
A certificate of registration is prima facie evidence of the validity of the
copyright, provided registration occurs not later than five years after first
publication. With respect to works whose country of origin is the U.S.,
registration is a prerequisite to an action for infringement. Registration within
three months after publication or before infringement entitles the copyright
owner to an award of statutory damages and attorney's fees. Otherwise, the
copyright owner is only entitled to damages, not attorney's fees. Registration
also is a useful means of providing actual notice of copyright to those who
search the copyright records.
(d) Copyright Registration Application Process. In order to obtain registration of
copyright, an application for registration must be filed with the U.S. Copyright
Office. The application must be made on the specific form prescribed by the
Register of Copyrights and must include the name and address of the
copyright claimant, the name and nationality of the author, the title of the work,
the year in which creation of the work was completed, and the date and
location of the first publication. In the case of a work made for hire, a
statement to that effect must be included. If the copyright claimant is not the
author, a brief statement regarding how the claimant obtained ownership of
the copyright must be included. An application must be accompanied by the
requisite fee, and a copy of the work must be submitted.
(e) Copyright Notice. Until 1989, all publicly distributed copies of works
protected by copyright and published by the authority of the copyright owner
were required to bear a notice of copyright. A copyright notice is no longer
mandatory, but a copyright notice is still advantageous. For example, the
defense of "innocent infringement" is generally unavailable to an alleged
infringer if a copyright notice is used.
If a copyright notice is used, the notice should be located in such a manner
and location to sufficiently demonstrate the copyright claim. The notice
should consist of three elements. First should be the symbol of an encircled
"C," or the word "copyright," or the abbreviation "copr." Second should be
the year of first publication. Third should be the name of the copyright owner.
(f) Works Made for Hire. In a "work made for hire" the employer is presumed to
be the author. Authorship is significant because a copyright initially vests in
the author. The parties can rebut the presumption of employer authorship by
an express written agreement to the contrary. The term "work made for hire"
applies to any work created by an employee in the course and scope of
employment or a particular work listed at 17 U.S.C. § 101. On occasion
there is dispute as to whether a work created by an employee arose from the
employment. To avoid this issue, employers often require execution of a
formal employment agreement under which the employee expressly agrees
that all copyright rights will belong to the employer. A similar agreement is
also advisable in connection with the engagement of an independent
contractor to perform copyrightable services for a business, but the employer
should be aware that only certain types of works may be considered a "work
made for hire" when created by an independent contractor. If the particular
matter cannot be a "work made for hire," the employer should negotiate an
agreement for the assignment of the copyright by the independent contractor.
(g) Copyright Protection for Foreign Authors. Copyright protection is available
under U.S. law for foreign authors until the copyrightable work is published. If
the work has been published, the availability of continued U.S. copyright
protection is dependent upon the location of the publication and the
nationality or domicile of the author. Copyright protection continues in the
U.S. subsequent to publication if publication by the foreign author occurs in
the U.S., or occurs in a country that is a party to the Universal Copyright
Convention or to the Berne Convention, or occurs in a country named in a
Presidential copyright proclamation. If the work is first published by a foreign
author outside the U.S., continued copyright protection in the U.S. is only
available if the foreign author is either a domiciliary of the U.S. or a national or
domiciliary of a country that is party to a copyright treaty to which the U.S. is
also a party. A person is generally a domiciliary of the country in which the
person resides with the intention to remain permanently.
7.1.2 Patents
This area is governed exclusively by federal law, Title 35, U.S.C., et al.
(a) In General. One who invents or discovers a new machine or device or a new
manufacturing process may be able to obtain a U.S. patent. The U.S. patent
law changed March 16, 2013, from a first-to-invent to a modified firstinventor-
to-file system. It is now imperative that an inventor be the first to file a
patent application in the U.S., and it behooves an inventor to not delay in
seeking U.S. patent protection. A U.S. patent provides the inventor with the
exclusive right for a specified time to exclude others from making, using,
importing, offering to sell, or selling in the U.S. the patented invention. A U.S.
patent does not provide the affirmative right to make, use, import, offer to sell
or sell a patented product. A freedom to operate opinion is often created for
one desiring to assess infringement risks before introducing a product to the
U.S. market. A patent provides the holder with a limited monopoly on the use
of the patented invention. A valid patent forecloses use of the patented
invention by any other party, even if another party independently conceives
the identical invention. A utility patent, which generally governs the functional
aspects of a machine, manufacturing process, or composition of matter is
enforceable beginning at the grant of the patent and ending 20 years (plus up
to 5 more years for certain delays) after the filing date of the regular patent
application. A design patent, which covers the design or appearance of an
article of manufacture, is enforceable for 14 years from the granting date of
the patent. A provisional patent, which may be filed before a utility patent
application, establishes a priority filing date and provides up to 12 months to
further develop the invention without filing a regular patent application.
Anyone without authority from the patent holder who makes, uses, imports, or
sells in the U.S. the patented invention during the life of the patent is
considered to "infringe" the patent and may be liable for damages.
(b) Effect of Foreign Patents. A foreign patent is generally not enforceable in the
U.S. Furthermore, an invention that is the subject of a foreign patent cannot
be the subject of a U.S. patent, unless an application for a U.S. patent is filed
within one year following application of the foreign patent. Accordingly, an
inventor who holds a foreign patent and who fails to apply for a U.S. patent
within one year from the date of application of a foreign patent will usually
have no recourse against others who use the invention in the U.S.
(c) Patentability Under Federal Patent Statutes. To be eligible for a federal utility
patent, an invention must fall into one of the classes of patentable subject
matter set forth in the United States patent statutes. These classes are
machines (e.g., a mechanism with moving parts), articles of manufacture
(e.g., a hand tool), compositions of matter (e.g., a plastic), and processes
(e.g., a method of refining). An improvement falling within any of these
classes may also be patentable. Discoveries falling outside these categories
are not patentable, unless some other statutory provision applies.
In addition to being within one of the four classes and being fully disclosed, a
utility invention must also be:
(i) "novel," in that it was not previously known to or used by others in the
United States or printed or described in a printed publication
anywhere, i.e., disclosed entirely within a single reference document;
(ii) "non-obvious" to a person having ordinary skill in the relevant art, i.e.,
disclosed entirely in parts in two or more reference documents; and
(iii) "useful," in that it has utility, actually works, and is not frivolous or
A design patent may be obtained for the ornamental design of an article of
manufacture. A design patent offers less protection than a utility patent,
because the patent protects only the appearance of an article, and not its
construction or functional aspects of the article.
A plant patent may be obtained by anyone developing a new variety of
asexually reproduced plant, such as a tree or flower. Some plants may also
be protectable with a utility patent or under the Plant Variety Protection Act,
administered by the United States Department of Agriculture.
In order to determine novelty and, hence, patentability of an invention, it is
often useful to search the records of the internet and the U.S. Patent and
Trademark Office. Within the USPTO, one may examine all U.S. patents,
many foreign patents, and a large number of technical publications. A patent
search is customarily performed by a patent attorney or by an individual with
similar technical training, sometimes referred to as a patent agent. A patent
attorney or patent agent may be asked to render an opinion regarding the
patentability of a particular invention. An inventor can then make an informed
decision as to whether to proceed with the cost of an actual patent
(d) Patent Application Process. A U.S. patent application must be filed with the
U.S. Patent and Trademark Office. A complete patent application includes
four elements. First, the application must include the "specification." The
specification is a description of what the invention is and what it does. The
specification can be filed in a foreign language, provided that an English
translation, verified by a certified translator, is filed within a prescribed period.
Second, the application must include an oath or declaration. The oath or
declaration certifies that the inventor believes himself or herself to be the first
and original inventor. If the inventor does not understand English, the oath or
declaration must be in a language that the inventor understands. Third, the
application must include drawings, if essential to an understanding of the
invention. Fourth, the appropriate fee must be included.
After a proper application is filed, the application is assigned to an examiner
with knowledge of the particular subject matter. The examiner makes a
thorough review of the application and conducts a search of existing
concepts in the relevant area to determine whether the invention meets the
requirements of patentability. The examiner will make two determinations of
patentability on the merits of the invention. First, the invention claimed cannot
be disclosed completely within a single prior art document. Second, the
invention cannot be disclosed in part in two or more prior art documents
which would have been obvious to one of ordinary skill in the art. U.S. patent
law was recently updated on March 16, 2013, to expand the definition of prior
art to include all documents "available to the public," including documents in
the U.S. and abroad, and evidence of public use and offers for sale in the
U.S. and abroad. The patent review process generally takes from 18 months
to three years or longer. Rejection of a patent application by the examiner may
be appealed to the Board of Patent Appeals. Decisions of the Board of
Patent Appeals may be appealed to the federal courts. Provisional patent
application requirements are less stringent than a regular patent application.
For instance, the oath or declaration of the inventor and claims are not
required and the application is held for the 12-month period without
(e) Markings. After a patent application has been filed, the product made in
accordance with the invention may be marked with the legend "patent
pending" or "patent applied for." After a patent is issued, products may be
marked "patented" or "pat.," together with the U.S. patent number. Marking is
not required, but it may be necessary to prove marking in order to recover
damages in an infringement action because damages are only recoverable
after a finding of infringement and actual or constructive knowledge of the
patent. The marking requirement may also be met by marking the patented
product with an internet address of a web page that identified the patent
numbers associated with the product.
(f) Rights to Patented Inventions. Disputes sometimes arise between employers
and employees over the rights to inventions made by employees during the
course of employment. Because of this, employers often require employees
to execute formal agreements under which each signing employee agrees
that all rights to any invention made by the employee during the term of
employment will belong to the employer.
7.1.3 Federal Trademarks
This area is governed by both state and federal law.
(a) In General. A trademark is often used by a manufacturer to identify its
merchandise and to distinguish its merchandise from items manufactured by
others. A trademark can be a word, a name, a number, a slogan, a symbol, a
device, or a combination. A trademark should not be confused with a trade
name. Although the same designation may function as both a trademark and
a trade name, a trade name refers to a business title or the name of a
business; a trademark is used to identify the goods manufactured by the
business. A business that sells services rather than goods may also use a
service mark to distinguish its services. Generally, service marks and
trademarks receive the same legal treatment.
(b) Selection of Trademark. A manufacturer should carefully consider the
trademark selected for its merchandise. The level of protection against
infringement of a trademark varies with the "strength" or "uniqueness" of the
trademark. "Descriptive" marks are the weakest and least defensible. A
descriptive trademark is a name that describes some characteristic, function,
or quality of the goods. A "fanciful" mark, the strongest type of mark, is a
coined name that has no dictionary definition. A "generic" word is not
available for protection.
Evaluation should also include consideration of the likelihood of success in
obtaining federal and state registrations of the trademark. For example, a
trademark that is "merely descriptive" cannot be registered under either
federal or Florida law.
Selection of a trademark should be accompanied by a trademark search to
determine whether another manufacturer has already adopted or used a mark
that is the same or similar to the one desired. Publications provide lists of
existing trademarks, registered and unregistered, and there are businesses
that specialize in trademark searches. Actual and potential trademark
conflicts should be avoided, lest the manufacturer become involved in an
expensive infringement lawsuit. Of even greater concern is the potential loss
of the right to use a mark after considerable expenditure in advertising
merchandise bearing the mark.
(c) Advantages of Trademark Registration. Under the trademark laws of the
United States and Florida, the principal method of establishing rights in a
trademark is actual use of the trademark. "Registration" of a trademark is not
legally required but can provide certain advantages.
Federal registration of a trademark is presumptive evidence of the ownership
of the trademark and of the registrant's exclusive right to use of the mark in
interstate commerce, strengthening the registrant's ability to prevail in any
infringement action. Federal registration is also a prerequisite for bringing a
lawsuit under the federal trademark laws, for an award of attorney's fees and
for an award of statutory damages.
After five years of continued use of the mark following federal registration, the
registrant's exclusive right to use of the trademark becomes virtually
conclusive upon filing a statement. Federal registration may assist in
preventing the importation into the U.S. of foreign goods that bear an
infringing trademark. There are also other less tangible advantages of
registration, such as the goodwill arising out of the implication of government
approval of the trademark.
State registration provides some advantages, though these advantages are
not quite as extensive as federal registration. State registration is usually
advisable, particularly in situations in which a manufacturer's sales will occur
only in Florida.
(d) Federal Registration Application Process. 15 U.S.C. § 1051, et seq. Federal
trademark registration requires that a trademark application be filed with the
U.S. Patent and Trademark Office. The application must identify the mark and
the goods with which the mark is used or is proposed to be used, the date of
first use, and the manner in which it is used. The application must be
accompanied by payment of the requisite fee, a drawing page depicting the
mark, and three specimens of the mark as it is actually used. After the
application is filed, it is reviewed by an Examining Attorney who evaluates,
among other matters, the substantive ability of the mark to serve as a valid
mark and the possibility of confusion with existing marks. If the examiner
rejects the application, the examiner's decision can be appealed to the
Trademark Trial and Appeals Board. An adverse decision by that body can be
appealed to federal court.
If the application is approved, the mark is published in an official publication of
the Patent and Trademark Office. Opponents of the registration have 30 days
after publication, or such additional time as may be granted, to challenge the
registration. If no opposition is raised, or if the opponent's claims are rejected,
an applicant whose mark is already in use receives a "certificate of
An applicant whose trademark is proposed for registration before actual use
receives, upon approval of the application, a "notice of allowance." An
application who receives a notice of allowance must within six months of the
receipt of the notice furnish evidence of the actual use of the trademark. The
applicant then is entitled to a certificate of registration. Failure to furnish
evidence of the actual use of the mark within the time allowed results in
rejection of the application. The time period for proving actual use can be
extended for up to three years.
(e) Post-Certificate Federal Procedures. A certificate of trademark registration
issued by the Patent and Trademark Office remains in effect for 10 years.
However, registration expires at the end of six years, unless the registrant
furnishes evidence of continued use of the trademark. The initial 10-year term
of a certificate of registration can be renewed within the term's last six months
for an additional 10-year term by furnishing evidence of continued use of the
mark and paying a fee.
After at least five years of continuous use of a trademark following the receipt
of a certificate of registration, a registrant can seek to have the status of the
trademark elevated from "presumptive" evidence of the registrant's exclusive
right to use of the trademark to virtually conclusive evidence of an exclusive
right. To do so, the registrant must furnish the Patent and Trademark Office
with evidence of continuous use of the trademark for at least five years.
Additionally, there must not be any outstanding lawsuit or claim that
challenges the registrant's rights to use the mark.
7.2 State Intellectual Property Considerations
7.2.1 Patents
This area is governed exclusively by federal law, Title 35, U.S.C. et al.
7.2.2 Copyright Law
This area is governed exclusively by federal law, Title 17, U.S.C.
7.2.3 State of Florida Trademarks
This area is governed by state law, Florida Statutes, Title XXXIII, Chapter 495, and federal law.
(a) In General. A trademark is often used by a manufacturer to identify its
merchandise and to distinguish its merchandise from items manufactured by
others. A Florida trademark can be a word, name, symbol, or device or any
combination thereof used by a person to identify and distinguish the goods or
services of such person, including a unique product, from those
manufactured or sold by others, and to indicate the source of the goods,
even if unknown.
A business that sells services rather than goods may also use a service mark
to distinguish its services. Generally, service marks and trademarks receive
the same legal treatment. Common law rights in marks used, but not
registered, are preserved by Florida statute.
(b) Selection of Trademark. See discussion above under Section 7.1.3.(b).
(c) Advantages of Trademark Registration. Under the trademark laws of Florida,
the principal method of establishing rights in a trademark is actual use of the
trademark. "Registration" of a trademark is not legally required but can
provide certain advantages over federal registration. In particular, an owner of
a trademark registered in Florida may receive attorney's fees if successful in a
trademark infringement action "according to the circumstances of the case"
as determined by the court. Such threshold is a lower than the federal U.S.
standard of an "exceptional case" in the Lanham Act. Additionally, the court
has discretion to award damages up to three times actual damages and, if
the amount based on profits is inadequate or excessive, the court may award
damages "according to the circumstance of the case." Thus, much latitude is
available to the court.
(d) State Registration Application Process. An application for registration to the
State of Florida may be made by any individual, firm, partnership, corporation,
union, association, or other organization. Applications for Florida trademarks
are submitted to the Florida Department of State, Division of Corporations (the
"Department"), using the required application form available on the
Department's website. The application must identify the name and business
address of the person applying for such registration, the mark and the goods
with which the mark is used or is proposed to be used, the date of first use
when the goods are sold or transported in Florida, and the manner in which it
is used. The application must also include a statement that the applicant is
the owner of the mark, that the mark is in use, and that, to the best of the
applicant's knowledge, no other person except a related company has
registered such mark in this state, or has the right to use such mark in this
state, either in the identical form thereof or in such near resemblance thereto
as to be likely, when applied to the goods or services of such other person, to
cause confusion, to cause mistake, or to deceive. The application must be
accompanied by payment of the requisite fee, a drawing page depicting the
mark, and three specimens of the mark as it is actually used. After the
application is filed, it is reviewed. The application may be amended by the
Department upon agreement from the applicant, within three months of the
request for amendment. Upon compliance, the Department shall issue a
"certificate of registration" to the applicant.
(e) Post-Certificate State Procedures. A certificate of registration issued by the
state of Florida remains in effect for five years. The initial five-year term of a
certificate of registration can be renewed within the term's last six months for
an additional five-year term by furnishing evidence of continued use of the
mark, a verified statement that the mark is still in use in the State of Florida or
a statement that its nonuse is due to special circumstances that excuse its
nonuse, and payment of a fee.
A trademark registered in the state of Florida may be canceled by the
department upon receipt of a voluntary request; nonrenewal; upon a finding
by a court of abandonment, that the registrant is not the owner, that the
registration was granted improperly, that the mark was obtained fraudulently,
or that the mark has become generic; or when a court orders cancellation of
the mark on any ground.
(f) Infringement. On behalf of the owner of a mark, a court may enjoin the
manufacture, use, display, or sale of any counterfeits or imitations thereof,
require forfeiture of profits derived from wrongful display, manufacture, use, or
sale and to pay costs of the action, and may order seizure of counterfeit
goods under the control of the defendant.
(g) Dilution. The owner of a mark that is famous in the state of Florida is entitled
to an injunction and other relief against another person's commercial use of a
mark or trade name if such use begins after the mark has become famous
and is likely to dilute the distinctive qualities of the famous mark. Factors used
to determine whether a mark is famous are stated at Florida Statutes §
7.2.4 State of Florida Deceptive and Unfair Trade Practices Act
The State of Florida Deceptive and Unfair Trade Practices Act, Chapter 501.200, et al., makes
unlawful unfair methods of competition, unconscionable acts or practices, and unfair or
deceptive acts or practices in the conduct of any trade or commerce and makes state
consumer protection in Florida consistent with federal consumer protections.
7.2.5 State of Florida Uniform Trade Secrets Act
The State of Florida Uniform Trade Secrets Act, Chapter 688, et al., makes unlawful actual or
threatened misappropriations of trade secrets. A trade secret is defined as information,
including a formula, pattern, compilation, program, device, method, technique, or process that
derives independent economic value, actual or potential, from not being generally known to or
accessible by other persons who can obtain economic value from its disclosure or use and is
information that is the subject of efforts to maintain its secrecy. An action for misappropriation
of trade secrets must be brought within three years after the misappropriation is discovered or,
by exercise of reasonable diligence, should have been discovered. A complainant may recover
damages for actual loss and unjust enrichment caused by the misappropriation that is not
accounted for in the actual loss analysis. Attorney's fees are available if a claim of
misappropriation is made in bad faith, a motion to terminate an injunction is made in bad faith,
or willful and malicious misappropriation exists.
Commercial Banking Opportunities
Virginia B. Townes, Esq. | (407) 419-8513 | firstname.lastname@example.com
Commercial Banking Opportunities
Florida is served by more than 300 banks, including the largest nationally chartered banks and credit
unions, regional institutions and local community banks. Florida's economy has historically been based
on real estate development and the tourist economy. However, the number and quality of institutions of
higher learning in the state are also creating financing opportunities for innovation technology and
Florida does not require out-of-state financial institutions to become authorized to do business in Florida
in order to extend credit into Florida from outside of the state. Out-of-state banks can establish de novo
(new) branches without Florida authorization. However, branching through acquisition of a Floridachartered
bank requires regulatory approval of that acquisition.
Florida chartered banks are regulated through the Office of Financial Regulation, a division of the
Financial Services Commission which is comprised of the members of the Florida cabinet. Bank
holding companies doing business in the state through affiliates are required to be registered to do
business in the state through the Secretary of State, Division of Corporations.
Florida's climate and its position as a gateway to Latin America attract enterprise from across the
country. A large number of regional banks have followed their customers to Florida, establishing
branches across the state. The influx of a retirement population with ties to out-of-state banks has also
spurred banking migration to Florida. At the same time, a number of Florida-originated banks have, by
merger and acquisition, become part of major national banks while retaining their Florida connections to
business development.
Florida's geographic position has made it a destination for South and Central American business as well
as a growing expatriate community. Miami is reported to host more international financial institutions
than any U.S. city other than New York. Miami's connection to Latin America has attracted foreign
financial institutions from England, Germany, Israel, and South Africa, to name only a few countries.
Florida also has an active and growing expatriate community which has also attracted a number of
international financial institutions and international money services businesses.
Real Estate Transactions
Jarrett D. Bingemann, Esq. | (407) 419-8551 | firstname.lastname@example.com
A. Carter Downs, Esq. | (407) 419-8580 | firstname.lastname@example.com
The Foreclosure Process
Megan C. DeVault, Esq. | (407) 419-8513 | firstname.lastname@example.com
Joseph E. Foster, Esq. | (407) 419-8511 | firstname.lastname@example.com
Ginnette Childs, Esq. | (407) 419-8592 | firstname.lastname@example.com
Easements and Land Use and Zoning
Cecelia Bonifay, Esq. | (407) 419-8540 | email@example.com
Valerie J. Hubbard | (850) 521-8003 | email@example.com
Eminent Domain
George W. Powell, Esq. | (305) 982-5587 | firstname.lastname@example.com
9.1 Ownership and Title
The grantee in a deed of land must generally be a person, natural or artificial, in existence at the time of
the conveyance, and legally capable of accepting the deed and holding title to real property. See
Tucker v. Cole, 3 So.2d 875 (1941). A deed from an owner of real property to a nonexistent entity is a
nullity. See Belcher Center LLC v. Belcher Center, Inc., 883 So.2d 338 (Fla. 2d DCA 2004) and
citations therein.
An individual generally must be at least 18 years of age (Florida Statutes § 743.07) and mentally
competent / not under a mental disability to hold title to real property in Florida. An individual is not
required to be a resident of the United States to hold title in Florida; however, the conveyance of real
property by non-citizens generally may create certain non-Florida specific issues, specifically with
respect to taxation. For example, the Foreign Investment in Real Property Tax Act, codified at 26 U.S.C.
§§ 1445, imposes income tax on foreign persons disposing of United States real property interests.
Further, Florida law provides significant protections for homestead properties related to certain liens of
creditors, devise and descent of the homestead property, and transfers or encumbrances by spouses
without the joinder of the other spouse. See FLA. CONST. art. VII, § 6(a); FLA CONST. art. X, §§ 4(a)(1) &
A domestic business entity may generally acquire, hold title to, and convey real property in Florida if
authorized, current, and in accordance with its applicable governing documents, as more specifically set
forth within the applicable provisions of Chapters 607 (corporations), 608 (limited liability companies),
617 (corporations not for profit), and 620 (partnerships), Florida Statutes. Each of the respective entities
provides certain liability shields that would impact liabilities arising from the ownership of real property.
Similarly, a foreign business entity may generally acquire, hold title to, and convey real property in Florida
if authorized, current, and in accordance with its applicable governing documents. In addition, a foreign
business entity generally does not need to be registered in Florida to merely hold title or enforce rights in
real property. See Batavia, Ltd. v. U.S. By and Through Dept. of Treasury, Internal Revenue Service,
393 So.2d 1207, 1208 (Fla. 1st DCA 1980). However, foreign entities should review the requirements
for registering with the Florida Secretary of State Division of Corporations if planning to manage real
property, develop real property, or engage in similar real estate activities in Florida.
In addition, Chapter 692, Florida Statutes, sets forth certain additional statutory requirements concerning
the conveyance of real property by or to particular entities (both domestic and foreign) in Florida.
9.2 Concurrent Ownership
9.2.1 Tenancy in Common
Under Florida law, except in the case of a tenancy by the entireties (discussed below), a
conveyance to two or more persons creates a tenancy in common unless the instrument
creating the estate expressly provides for the right of survivorship. In a tenancy in common,
each cotenant owns an undivided interest and possessory right in and to the real property.
Possession is the only unity necessary for a tenancy in common. Each cotenant has a separate
estate that is freely alienable, can be attached by creditors, is descendible to heirs, and is
devisable by will. Unless otherwise agreed to by the cotenants, each cotenant is generally liable
for its proportionate share of the obligations arising from ownership of the real property, even if
only one cotenant is in possession of the property. A cotenant in possession of the property
may generally seek contribution from the other cotenants regarding payment of the
proportionate expenses. Unless otherwise agreed to by the cotenants, all rents and profits
received concerning the real property are generally to be proportionately shared by all
cotenants. Any cotenant may file an action to partition such cotenant's common interest in the
real property.
9.2.2 Joint Tenancy with Rights of Survivorship
Under Florida law, except in the case of a tenancy by the entireties (discussed below), the
instrument of conveyance must provide for right of survivorship for a joint tenancy to be
created. Otherwise, the tenants will be tenants in common. Each joint tenant owns an
undivided interest and possessory right in and to the real property. The unities required for
creation of a joint tenancy in Florida are (a) unity of time; (b) unity of title; (c) unity of possession;
and (d) unity of interest. In the event of death of a joint tenant, the real property passes by
operation of law to the surviving joint tenant. Each joint tenant has a separate estate that is
freely alienable and attachable by creditors. A joint tenant may mortgage its interest in the real
property. A joint tenancy is converted to a tenancy in common when a joint tenant conveys its
undivided interest in the property to another person. Any joint tenant may file an action to
partition such joint tenant's interest in the real property.
9.2.3 Tenancies by the Entireties
Only a married couple may own real property as tenants by the entireties. A conveyance of real
property to a married individual is presumed to create a tenancy by the entireties. A tenancy by
the entireties is a joint tenancy with a fifth unity, the marriage of the parties. Unlike a joint
tenancy, a tenancy by entireties includes a right of survivorship regardless of whether the
conveying instrument establishes such right, i.e., as long as the five unities are present, there is
a right of survivorship. Unlike a joint tenancy, a tenancy by the entireties may not be terminated
by one spouse without the other spouse's consent. In addition, neither spouse can sell,
mortgage, or encumber the real property without the other spouse's consent. Creditors
generally cannot attach property held in tenancy by the entireties unless such creditors are joint
creditors of both spouses. A tenancy by the entireties automatically terminates and becomes a
tenancy in common upon dissolution of the marriage.
9.3 Spousal Rights in Real Estate
9.3.1 General Rule: Spouses Deemed to Take Title as Tenants by the
In Florida, a conveyance of real property to persons who are married is deemed to create a
tenancy by the entireties, unless a contrary intention is clearly shown in the deed of
conveyance. This is true whether or not the persons are stated to be married in the deed itself.
Spouses may elect to own property as tenants in common, if they wish to do so, and if the
intention is clearly stated in the deed of conveyance.
An individual who owns real property may subsequently create a tenancy by the entireties in
that property with his/her spouse. The creation of an estate by the entireties can be
accomplished by conveyance to one spouse, with a statement in the deed that the transaction
is intended to create a tenancy by the entireties, or by a conveyance to both spouses. If the
property is subject to a mortgage, consent of the mortgagee may be required for such a
conveyance. In addition, such a conveyance may trigger documentary stamp tax
According to Florida Statutes § 689.11, interspousal conveyances of property, including
homestead property, no longer require spousal joinder. For instance, one spouse may convey
to the other his/her interest in property, whether or not homestead, without joinder of the
transferee spouse.
An individual who owns real property at the time of marriage continues to own that property,
subject only to homestead rights of his/her new spouse, if the property constitutes homestead
property. If the property is not homestead property, the spouse does not acquire an interest in
the real estate by virtue of a subsequent marriage, and the new spouse is not required to join in
any mortgage or conveyance.
For so long as an interest in real property is vested in husband and wife as tenants by the
entireties, a judgment against one spouse will not attach to the property. If property is owned
as tenants by the entireties, neither spouse, acting alone, may convey any interest in the
property or mortgage or otherwise encumber the property. Any conveyance or mortgage of
property owned by the entireties should be by means of one instrument executed by both
spouses. It is possible that separate deeds or mortgages, each executed by one spouse,
could be collectively construed as one instrument of conveyance or mortgaging, but such
construction might require judicial intervention.
9.3.2 Dissolution or Death
Upon dissolution of a marriage, persons who formerly owned property as tenants by the
entireties shall thereafter be deemed to own the property as tenants in common, as of the time
the judgment of dissolution becomes final, in accordance with Florida Statutes, § 689.15,
unless the judgment dissolving the marriage specifically provides otherwise.
If property is owned as tenants by the entireties, upon the death of one spouse, title
automatically vests in the surviving spouse, so long as the spouses remained continuously
married during their ownership of the property. This is true whether or not the property was
homestead property. Although it is sometimes requested or required, by a title insurance
company or other party, that an affidavit of continuous marriage be recorded, it is presumed, in
absence of evidence to the contrary, that a marriage is continuous from the date of its
9.3.3 Alienation of Homestead Property
If record title to homestead property is vested in one married person, the spouse must join in
any mortgage, encumbrance, or conveyance of that property. However, in the absence of
spousal joinder, Florida courts may nonetheless impose a constructive trust or equitable lien on
the property in favor of a creditor where the mortgage is obtained by fraud and the subject
funds are used to acquire or improve homestead property. See, e.g., Hirchert Family Trust v.
Hirchert, 65 So.3d 548 (Fla. 5th DCA 2011).
If record title to homestead property is vested in one married person, upon the death of that
person, title vests in the surviving spouse if there are no lineal descendants. If there are lineal
descendants, the surviving spouse takes a life estate, and a vested remainder vests in the
lineal descendants. For surviving spouses who cannot afford / are not willing to assume the
burdens associated with a life estate, Florida Statutes § 732.401(2) allows the spouse to forgo
his/her rights to a life estate and instead take an undivided one-half in interest in the property,
with the other half passing to any lineal descendants, per stirpes. Such election is irrevocable
once made.
9.4 Purchase and Sale of Property
9.4.1 Purchase Agreements
In Florida, there is no general presumption that the initial purchase agreement is to be prepared
by seller or purchaser. Many commercial transactions begin with a non-binding letter of intent
and the parties then negotiate who will prepare the initial purchase agreement. In residential
transactions, it is common but not required that the purchaser will submit an initial purchase
agreement to the seller for the seller's review.
Essential elements of a real estate purchase agreement under Florida law are: (a) identity of the
seller and purchaser, (b) the amount of consideration to be paid, and (c) an adequate
description of the subject real property. A description of the subject real property is considered
adequate if a land surveyor can locate the real property using such surveyor's professional
training and tools. To comply with the Statute of Frauds, Florida Statutes § 689.01, a contract
to sell real property in Florida must be in writing, signed by the party to be changed and be
definite in its term without the use of parol evidence. Other typical provisions in a commercial
transaction may include deposit requirements; due diligence/inspection periods; title insurance
and survey review/objection periods; representations and warranties; conditions precedent to
closing; establishment of the closing date; the documents necessary for closing; required title
insurance; the allocation of responsibilities for payment of title insurance premiums,
documentary stamp taxes, and other closing costs and expenses; prorations of ad valorem real
estate taxes; time of the essence; default/remedy/specific performance provisions; grounds for
termination of the purchase agreement; non-jury trial and venue provisions; merger and
integration clauses; financing contingencies (if applicable); and provisions dealing with the
recording/non-recording of the purchase agreement or a memorandum thereof in the public
9.4.2 Protection Against Fraud
While there are a number of statutory consumer protection disclosures required (particularly
with regard to the sale of residential properties) which are beyond the scope of the general
summary set forth in this Guide, fraud in connection with the sale and purchase of real property
is generally governed by Florida common law. In commercial real estate transactions, Florida
case law holds that the doctrine of caveat emptor generally applies, i.e., the seller of
commercial real property generally does not have to disclose known facts materially affecting
the value of the property. In residential transactions, Florida case law holds that sellers of real
property are required to disclose facts materially affecting the value of the property. Florida
recognizes the torts of fraudulent misrepresentation and negligent representation, both of which
have been successfully used by aggrieved purchasers of real estate.
9.4.3 Documentary Stamp Taxes
The Florida documentary stamp tax is due on all deeds transferring Florida real property for
monetary consideration or any other consideration that has a reasonably determinable
pecuniary value. The current documentary stamp tax rate on deeds is $.70 cents per $100.00
of the consideration, or any fraction thereof, in all Florida counties except Miami-Dade County,
where the rate is $.60 cents per $100.00, plus the Miami-Dade County local-option surtax of
$.45 cents, which typically only applies to properties other than single-family residences.
Payment of documentary stamp taxes on deeds in residential transactions is customarily the
seller's responsibility and may be subject to negotiation in commercial transactions.
Additionally, the Florida documentary stamp tax is due on promissory notes or other obligations
for indebtedness. See infra, Section 9.4.5(c) and (d).
9.4.4 Ad Valorem Real Estate Taxes
Ad valorem real estate taxes are billed in arrears on a calendar year basis. Such taxes are billed
in November of each year and due by March 31st of the following year, with the following
discounts for early payment: a 4% discount if paid in November, a 3% discount if paid in
December, a 2% discount if paid in January, and a 1% discount if paid in February. Taxes are
delinquent on April 1st. It is customary for ad valorem real estate taxes to be prorated at the real
estate closing based on the prior calendar year's tax amount (fully discounted) if the closing
takes place prior to when the actual tax amount for the current calendar year is known. In such
instance, frequently the purchase agreement provides that the tax prorations will be adjusted
when the actual taxes are known at the request of either party. Alternatively, the purchase
agreement may state that the tax prorations are final.
9.4.5 Closing
(a) Deed. There are generally four types of deeds from which the parties may
chose: (a) statutory warranty deed, (b) warranty deed, (c) special warranty
deed, and (d) quit claim deed. A statutory warranty deed coveys good title
with the present covenants of seisin and the covenant against
encumbrances, and the future covenants of further assurances and quiet title.
A warranty deed should provide the same warranties and covenants as a
statutory warranty deed. The form of warranty deed, special warranty deed,
and quit claim deed have not been adopted by statute, but custom and time
have resulted in some generally accepted forms. In contrast to a statutory
warranty deed or a warranty deed, a special warranty deed covenants only to
protect grantees from the claims of others specifically claiming through the
grantor. A special warranty deed is akin to a covenant deed in some other
jurisdictions. A quit claim deed generally does not contain any of the
traditional covenants or warranties of title, and is often granted to clear title
defects, in lieu of foreclosure, or in connection with the winding down of the
affairs of a dissolved entity. All deeds must be executed in front of two
subscribing witnesses and a notary public. Unlike some states, there is no per
se prohibition in Florida against insuring a quitclaim deed; however, insuring a
quit claim deed may require additional examination and approvals by the
respective title insurer.
(b) Bill of Sale. If personal property is being transferred with commercial real
property, then a bill of sale is customarily delivered. A bill of sale may be in the
form of a quitclaim bill of sale or may contain such representations and
warranties as the parties negotiate. For purposes of payment of documentary
stamp taxes, if the subject transaction includes both real property and
tangible personal property, then the purchase price may be allocated
between the real property, which is subject to the documentary stamp tax,
and the tangible personal property, which is not subject to the documentary
stamp tax. It is important to note that the Florida Department of Revenue has
rules for such apportionment. In addition, if the purchase price is allocated
between the real property and the tangible personal property, it is possible
that such allocation may trigger sales tax due on the personal property. There
are Florida Department of Revenue rules and Technical Assistance
Advisements to assist in such a determination.
(c) Mortgage. There is no statutory form of mortgage in Florida. The general
requirements for a mortgage under Florida law are the intent of the mortgagor
to mortgage the real property, consideration, an adequate description of the
real property, a statement of the mortgagor's obligation, and delivery and
acceptance of the mortgagee. In Florida, a mortgage is a lien, not an interest
in real property. Therefore, witnesses are not an essential element of a
mortgage. A mortgage is perfected by the recording of the instrument in the
public records of the county in which the mortgaged real property is located.
The recording of a mortgage provides constructive notice to all creditors and
bona fide purchasers. Acknowledgement of a mortgage is required to comply
with the recording statute. With proper language, a mortgage may also serve
as a security agreement, a fixture filing, and as an assignment of leases and
rents. The Florida documentary stamp tax is due on all notes or other
obligations to pay debt secured by mortgages recorded in the State of Florida
at the rate of $.35 cents on each $100.00 or fraction thereof of the
indebtedness or obligation evidenced thereby. There is no limit on the
documentary stamp tax due for mortgages or liens filed or recorded in Florida.
Certain mortgages, characterized by statute as balloon mortgages, i.e., if the
final payment of principal due and payable on maturity is greater than twice
the amount of regular or periodic payment of the mortgage, that do not fall
under a statutory exemption, must contain a statutory disclosure of their
status as a balloon mortgage.
(d) Financing. In Florida, common law governs most elements of commercial real
estate financing transactions. Most complex real estate financing transactions
are initially documented by a loan commitment followed by a formal loan
agreement between the borrower and the lender. In addition to a mortgage,
most lenders in Florida also require a separate collateral assignment of leases
and rents, which is recorded in the public records of the county in which the
subject property is located. With proper language, the mortgage can also
serve as an assignment of leases and rents. Florida has a statute governing
certain aspects of collateral assignments of leases and rents. If the borrower
is not creditworthy, then a lender may require a guaranty instrument from a
creditworthy entity.
The typical document to evidence a borrower's repayment obligation in Florida
is a promissory note. There is no statutorily promulgated form of promissory
note in Florida. The general requirements for a promissory note under Florida
law are that the instrument must contain a promise to repay a fixed amount of
money, must be payable on demand or at a time certain, and must be signed
by the borrower or maker. Promissory notes may be negotiable or nonnegotiable
instruments. Subject to a statutory cap of $2,450.00, the Florida
documentary stamp tax is generally due on all promissory notes,
nonnegotiable notes, and written obligations at the rate of $.35 cents on each
$100 or fraction thereof of the indebtedness or obligation evidenced thereby.
Promissory notes secured by a mortgage are generally subject to the Florida
non-recurring intangible tax at the rate of $0.002 for every $1.00 paid at the
time the lien upon the subject real property was created.
With some specific modifications, Florida has adopted Article 9 of the Uniform
Commercial Code. Financing statements are filed with the Florida Secured
Transaction Registry.
(e) Closing Statement. Closing statements are customarily used in all real estate
and real estate financing transactions in Florida. They are typically prepared by
the transaction's closing agent. If the transaction involves the financed
acquisition of property, then typically there will be one closing statement for
the loan transaction and another closing statement for the real estate
transaction. Aside from the purchase price or loan amount, other items
typically included on a closing statement are, as applicable, prorations and
payment of taxes and other expenses, payment of title insurance premiums
and endorsements, payment of documentary stamp taxes and nonrecurring
intangible taxes, and payment of attorney fees, on a case-by-case basis.
9.5 Leasing
Leases for more than one (1) year must satisfy the requirements of the Florida conveyancing (i.e.,
statute of frauds) statute (Florida Statutes § 689.01), meaning they must be executed before two
witnesses. Further, purchasers of real property who have constructive notice of a lease on the subject
real property generally risk taking title subject to the respective lease. See, e.g., Ruotal Corp., N. W. v.
Ottati, 391 So. 2d 308, 309 (Fla. 4th DCA 1980). In addition, the recording of a lease generally
constitutes constructive notice of a lease encumbering real property (see Florida Statutes § 695.01).
9.5.1 Residential
Residential tenancies in Florida are generally governed by the Florida Residential Landlord
Tenant Act, Chapter 83, Part II (§§ 83.40-83.682), Florida Statutes, and common law. The
Florida Residential Landlord Tenant Act imposes duties both on the landlord and tenant;
provides for the termination of a lease and removal of a tenant; provides conditions for holding
and returning security deposits; and sets forth a number of rules that alter common law.
Certain residential tenancies are not covered by the Florida Residential Landlord Tenant Act,
including: (a) residency or detention in any facility incidental to receiving health, educational,
counseling, religious, or similar services; (b) occupancy under a contract of sale of a dwelling
unit or the property which it is a part; (c) transient occupancy in a public lodging or mobile
home park; (d) occupancy by a lessee of a proprietary lease in a cooperative apartment or by
an owner in a condominium unit. Further, in certain tenancies, such as rentals of single homes
or duplexes, statutory provisions may be altered by written contract.
9.5.2 Commercial
Commercial tenancies in Florida are generally governed by Chapter 83, Part I (§§ 83.001-
83.251), Florida Statutes, and common law. Further, Florida sales tax is due on the total rent
paid for the right to use or occupy commercial real property (including rents as well as
payments made by a tenant on behalf of the landlord such as ad valorem taxes, insurance,
etc.), unless the rent falls within certain exemptions. Without limitation, rentals, leases, and
licenses to use or occupy real property by related "persons" as defined in § 212.02(12), Florida
Statutes, (including, but not limited to, a parent corporation to subsidiaries and
individual/shareholder to a corporation) are also subject to sales tax.
9.6 The Foreclosure Process
Unlike most states, Florida does not allow non-judicial mortgage foreclosures. All mortgage foreclosures
in Florida must be filed and prosecuted as civil law suits, usually in Florida's Circuit Courts, which are the
state trial courts with general jurisdiction over disputes where the amount in controversy exceeds
$15,000.00. However, if the requisites for diversity jurisdiction and amount in controversy are present, a
mortgage foreclosure may be prosecuted in federal district court. In general, a mortgage foreclosure
action is treated no differently than any other type of civil suit. Because of this, mortgage foreclosure
actions are subject to the same rules governing discovery, including depositions, that apply to all other
civil actions in Florida. Parties to a foreclosure action are also subject to normal motion practice,
affirmative defenses, counterclaims, trial and appeals as could be expected in other civil actions. A
hotly contested mortgage foreclosure in Florida can take more than a year to resolve, not including any
subsequent appeal.
The plaintiff in a Florida mortgage foreclosure is the owner and holder, or the non-owner holder with
rights of enforcement, of the mortgage and the underlying promissory note or other debt obligation
secured by the mortgage. The identities of the defendants to the suit are usually determined by a title
search, typically called a foreclosure title commitment, obtained from a title insurance agency. The
commitment identifies many of the parties required to be named as defendants in the foreclosure suit,
which include the owner(s) of the property, the borrower(s), if different from the owner(s), any guarantors,
all junior lienholders, and those tenants whose leasehold or possessory interests arose after the
mortgage and whose leasehold or possessory interests the plaintiff wishes to eliminate. If the identified
defendants are named and served and the foreclosure is prosecuted to judgment in accordance with
Florida law, the title insurance company providing the commitment will then issue an owner's title policy
to the plaintiff if the plaintiff, or plaintiff's assignee, is the winning bidder at the foreclosure sale.
Once the suit is filed, it is prosecuted to judgment in the normal fashion of any other Florida law suit.
That is, the judgment is obtained either after a trial, after a hearing on a motion for summary or default
judgment, or via a stipulation by the defendant(s). In addition to the standard procedure, plaintiffs in a
mortgage foreclosure action can also avail themselves of the summary "show cause" foreclosure
procedure prescribed by § 702.10, Florida Statutes. If successful, this summary procedure results in a
final judgment of foreclosure being entered much more rapidly than is customary in a typical Florida civil
suit. In a show cause foreclosure, it is possible for title to be issued within 90 to 120 days after the
mortgage foreclosure suit is filed. However, the Florida Legislature made recent changes to the show
cause procedure, and as of the date of this Guide, case law is still being decided that makes it unclear
how these new procedural modifications will impact the show cause timeline. The recent changes are
discussed in more detail in Section 4.6.1 below, however, participants in a foreclosure suit are urged to
contact a Lex Mundi-affiliated advisor for specific advice on the procedures of foreclosure actions.
Simultaneously with the filing of the foreclosure action, the plaintiff should record a notice of lis pendens
in the public records of the county or counties in which the real property is located. Any interest arising
after the recording of the lis pendens, whether recorded or unrecorded, is automatically foreclosed
unless the party asserting the interest affirmatively intervenes in the pending foreclosure suit within 30
days of the recording of the notice of lis pendens.
Once the suit is prosecuted to conclusion, either by trial, settlement, motion for default or summary
judgment, or through the use of the show cause procedure under § 702.10, Florida Statutes, the final
judgment of foreclosure is entered. A typical foreclosure judgment: (a) determines plaintiff's entitlement
to be paid on the underlying indebtedness, (b) determines the amount of that indebtedness, including
principal, interest, costs, attorneys' fees, prepayment penalties, late fees, premiums, taxes, etc., (c)
forecloses the interests of the owner(s), borrower(s), all junior lienholders, those tenants who have been
properly named as defendants, and those non-intervenors whose interests arose after the recording of
the notice of lis pendens, (d) sets the foreclosure sale date, (e) directs the Clerk of the Court on the
distribution of any excess sale proceeds, (f) may provide the Clerk with specific sale conduct
instructions not already provided by Florida's judicial sale statute, § 45.031, Florida Statutes, (g) may set
a redemption deadline different from that established by § 45.0315, Florida Statutes, and (h) reserves
jurisdiction to award appropriate future relief, such as writs of possession, deficiency judgments, and, if
necessary, judgments of reforeclosure.
The date, time and place of the foreclosure sale are generally set in the final judgment of foreclosure.
Thereafter, a Notice of Sale is published once a week for two consecutive weeks in a general circulation
periodical in the county or counties in which the real property is located. The last publication of the
Notice of Sale must be at least five days before the foreclosure sale. Foreclosure sales are generally
conducted as public auctions and in accordance with Florida's judicial sale statute, § 45.031, Florida
Statutes. In a few counties, the foreclosure sale is a live auction held at the County Courthouse and
conducted by a Clerk of the Court. However, in most counties, the sale is an on-line auction with all
bidders required to register in advance. At the foreclosure sale, the plaintiff is entitled to bid on credit up
to the full amount of the judgment, plus post-judgment interest which has accrued up to the date of the
sale. On the other hand, non-plaintiff bidders are required to deposit with the Clerk of the Court 5% of
the winning bid immediately upon the close of bidding in those counties conducting live auctions. In online
auction counties, non-plaintiff bidders must deposit 5% of their registered maximum bid with the
Clerk of the Court immediately upon registration. Most Clerks also require non-plaintiff bidders to pay
the remaining 95% of the bid amount in cash or cashier's check later that same day, or by the end of
the next business day. In addition to the prompt payment of the winning bid, the winning bidder has to
pay a Florida documentary stamp tax based on the amount of the bid. In most counties, the tax is
$0.70 on each $100 – or any portion of $100 - bid. (This roughly equates to a tax of $7 for every
$1000 bid.) Because of the immediate funding requirements imposed on non-plaintiff bidders, it is
unusual for a plaintiff to be out-bid, particularly at a large commercial foreclosure sale.
After bidding closes and the sale is concluded, the Clerk will issue a Certificate of Sale which identifies
the successful bidder at the sale. Pursuant to § 45.0315, Florida Statutes, the Certificate of Sale
eliminates all rights of redemption, unless the court has specified otherwise. Objections to a
foreclosure sale must be filed within 10 days after the Clerk files the Certificate of Sale. Objections are
rare, and even when they occur, are rarely granted. Assuming no one has objected to the foreclosure
sale, the Clerk will issue the Certificate of Title approximately 11 days after the sale. The Certificate of
Title operates as the deed to the property.
9.6.1 2013 Changes to Foreclosure Law and Procedure
During the 2013 Florida state legislative session, the Florida legislature adopted a bill that
resulted in significant changes to the foreclosure procedure in Florida. In addition to changes
to the law that took effect on July 1, 2013, the Legislature requested that the Florida Supreme
Court modify the Florida Rules of Civil Procedure to conform to the act and create forms for
(a) New Complaint Requirements and Possession of the Original Note. For
residential foreclosures, the Complaint must affirmatively allege the plaintiff is
the holder of the note or the factual basis by which the plaintiff is entitled to
enforce the Note under Article 3 of the UCC. This change in the pleading
requirements also applies when servicers are prosecuting a foreclosure
action. If the plaintiff has been delegated authority to file foreclosure, the
complaint must describe the basis for the authority and identify with specificity
the document that gives the plaintiff authority.
To further substantiate standing and to ensure proper enforcement of any
mortgage to be foreclosed, the plaintiff must file a certification under penalty of
perjury when the complaint is filed that the plaintiff is in possession of the
original note, where the note is located, who verified possession and when
they did so. A complete copy of the note with all allonges must be attached.
The original note must be filed before judgment is entered. If the operative
promissory note has been lost, plaintiffs must comply with additional statutory
requirements before a foreclosure will be granted.
(b) Deficiency Judgments. Pursuant to the recent statutory changes, the statute
of limitations on "actions" for a deficiency judgment post-foreclosure expires
one year from "the day after the certificate is issued" by the clerk or the
mortgagee accepts a deed in lieu of foreclosure. The new law also limits any
deficiency in "owner-occupied residential property" to the difference between
the judgment amount and the fair market value of the property as of the sale
9.7 Easements
An easement is generally defined as the right of one party to use land of another for a particular
purpose. An easement is different from other interests in land (e.g., licenses) in that an easement
constitutes an interest in land which runs with the land and usually is permanent in nature. A license, by
contrast, merely gives one permission to do a particular act on another's land, does not run with title to
the land and is generally revocable at the pleasure of the grantor or after a given, usually relatively short,
An easement may be created by express grant or reservation in a deed of conveyance or other standalone
written instrument created for the purpose of establishing the easement. Since it is an interest in
real estate, an easement should be executed with the same formalities as a deed which requires, at a
minimum, a document signed by the grantor in the presence of two subscribing witnesses and a
description of the easement area. The grantor's signature should also be notarized in order to record the
easement in the official records book of the county in which it is located.
Easements can be exclusive or non-exclusive. An exclusive easement precludes any use of the
easement area by the grantor or its successors or assigns. A non-exclusive easement allows the
grantor to use the easement area for any purpose that does not interfere with the grantee's rights,
including granting easement rights to others. Non-exclusive easements may set forth in detail such
matters as degrees of exclusivity, responsibility for construction and maintenance of improvements,
compliance with laws and allocation of liability/risk. If the easement does not specify whether it is
exclusive or non-exclusive, it will be deemed to be non-exclusive.
Easements can be perpetual or for a specified duration. An easement will be deemed to be perpetual in
duration unless otherwise specified.
An easement may be used only for its specified purpose. Typical purposes of an easement include the
right to access, drain or locate utilities over, upon or under the property of another.
Under certain circumstances, easements may be established based on the actions of parties without
the need for a written instrument. Prescriptive easements, for example, may be established in a manner
similar to adverse possession, by the open, notorious, continued and uninterrupted use of another's
land for the prescriptive period.
Implied easements may be created in cases where no express grant or reservation exists. An easement
by way of necessity, for example, is an implied grant or reservation of an easement for ingress and
egress that arises from the supposed intention of parties when one party conveys land that is otherwise
landlocked. § 704.01, Florida Statutes, sets forth the elements necessary to establish an implied
easement by way of necessity.
There are several methods by which an easement may be terminated. Most commonly, an easement
may be released by a contract between the parties to the easement. In other circumstances, an
easement may be terminated by operation of law, through the doctrines of merger or adverse
possession, or by Florida's Marketable Record Title Act, Chapter 712, Florida Statutes. Additional
judicial doctrines such as equitable estoppel may also serve to terminate an easement.
9.8 Land Use and Zoning
9.8.1 Introduction and Overview
Florida has one of the most complex growth management frameworks in the nation. Florida law
requires that all local governments adopt and maintain comprehensive plans and that those
plans and plan amendments be reviewed by the State for their impacts on important state
facilities and resources and, in some cases, for compliance with state requirements. All
development regulations and all development orders must be consistent with the adopted local
comprehensive plan. The State also mandates regional and state review of large-scale projects
meeting specific development thresholds and has imposed special regulations on certain key
environmental areas. Within this framework, local governments still have the primary role in
regulating development and the role of the State has diminished pursuant to recent legislation.
In practice, this local regulatory role involves not only traditional tools such as comprehensive
planning, zoning and subdivision regulations, but also a growing number of additional
restrictions, such as design standards, that are specific to each jurisdiction. This section
provides an overview of Florida's growth management system.
Florida law contains substantial guidance and relatively detailed requirements for local
comprehensive plans. Nevertheless, local comprehensive plans and implementing land
development regulations are far from standardized, so development interests must thoroughly
understand the specific requirements of each jurisdiction. Moreover, recent state legislation,
particularly The Community Planning Act of 2011 (Chapter 2011-139, Laws of Florida),
significantly reduced state oversight and changed many substantive and procedural
requirements of statute. Florida's growth management law has continued to evolve in
subsequent legislative sessions and local governments are still adjusting to the new processes
and requirements. Users of this Guide are therefore cautioned to seek the advice of counsel on
any transaction-specific questions of law.
9.8.2 Local Government Authority
Local governments in Florida enjoy home rule authority granted by the Florida Constitution,
Article VIII, and further outlined through statute. They are therefore authorized to adopt plans
and ordinances to control the use of land, consistent with state requirements that pertain to
those subjects. Moreover, Florida statute mandates adoption of comprehensive plans and land
development regulations by both cities and counties. In a few jurisdictions, there are charter
provisions that give the county authority over certain planning and plan implementation
decisions within their municipalities, but in general, each jurisdiction has separate planning and
land use authority.
The majority of substantive and procedural requirements for local comprehensive planning in
Florida are contained in Chapter 163, Part II, Florida Statutes (the Community Planning Act).
While the "minimum criteria rule" for comprehensive plans (Rule 9J-5, Florida Administrative
Code) was repealed in 2011, there continue to be administrative rules that set requirements for
specific programs and areas.
9.8.3 Comprehensive Plan Requirements
Under Florida law, each local government must adopt a comprehensive plan containing
sections ("elements") to address specific topics. Required elements include: future land use,
transportation, infrastructure (sanitary sewer, solid waste, drainage, potable water and natural
groundwater aquifer recharge), conservation, recreation and open space, housing, coastal
management, intergovernmental coordination and capital improvements. Some plans also
contain optional elements, such as public school facilities, urban design, economic
development and public safety. The plan must be internally consistent and based on consistent
data and analysis. Plans must be reviewed for possible updating every seven years.
9.8.4 Comprehensive Plan Authority
Unlike in many other states, in Florida the local comprehensive plan is the controlling document
for regulating development. The local plan (or portion thereof) takes precedence over even
zoning and other land development regulations. Land development regulations and
development orders (which are broadly defined in statute) must be consistent with the plan.
9.8.5 Comprehensive Plan Process
Because development must be consistent with the comprehensive plan, proposed
development may require changes to the plan to ensure consistency. These changes may
involve amending the future land use designation for the property or changes to other maps or
text within the plan.
Comprehensive plans and most amendments to the plans are reviewed by state and regional
agencies. Under the Community Planning Act, there are now two different "large-scale
amendment" review processes, which consist of a preliminary and final review and a period
during which the amendment may be challenged or appealed. The "expedited state review"
process is used for most amendments and is substantially quicker than the "state coordinated
review" process. Cases that are challenged or appealed by the state or by third parties go into
an administrative hearing process. In the past, resolving these cases has taken months or
years. It is unclear to what extent the procedural and legal changes within the 2011 Act might
affect the ability and timing to resolve challenges. Even when no appeals are filed, it takes
several months to complete a plan amendment, but the expedited state review process
significantly reduces the minimum time frame. The Community Planning Act removed the
previous twice-yearly limitation on large-scale amendments, but some local governments have
retained such limitations, which can cause additional delay while awaiting the next amendment
The local government may also allow certain small, low-impact changes in land use
designations ("small-scale amendments") to be processed at any time. These amendments are
not transmitted for state and regional review.
Because numerous state and regional agencies review changes to the comprehensive plan,
such changes may require negotiation with a variety of agencies to address concerns relative
to impacts on other land uses (including military installations and airports), environmental
resources, transportation facilities, schools and other facilities and resources. Additional
information on reviewing agencies is provided at the end of this section.
9.8.6 Concurrency Requirement
A key component of Florida's growth management framework is the "concurrency" provision,
which requires that the availability of facilities and services be timed to coincide with the
impacts of development. Concurrency is mandated by the State for the following facilities and
services: wastewater, potable water facilities, water supply, storm water and solid waste. Under
the 2011 Community Planning Act, concurrency became a local option, rather than a state
mandate, for transportation, public school facilities, and parks and recreation. As a result, some
local governments have rescinded in whole or in part their concurrency requirements for these
facilities, but many local governments have thus far retained them. Local plans use a variety of
methods to set level of service (LOS) standards for concurrency purposes and are required to
track the used and remaining capacity through concurrency management systems. As a
practical matter, some local governments have not adopted or have not maintained these
systems, but most of the larger and faster-growing jurisdictions do so.
Concurrency is a critical factor for development interests because if impacts of a proposed
development result in level of service deficiencies, the local government must ensure that the
deficiency is mitigated or deny the development. Mitigation takes many forms, including
payment of fees, construction of facilities and dedication of land. There are specific statutory
requirements for some types of mitigation, including provisions to ensure that new development
not be required to pay for existing deficiencies. As a practical matter, local government
interpretation of these provisions varies and negotiation between the applicant and the local
government is often critical.
Some local governments have adopted Transportation Concurrency Exception Areas (TCEAs),
within which LOS standards do not apply. In these areas, there is usually an emphasis on other
modes of travel and there may be special land use, design or transportation requirements. In
the past, the ability to adopt TCEAs has been limited due to statutory criteria. Although
transportation concurrency is now optional, some local governments have opted to retain
transportation concurrency, but establish TCEAs within certain areas, potentially facilitating
development in those locations. Other local governments have completely replaced their
transportation concurrency systems with mobility plans, which typically include special
requirements and fees that may vary depending on the location and character of the
development area.
9.8.7 Land Development Regulations (LDRs)
Statutes also require that each local government adopt a unified development code to
implement the comprehensive plan. These Land Development Regulations ("LDRs") must cover
a broad array of topics, including: subdivision, use of land and water, compatibility, open
space, environmental protection, signage, concurrency management, on-site traffic
management and flood control. In most instances, LDRs are not reviewed by the State, but
they must be consistent with the local comprehensive plan. They may, and often do, further
limit the uses allowed under the plan and provide more specific development standards not
contained within the plan.
Many local governments in Florida have an extensive set of LDRs that may include
development standards for urban design and even for architectural style. More sophisticated
local governments are adopting new provisions that encourage or sometimes even mandate
that projects accommodate certain design criteria, such as principles of smart growth and
pedestrian-oriented design. Standards may include restrictions on maximum floor area for
commercial establishments, requirements for lining parking garages with habitable units,
placement of surface parking to the rear of buildings, the preservation of view corridors, and the
use of specific colors and materials consistent with the surrounding neighborhood. However,
many local governments, especially some smaller towns and rural counties, maintain LDRs
containing conventional zoning and subdivision requirements similar to those commonly found
around the country.
LDRs often require that development proposals obtain special approval from the local
government, either through administrative mechanisms or through public hearings before the
local legislative body, planning and zoning boards, and/or design review boards. Some
jurisdictions require such approval when a development proposal exceeds a certain amount of
building area or floor area. Some go so far as to mandate that any development proposal
consisting of more than a single-family home obtain site plan approval before the legislative
body. LDRs specify those uses that require a special exception or conditional use permit, both
of which entail additional processes and sometimes additional standards. Departures from the
LDRs typically require application for and approval of a variance at a public hearing.
In the past, local processes often required that development proposals secure permits from
federal, state and regional government agencies (such as the applicable water management
district or the Florida Department of Environmental Protection) before local approval could
occur. Legislation passed in 2012 prohibits this, but allows the local government to condition
its approval on issuance of such permits.
Because of the complexity of these regulations and processes, development interests are
advised to seek professional assistance from a Lex Mundi-affiliated advisor who can provide
counsel on the complex local and state requirements.
9.8.8 Development of Regional Impact (DRI) Process
One of the earliest requirements adopted into Florida's growth management system was the
DRI process, a special review required for large-scale projects to ensure that the impacts of
development, and particularly extra-jurisdictional impacts, are addressed and mitigated. While
the DRI development order is issued by the local government, DRIs are subject to state and
regional review and to appeal of the DRI development order by the state land planning agency.
The determination of whether a project must go through the DRI process has been based on
types of use and the amount of development. The development thresholds for triggering the
DRI process vary by location.
Legislation passed in 2009 exempted development in many urbanized areas of the state from
the DRI process. Additional legislation in 2011 further reduced the number of projects required
to go through the process. In 2015, Chapter 2015-30, Laws of Florida essentially ended the
program for new projects. New projects that are not already exempt from DRI review and meet
the DRI thresholds under § 380.06, Florida Statutes, will instead be reviewed as a
comprehensive plan amendment through the state-coordinated comprehensive plan review
process under § 163.3184(4), Florida Statutes. There are still a number of questions regarding
implementation of this provision, but it means no new projects will be required to undergo the
lengthy and costly process of DRI review. Clearly, local governments will retain considerable
leverage to negotiate and condition the project approval, as they do with all projects that require
a comprehensive plan amendment.
The provisions of chapter 380.06 and associated administrative rules 9J-2 and 29-24, Florida
Administrative Code, remain in place for existing DRIs. There are various processes for
removing the DRI status of existing DRIs, but many projects will retain DRI status, either
because they cannot meet the criteria for removing the DRI, or because they choose to retain
it, most often due to the vesting it provides. These projects will remain subject to ongoing
requirements for monitoring, record-keeping and reporting, and changes to the approved
development program can trigger additional review by state and regional agencies.
9.8.9 Areas of Critical State Concern (ACSCs)
Florida has a handful of areas that are designated as Areas of Critical State Concern (ACSCs).
This program was established to protect resources and public facilities of major statewide
significance. Designated Areas of Critical State Concern are:
• City of Apalachicola (Franklin County)
• City of Key West and the Florida Keys (Monroe County)
• The Green Swamp (portions of Polk and Lake Counties)
• The Big Cypress Swamp (Collier County)
Comprehensive plans and LDRs in these areas must address the issues that led to the ACSC
designation. The State maintains more oversight of planning and development in the ACSCs,
and has authority to review local development orders and appeal those that are inconsistent
with state guidelines. These appeals are made to the to the Governor and Cabinet sitting as the
Administration Commission. Within ACSCs, the state land planning agency also reviews and
approves not only amendments to comprehensive plans but also land development regulations
proposed by local governments. Comprehensive plan amendments within ACSCs are not
eligible for the expedited state review process.
9.8.10 Agencies with Review Authority for Comprehensive Plans and
Numerous state and regional agencies are involved in review of local plans and DRIs. The
Community Planning Act limits the role of reviewing agencies with respect to comprehensive
plan amendments. In most cases, the oversight role for state agencies is limited to comments
regarding adverse impacts on "important state resources and facilities" that pertain to each
agency's specific area of responsibility.
Review of comprehensive plan amendments is coordinated by the Division of Community
Planning and Development in the Department of Economic Opportunity (DEO) (the "state land
planning agency"). State review agencies include the DEO, the Florida Department of
Environmental Protection (DEP), the Florida Department of Transportation (DOT), the Florida
Department of Education (DOE), the Florida Department of State and, for county plans and
amendments, the Florida Fish and Wildlife Conservation Commission (FWC) and the Florida
Department of Agriculture and Consumer Services (FDACS). Regional review agencies include
the appropriate regional planning council (RPC) and water management district (WMD).
Adjacent local governments and military bases may also have the right of review. The state land
planning agency makes the determination on whether to challenge comprehensive plan
amendments in the expedited state review process and, in the state coordinated review
process, issues the notice of intent regarding whether to find the amendment in compliance
with state requirements. It is also the only agency with appeal authority for DRIs.
9.9 Eminent Domain
The power of Eminent Domain is governed by both federal and state law.
9.9.1 In General
The fundamental power of the sovereign to take private property for the public use is limited by
both the United States and Florida Constitutions and applicable state statutes. The Fifth
Amendment to the United States Constitution prohibits the federal government from taking
private property for public use without paying just compensation, and the Fourteenth
Amendment extends this protection to private property takings by the state and its subordinate
9.9.2 Florida Constitution
Article X, § 6, of the Florida Constitution provides that "no private property shall be taken except
for a public purpose and with full compensation therefor paid to each owner or secured by a
deposit in the registry of the court and available to the owner." The Florida Constitution also
recognizes that the law may provide for the taking of easements by due process for the
drainage of the land of one person over or through the land of another. The key to the Florida
constitutional provision is the guarantee of "full compensation" rather than the more customary
"just compensation" found in other jurisdictions. Full compensation is substantially broader and
includes the requirement that the condemning authority pay not only for the taking, but also the
condemnee's reasonable expenses to defend against the taking. Reasonable expenses
include attorney's fees as well as other professional fees for such experts as, but not limited to,
appraisers, land planners, engineers, and architects .
9.9.3 Florida Statutes
Chapters 73 and 74, Florida Statutes, establish the process for the exercise of eminent
domain. Chapter 73 establishes the overall procedure for a taking, while Chapter 74
establishes the process for takings qualifying as "Quick Takes" under the applicable statutes.
Chapter 70.001, entitled The Bert J. Harris Private Property Rights Protection Act, provides for
compensation to property owners where property rights have been damaged in instances not
rising to the level of a direct or inverse condemnation. The authority to take has been extended
to other state and local entities by a myriad of specific statutes. These statutes both authorize
and limit the scope of the taking power tailored by the legislature to the specific needs of the
9.9.4 Public Purpose and Necessity
Both a "Public Purpose" and a "Public Necessity" are required. As in federal law, public
purpose and public use have become synonymous. In reaction to the federal Kelo case, the
Florida legislature adopted legislation prohibiting taken private property from being conveyed to
a private entity within 10 years of the taking. Further, in contrast to many other jurisdictions, the
legislation prohibits takings of private property for slum/blight clearance. Public necessity
needs to be only reasonable necessity, not absolute necessity.
9.9.5 Condemnation Actions
(a) By Condemnor (de jure). As in most jurisdictions, Florida has a bifurcated
process in condemnation. The first issue is the authority for the
condemnation, the liability phase. If the condemning entity succeeds in
obtaining the court's judgment approving the taking, done at the Order of
Taking hearing, the litigants then move to the second phase of the action, the
damages phase. If the condemning authority fails at the liability phase, the
condemnee is entitled to reasonable fees and costs from the condemnor for
defending the suit. If the condemnee fails to defeat the taking at the liability
phase, no fees or costs are recoverable.
(b) By Property Owner (de facto). Inverse condemnation actions are recognized
in Florida as property rights are guaranteed by the Florida Constitution (Art. X,
§ 6; Art. I, § 9). As in de jure takings, full compensation must be paid to the
aggrieved property owner if it prevails in the liability phase of the case.
However, if the property owner fails in proving the taking, attorney fees and
costs are not recoverable and the property owner may be liable for
governmental costs associated with its defense. The taking occurs when the
government substantially interferes with the property owners use and
enjoyment of the property; the taking may be permanent or temporary.
9.9.6 Private Property Rights Protection Act
The Bert J. Harris, Jr., Private Property Rights Protection Act, Florida Statutes § 70.001,
provides property owners compensation as a result of new government regulations that
inordinately burden the existing property rights. Claims must be filed within one year from the
application of the regulation to the property with the governmental entity which then has 180
days to respond prior to a lawsuit being filed by the property owner.
9.9.7 Business Damage Claims
In partial takings for right-of-way only, Florida Statutes provide for compensation for business
damages. Business damage claims are covered by Chapter 73. Claims for business
damages must be made within 180 days of receipt by the business owner of the notice
required by Florida Statutes § 73.015(2)(a). The claim must be filed in writing by the business
owner, a certified public accountant or an expert in business damage claims and must be
accompanied by business records that support the claim. The business records supporting
the claim are exempt from disclosure under Florida's open public records statutes under two
circumstances: (a) disclosure of the documents would cause the business owner substantial
damage to its competitive status in the market and (b) the business owner must request the
9.9.8 Income Taxes
Acquisition of private property by a governmental entity through condemnation is an exchange
and is a taxable event. While losses must be recognized immediately, gains may be deferred
under some circumstances.
Federal and Florida State Environmental Compliance
Robyn D. Neely, Esq. | (407) 419-8549 | firstname.lastname@example.com
10.1 Federal Environmental Laws Considerations
10.1.1 Resource Conservation and Recovery Act ("RCRA")
42 U.S.C. § 6901, et seq. RCRA gives the United States Environmental Protection Agency
("EPA") the authority to control hazardous waste from the "cradle-to-grave." This includes the
generation, transportation, treatment, storage, and disposal of hazardous waste. RCRA also set
forth a framework for the management of non-hazardous solid wastes. The 1986 amendments
to RCRA enabled EPA to address environmental problems that could result from underground
tanks storing petroleum and other hazardous substances. The administration of RCRA has
been delegated to a number of states by statute (including to Florida through the Hazardous
Waste Management Act) and, therefore, the states regulate most aspects of hazardous waste
management within their borders.
RCRA Subtitle C authorizes EPA to regulate the treatment, storage, transportation, and disposal
of hazardous wastes, which are wastes that may cause, or significantly contribute to, an
increase in mortality or an increase in serious irreversible, or incapacitating reversible, illness; or
pose a substantial present or potential hazard to human health or environment when improperly
treated, stored, transported, or disposed of, or otherwise managed. This RCRA program is
implemented through regulatory requirements and/or federally or state issued permits.
RCRA Subtitle D also provides for the promulgation of guidelines for nonhazardous solid waste
collection, transport, separation, recovery, and disposal practices and systems. "Solid waste"
is defined as any garbage, refuse, or sludge from a waste treatment plant, water supply
treatment plant, or air pollution control facility, and other discarded material, including solid,
liquid, semisolid, or contained gaseous material resulting from industrial, commercial, mining,
and agricultural operations, and from community activities. It does not include solid or
dissolved material in domestic sewage, or solid or dissolved materials in irrigation return flows or
industrial discharges that are point sources under the Federal Water Pollution Control Act
("FWPCA"), or source, special nuclear or byproduct material as defined by the Atomic Energy
Act. Perhaps the most significant impact of RCRA, as amended, is the authority to impose a
total ban on land disposal of untreated hazardous wastes.
Finally, to address the growing environmental threat posed by leaking underground storage
tanks ("USTs"), in November 1986, Congress amended RCRA to add Subtitle I which provides
EPA with the authority to regulate USTs containing petroleum and other hazardous substances.
10.1.2 Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA" or "Superfund")
42 U.S.C. § 9601, et seq. CERCLA, or Superfund as it is commonly called, was enacted in
1980 to provide for the clean-up of abandoned disposal sites. It also provides a vehicle for the
EPA to recover for damage to natural resources caused by hazardous substance releases.
This statute has possibly generated more litigation and controversy in the past 25 years than
any other federal legislation.
CERCLA authorizes EPA to investigate and remediate or otherwise address properties
contaminated by hazardous releases and to recover the cost of cleanup and associated
damages from the responsible parties. EPA's authority includes two types of response actions:
(1) short–term emergency responses to releases or threatened releases of hazardous
substances ("removal actions") and (2) long–term response actions that permanently and
significantly reduce the danger of releases or threatened releases of hazardous substances
("remedial actions"). Sites can be cleaned up solely by EPA using the funds in the superfund,
or by responsible parties under EPA oversight. EPA's cleanup monies come from a superfund
created by taxes on the chemical and petroleum industries. EPA is then entitled to recover its
documented costs from responsible parties, which can include owners, past owners and
operators of the site and generators and transporters of waste, or other hazardous materials
containing hazardous substances, sent to the site.
CERCLA allows the government and private parties to sue "potentially responsible parties," or
"PRPs", for reimbursement of clean-up costs caused by releases, actual or threatened, of
hazardous substances. Liability is strict, joint and several, with little or no regard for causation.
By statute, there are four categories of persons liable for clean-up costs:
• "Owners or operators" of the contaminated facility. A "facility" is virtually any place
in which a hazardous substance is found. The current owner or operator is liable,
regardless of when the hazardous substance was disposed of at the facility and
whether the present owner or operator did anything to contribute to the release.
• "Owners or operators" of the facility at the time of release of the hazardous
substances. Any person who contracted or arranged to have hazardous
substances taken to, disposed of, or treated at a facility. This category generally
applies to generators and manufacturers.
• Transporters of hazardous substances.
• Anyone who "arranged" for the disposal of hazardous substances. An entity
qualifies as an arranger only if it takes intentional steps to dispose such
substances. Mere knowledge that a release may occur does not meet this intent
There are limited defenses under Superfund that are narrowly construed. A PRP can escape
liability if it can establish that the hazardous substance release was caused solely by an act of
war, an act of God, or an act of unrelated third parties. This latter "third party" defense does
not apply if the damage from hazardous substances was caused by an employee or agent of
the PRP, or a third party acting in connection with a contract with the PRP.
Another provision of CERCLA, the Emergency Planning and Community Right-to–Know Act
(Title III of the Superfund Amendments and Reauthorization Act, requires the reporting of the
storage or of releases of hazardous substances in quantities above specified amounts (aka,
reportable quantities).
10.2 The Clean Air and Clean Water Acts
10.2.1 The Clean Air Act ("CAA")
42 U.S.C. § 7401, et seq. The CAA regulates air pollutants under federal standards implemented and
enforced by the states. The CAA is divided into six titles: (1) Title I deals with control of pollution from
stationary sources; (2) Title II deals with control of pollution from mobile sources; (3) Title III addresses
general and administrative matters; (4) Title IV addresses emissions and sources that contribute to acid
deposition; (5) Title V establishes an operating permit requirement for sources of air pollution; and (6)
Title VI regulates substances that deplete stratospheric ozone.
The CAA requires EPA to promulgate national ambient air quality standards ("NAAQS") for certain
pollutants to protect the public health (primary NAAQS) and protect the public welfare (secondary
NAAQS). Each state is required to adopt a plan, called a State Implementation Plan ("SIP"), that limits
emissions from air pollution sources to the degree necessary to achieve and maintain the NAAQS. The
SIP provides emission limitations, schedules and timetables for compliance by stationary sources.
The CAA focuses on "major" stationary sources – defined as sources which emit, or have the potential
to emit, more than a prescribed amount of a designated pollutant. Because many industrialized urban
areas have not attained the standards, the 1990 Amendments established deadlines and requirements
for Nonattainment areas. Control requirements for individual facilities generally are more stringent in
Nonattainment areas, however, states are also required to adopt measures to prevent significant
deterioration of air quality ("PSD") in "clean air areas."
In addition to the SIP regulatory scheme, the Act establishes two other major regulatory programs for
stationary sources. The New Source Performance Standards ("NSPS") program establishes stringent
emissions limitations for "new" sources in designated industrial categories regardless of the state in
which the source is located or the air quality associated with the area. An owner or operator of a new or
modified source must demonstrate compliance with the NSPS within 180 days of initial start–up of the
unit. In addition, the National Emissions Standards for Hazardous Air Pollutants ("NESHAP") regulates
emissions of pollutants for which no NAAQS is applicable but which cause increases in mortality or
serious illnesses.
10.2.2 The Clean Water Act ("CWA")
33 U.S.C. § 1251, et seq. The CWA provides EPA with regulatory jurisdiction over discharges
of pollutants into the waters of the United States, which includes the coastal waters, rivers and
their tributaries, wetlands, and other bodies of water. The goal of the CWA is to restore and
maintain swimmable, fishable waters throughout the U.S. and to eliminate discharge of
pollutants into the nation's waters.
The § 402 National Pollutant Discharge Elimination System ("NPDES") is a permitting program
to regulate the point discharges of pollutants into waters of the U.S. Under the NPDES
Program, EPA, or an authorized state, processes permit requests. As discussed below, EPA
has approved the State of Florida NPDES program. NPDES Permits set forth the national and
state limits for pollutant discharges, as well as site specific compliance monitoring and reporting
requirements. Such pollutant discharge limits generally apply at the "end-of–pipe" and are
intended to ensure that the water quality is adequate for the water's designated use, such as
boating, swimming or fishing.
Section 404 of the CWA is a permitting program to regulate discharges into U.S. waters,
including wetlands, of dredge and fill materials, which can include dirt, gravel, tree stumps, and
other solid materials. The Army Corps of Engineers has the direct authority to process the
permit applications; EPA comments on the permit applications, can veto a permit the Corps
intends to issue, and has the authority to enforce these provisions of the Clean Water Act.
Section 311 provides requirements for preventing, reporting and responding to spills of oil or
hazardous substances into waters of the U.S. EPA implements this program in partnership with
the Coast Guard. Following the Exxon Valdez tragedy, EPA's authority was further streamlined
and strengthened by passage of the Oil Pollution Act of 1990.
10.3 State Environmental Laws Considerations
Florida has one of the most comprehensive environmental regulatory programs in the United States. A
number of state agencies and local governments in Florida implement various regulatory programs to
protect Florida's diverse ecology and promote responsible development, industrial, and agricultural
activities within the state. Below is a general summary of the primary environmental agencies and
regulations within Florida.
10.3.1 Agencies
(a) Florida Department of Environmental Protection ("FDEP"). FDEP is Florida's
lead environmental regulatory agency. FDEP is charged with protecting
Florida's air, land, water and natural resources pursuant to certain Florida
Statutes and implementing regulations in the Florida Administrative Code, as
set forth in further detail below. In addition, FDEP carries out certain federal
environmental programs pursuant to delegated authority from the EPA.
FDEP works closely with other state agencies and local governments (both
county and municipal authorities) to implement its broad environmental
regulatory programs. FDEP has the authority to delegate certain programs
(including certain water, natural resources, waste management, hazardous
materials, and petroleum programs) to specific qualifying local governments,
who then implement such environmental programs, via FDEP-approved local
ordinances, and codes.
Further, FDEP has oversight authority over Florida's water resources. FDEP
generally oversees the five (5) independent Florida Water Management
Districts, which have significant regulatory authority over activities involving
surface waters and groundwater, including the regulation of wetlands,
stormwater, and consumptive water use/pumping (of both ground and
surface waters), within the respective water basins of the Florida. FDEP also
coordinates the state's coastal management by serving as a clearinghouse for
all information and research and providing requested assistance to coastline
local governments that are developing coastal zone protection plans. FDEP
has comprehensive rulemaking authority which extends to administrative
regulation and enforcement activities. Rulemaking and rule challenges,
licensing, declaratory statements, and "decisions affecting substantial interest"
concerning FDEP and other state agencies are generally heard by
administrative law judges within the Florida Department of Management
Services, Division of Administrative Hearings ("DOAH") pursuant to the Florida
Administrative Procedures Act, contained within Florida Statutes Chapter 120,
and in certain circumstances, within the Florida circuit courts.
FDEP's approach to enforcement has evolved to include such concepts as
compliance assistance, pollution prevention, in–kind penalties, and other
creative solutions to resolve noncompliance issues. FDEP staff often work
with responsible parties in a non-adversarial manner to fulfill FDEP's duty to
protect the environment, while taking the varied interests of the responsible
parties into account. FDEP has the authority to utilize risk based closure
principles for sites. FDEP, however, still resolves the majority of
noncompliance problems and violations by use of traditional regulatory
enforcement tools, including, enforcement actions, consent orders, and/or
litigation potentially resulting in administrative, civil, and criminal penalties,
irrespective of intent.
(b) Florida Department of Agriculture and Consumer Services ("DACS"). DACS
administers various state and federal environmental programs primarily
through four (4) divisions/offices. The Division of Agricultural Environmental
Services administers programs including coordinating the state mosquito
control program; agricultural pesticide registration, testing and regulation; pest
control regulation; and feed, seed and fertilizer production inspection and
testing. The Division of Aquaculture generally regulates aquaculture facilities
and shellfish processing plants; the opening/closing of shellfish harvesting
waters; and the leasing of submerged state lands for aquaculture. The Florida
Forestry Service generally manages the forest resources of Florida by
implementing certain silviculture, fire suppression, and forest resource
programs. The Office of Agricultural Water Policy facilitates communications
among federal, state, local agencies, and the agricultural industry on water
quantity and water quality issues involving agriculture.
(c) Florida Department of Economic Opportunity ("DEO"). Created in 2011, DEO
succeeded the Department of Community Affairs as the Florida state
planning agency. DEO impacts the development and use of Florida natural
resources through its review and comment on proposed local government
comprehensive plans.
(d) Executive Office of the Governor. The Florida Land and Water Adjudicatory
Commission ("FLAWAC"), comprising the Governor and Cabinet, sits as a
super agency to review certain DEO and FDEP permits and approvals.
(e) Florida Fish and Wildlife Conservation Commission ("FWC"). FWC exercises
the Florida's executive and regulatory power over marine life, wild animal life,
freshwater aquatic life, and habitat management.
(f) Florida Department of Health ("DOH"). In addition to the regulation of general
public health issues, DOH has supervision and control over all private water
systems and public water systems not covered or included in the Florida Safe
Drinking Water Act (including septic systems, discussed in further detail
below). Moreover, DOH is authorized to license and regulate the
manufacture, production, transportation, use, handling, storage, disposal,
sale, lease, or other disposition of radioactive material and radiation machines.
(g) Florida Division of Emergency Management ("DEM"). DEM is responsible for
implementing in Florida the Emergency Planning and Community Right-to-
Know Act of 1986 ("EPCRA") which requires owners and operators to report
threshold quantities of regulated chemicals stored on site to enable state and
local agencies to track potential chemical hazards in communities. For
example, commercial (including multifamily) properties with emergency
generators having above ground fuel storage tanks generally containing more
than 1,360 gallons of diesel fuel are required to file annual notices /
registrations with DEM under EPCRA.
10.3.2 Regulations
Below is a brief summary of some of FDEP's primary environmental regulations.
(a) Florida Air and Water Pollution Control Act. The Florida Air and Water Pollution
Control Act, Florida Statutes §§ 403.011-403.42, requires all stationary
installations that reasonably will be expected to be a source of air or water
pollution to have a permit issued by the FDEP, except in those limited
instances in which FDEP rules authorize an exemption. Below is a summary
of select programs addressed in this Florida Air and Water Pollution Control
(i) Air. FDEP regulates the emission of air pollutants from major and
minor stationary sources during both the construction and operation
phase of such stationary sources, pursuant to Florida Statutes
§ 403.087. This program is modeled closely after the Federal Clean
Air Act, and a many of the activities undertaken by the program
involve controlling six criteria air pollutants identified by the US EPA:
ozone, carbon monoxide, nitrogen dioxide, sulfur dioxide, particulate
matter, and hazardous air pollutants.
The owner or operator of any facility that emits or can reasonably be
expected to emit any air pollutant is generally required to obtain an
individual or general air permit from FDEP, as applicable, pursuant to
Rule 62-210.300, Fla. Admin. Code ("F.A.C."). Further, all major
sources of air pollution (Title V sources) are subject to the air
operation permit requirements of Chapter 62-213, F.A.C., except
those Title V sources permittable pursuant to Rule 62-213.300,
Enforcement involving FDEP's air pollution control program relies
upon the general statutory prohibitions in Florida Statutes Chapter
403 relating to pollution and the air program rules contained within
Chapters 62-204 through 62-297, F.A.C.
(ii) Stormwater. FDEP implements the NPDES stormwater permitting
program in Florida. The majority of industrial activities requiring an
NPDES stormwater permit will likely qualify for an NPDES general
permit, known in Florida as a "generic" permit, issued by FDEP under
the authority of Florida Statutes § 403.0885, and the requirements
set forth in Rule 62-621.300(5)(a), F.A.C. In the alternative,
stormwater discharges from industrial activities that are not eligible for
a generic permit must be covered under an individual permit with
requirements specific to the facility as specified under Chapter 62-
620, F.A.C. Additional regulations applicable to both NPDES permits
are contained within Chapter 62-4, F.A.C.
(iii) Wastewater. FDEP further implements the NPDES wastewater
permitting program in Florida. Florida Statutes § 403.0885
establishes the NPDES program for domestic and industrial
wastewater in Florida, which closely follows the Federal NPDES
program. The non-NPDES domestic wastewater program is
administered pursuant to the general statutory discharge prohibitions
set forth throughout Florida Statutes Chapter 403 and program rules
set forth in Chapters 62-600 through 62-650, F.A.C. Further, the
industrial wastewater program is administered pursuant to the general
statutory discharge prohibitions set forth throughout Florida Statutes
Chapter 403 and program rules set forth in Chapters 62-625, 62-
650, 62-660, and 62-670, F.A.C.
In a related matter, Onsite Sewage Treatment and Disposal Systems
("OSTDS"), which include septic tanks, are regulated by the Bureau
of Onsite Sewage Programs in the DOH and applicable local
government health departments, pursuant to Chapter 64E-6, F.A.C.
In addition, beginning January 1, 2011, pursuant to recent legislation
amending Florida Statutes § 381.0065, DOH will implement a
program that requires owners of onsite sewage treatment and
disposal systems to perform an evaluation and assessment of such
systems one every five (5) year period.
(b) Florida Resource Recovery and Management Act (Solid and Hazardous
Waste). The Florida Resource Recovery and Management Act, Florida
Statutes §§ 403.702–403.7895, and its implementing rules govern the
generation and disposal of solid and hazardous wastes within Florida. FDEP
is responsible for implementing the Florida Resource Recovery and
Management Act, which is modeled, in part, after the Federal Resource
Conservation and Recovery Act of 1976, as amended ("RCRA"), and the
Federal Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended ("CERCLA"), and contains similar waste
management and liability provisions. Chapters 62-701 through 62-722,
F.A.C., generally set forth FDEP's solid waste regulations, and Chapter 62-
730, F.A.C., generally set forth FDEP's hazardous waste regulations.
(c) Florida Water Resources Act. FDEP and five regional water management
districts ("WMD") generally administer the provisions of the Florida Water
Resource Act, set forth in Florida Statutes Chapter 373, which concerns
activities involving surface and groundwater including the regulation of
wetlands, stormwater, and consumptive water use/pumping (of both
groundwater and surface water). Parties are generally required to obtain an
environmental resource permit ("ERP") from the respective WMD to perform
certain regulated activities such as dredging and filling in wetlands,
construction of drainage facilities, stormwater containment and treatment,
construction of dams or reservoirs, and other activities affecting state waters.
Further, parties are required to obtain a consumptive use permit ("CUP") or a
water use permit ("WUP") from the respective WMD to withdraw surface or
groundwater for certain reasonable and beneficial uses such as public supply
(drinking water), agricultural and landscape irrigation, and industry and power
generation. There are a number of variations and requirements concerning
the application, maintenance, and renewal of ERPs, CUPs, and WUPs,
generally set forth in Chapters 40A through 40E, F.A.C.
(d) Pollutant Discharge Prevention and Control Act. The Pollutant Discharge
Prevention and Control Act, Florida Statutes §§ 376.011-376.21, generally
prohibits the discharge of pollutants into or upon any waters or lands of
Florida. Further, other related provisions, such as Florida Statutes § 376.302
(which identifies other similar and/or related prohibited acts), create liability for
any discharges or polluting conditions.
In the event of such a violation and/or covered release, responsible parties are
generally required to remediate affected properties to the extent necessary to
meet to certain numeric cleanup target levels, which are different for each
respective pollutant, media (i.e., soil or groundwater), and land use (residential
or industrial). Specific FDEP cleanup criteria are set forth in: 62-777, F.A.C.
(Contaminant Cleanup Target Levels); and 62-780, F.A.C. (Contaminated Site
Cleanup Criteria, i.e., risk based corrective action ("RBCA")). Please note that
on June 12, 2013, Chapter 62-770, F.A.C. (Petroleum Contamination Site
Cleanup Criteria); 62-782, F.A.C. (Drycleaning Solvent Cleanup Criteria); and
62-785, F.A.C. (Brownfield Cleanup Criteria Rule) were repealed and certain
provisions from those rule chapters were consolidated and incorporated into
Chapter 62-780, F.A.C. (Contaminated Site Cleanup Criteria).
In addition to FDEP enforcement of such provisions, Florida Statutes
§ 376.313 has been held to create a strict liability private cause of action for
adjacent properties owners impacted by certain covered releases of
pollutants. See Aramark Uniform & Career Apparel, Inc. v. Easton, 894 So.2d
20 (Fla. 2004).
(e) Underground and Aboveground Storage Tanks. FDEP also regulates the
registration, construction, maintenance, installation, removal, and disposal of
underground and aboveground tanks pursuant to Florida Statutes § 376.303.
Further, Florida Statutes § 376.308(1) holds a number of parties strictly liable
for prohibited discharges including the person causing the discharge, the
person who owned or operated the facility at the time of the discharge, the
person who owned or operated the tanks at the time of the discharge, and
the person who currently owns the facility. In addition, Chapters 62-761 and
62-762, F.A.C., contains FDEP's rules regulating underground and
aboveground storage tanks and their associated piping.
(f) Brownfields Redevelopment Act. The Brownfields Redevelopment Act
(Florida Statutes §§ 376.77–376.85), created a voluntary program for local
governments and state agencies to provide financial and regulatory incentives
and technical assistance to persons and businesses involved in the
redevelopment of Florida "brownfield sites", which are defined in § 376.79(3)
as "…real property, the expansion, redevelopment, or reuse of which may be
complicated by actual or perceived environmental contamination."
Florida offers a number of incentives for participating in the Florida brownfields
program, including: a voluntary cleanup tax credit (§ 376.30781, Florida
Statutes), bonus tax refunds (§ 288.107, Florida Statutes), capital investment
tax credits (§ 220.191, Florida Statutes), certain exemptions from sales taxes
on building materials (§ 212.08(5)(o), Florida Statutes), a loan guarantee
program (§ 376.86, Florida Statutes), an innovation incentive program
(§ 288.1089, Florida Statutes), an educational grant program (§ 288.047,
Florida Statutes), and other various local government economic and regulatory
incentives. Further, participation in the Florida brownfields program generally
results in a limited liability protection to any person, including his or her or its
successors and assigns, who executes and implements to successful
completion a brownfield site rehabilitation agreement, pursuant to
§ 376.82(2), Florida Statutes.
Any person or entity that has not caused or contributed to the contamination
of a brownfield site after July 1, 1997, may be eligible to participate in the
brownfield rehabilitation program pursuant to § 376.82(1), Florida Statutes.
Further, a local government with jurisdiction over a brownfield area is
authorized to designate the area by resolution as a brownfield under the
brownfield program designation and administration process set forth in
§ 376.80, Florida Statutes. Once a site has received the brownfield
designation, the person responsible for brownfield site rehabilitation must then
enter into a brownfield site rehabilitation agreement ("BSRA") with the FDEP or
delegated local program if actual contamination exists at the brownfield site.
The BSRA, which sets forth the parameters and timeline for brownfield site
remediation, includes, among other requirements, a commitment to conduct
site rehabilitation consistent with state, federal, and local laws and consistent
with the brownfield site contamination cleanup criteria specified in Rules 62–
780 and 62–777 of the F.A.C.
Dispute Resolution in Florida
Christopher S. Carver, Esq. | (305) 982-5572 | firstname.lastname@example.com
James M. Miller, Esq. | (305) 982-5624 | email@example.com
Gerald B. Cope, Esq. | (305) 982-5622 | email@example.com
11.1 Federal Court System
The trial courts of the federal court system are the U.S. District Courts. There are 94 federal Districts in
the United States. Florida has three federal districts: the Northern District, the Middle District and the
Southern District. The judges of the United States District Courts and United States appellate courts are
appointed by the President of the United States, with the advice and consent of the Senate and hold
office during good behavior. Appeals from Florida's District Courts are to the United States Court of
Appeals for the Eleventh Circuit.
Federal courts are courts of limited jurisdiction. The types of cases they may hear are mandated by
both Article III of the U.S. Constitution and federal statute. Federal courts have exclusive jurisdiction over
cases arising in bankruptcy, patent and copyright, antitrust, postal matters, internal revenue, admiralty,
federal crimes, federal torts, and customs. To the extent federal courts have jurisdiction over other
matters, it is concurrent with that of the state courts. However, federal courts are not courts of "general
jurisdiction," which are courts that can hear almost any case. As an example, state trial courts are courts
of general jurisdiction and have jurisdiction (within certain limits) of any matter arising under a state's laws
and also matters outside the exclusive jurisdiction of federal courts.
There are generally two ways to gain access to the federal district courts where concurrent jurisdiction
exists. First is diversity jurisdiction, which involves disputes between "citizens of different states" with an
"amount in controversy" exceeding $75,000. To be brought in federal court under diversity jurisdiction,
there must be complete diversity, i.e., none of the plaintiffs may be a citizen of the same state as any of
the defendants and the dispute must involve an amount (somehow quantified) greater than $75,000.
The second primary basis is federal question jurisdiction, which is where a dispute presents an issue
arising under the Constitution, statutes, or treaties of the United States. If a plaintiff's case does not fit
within one of the statutory bases for federal jurisdiction, there is no recourse to the federal courts.
The workings of the federal district courts for civil matters (separate from bankruptcy and criminal
matters) are governed by the Federal Rules of Civil Procedure, promulgated by the U.S. Supreme Court
and approved by the U.S. Congress. These are a uniform body of procedural rules applicable to every
federal district court in the U.S. Each federal district court also establishes its own rules applicable only
to the procedure in that district court, but those rules are in addition to the Federal Rules and may not
contravene them.
The procedural rules often set forth very specific guidelines for the handling of an action, and close
attention must be paid to them. A litigant in a suit in federal district court must be aware of that court's
local rules as well as the Federal Rules of Civil Procedure.
Almost all appeals from Florida's federal courts are taken to the United States Court of Appeals for the
Eleventh Circuit, which also handles appeals from Georgia and Alabama's federal courts. An exception
to this is patent decisions, which are handled by the Court of Appeals for the Federal Circuit and not by
the Eleventh Circuit. The vast majority of appeals are taken from final trial court judgments. Federal
appellate courts have very limited jurisdiction with respect to non-final orders, which jurisdiction includes
decisions regarding injunctions and receiverships, certain admiralty decisions, and decisions certified by
a trial court as being ones involving a controlling question of law as to which an appellate ruling would
"materially advance the ultimate termination of the litigation." The Eleventh Circuit is the final appellate
court for almost every case; only in rare cases would an issue be addressed by the United States
Supreme Court. The Supreme Court chooses the cases it takes, with a vote of four Justices having to
agree that an issue is worthy of consideration. Fewer than one percent of applications to the Supreme
Court to take a case are granted.
11.2 State Court System
11.2.1 Trial Courts
Florida has a two-tiered trial court system composed of circuit courts and county courts.
(a) Circuit Courts. The circuit courts are sometimes referred to as courts of
general jurisdiction in recognition of the fact that most criminal and civil cases
originate at this level. These courts handle all trial matters except those below
a monetary jurisdictional threshold.
(i) Organization. The Florida Constitution provides that a circuit court
shall be established to serve each judicial circuit established by the
Legislature, of which there are twenty. Within each circuit, there may
be any number of judges, depending upon the population and
caseload of the particular area. In more populated areas, a circuit
may encompass just one county; in less populated areas, a circuit
may encompass as many as seven counties.
Circuit court judges are elected by the voters of the circuits in
nonpartisan, contested elections. Circuit court judges serve for sixyear
A chief judge is chosen from among the circuit judges and county
judges in each judicial circuit to carry out administrative
responsibilities for all trial courts (both circuit and county courts) within
the circuit.
(ii) Jurisdiction. Circuit courts have general trial jurisdiction over matters
not assigned by statute to the county courts. Circuit courts also hear
appeals from county court cases, except for county court orders or
judgments declaring invalid a state statute or a provision of the
Florida Constitution and orders or judgments of a county certified to
the district court of appeal as being of great public importance and
accepted for review. Thus, circuit courts are simultaneously the
highest trial courts and the lowest appellate courts in Florida's judicial
The trial jurisdiction of circuit courts includes, among other matters,
original jurisdiction over civil disputes involving more than $15,000;
controversies involving the estates of decedents, minors, and
persons adjudicated as incapacitated; cases relating to juveniles;
criminal prosecutions for all felonies; tax disputes; actions to
determine the title and boundaries of real property; suits for
declaratory judgments (ones seeking a declaration of legal rights or
responsibilities regarding an existing dispute); and requests for
injunctions to prevent persons or entities from acting in a manner that
is asserted to be unlawful.
Circuit courts are also granted the power to issue the extraordinary
writs of certiorari, prohibition, mandamus, quo warranto, and habeas
corpus, and all other writs necessary to the complete exercise of
their jurisdiction.
(b) County Courts
(i) Organization. The Florida Constitution establishes a county court in
each of Florida's 67 counties. The number of judges in each county
court varies with the population and caseload of the county.
County judges are elected by the voters of the county in nonpartisan,
contested elections and serve six-year terms.
(ii) Jurisdiction. The trial jurisdiction of county courts is established by
statute. The jurisdiction of county courts extends to civil disputes
involving $15,000 or less. Thus, a dispute involving exactly $15,000
would be heard in county court, not circuit court.
The county courts are sometimes referred to as "the people's
courts," because a large part of the courts' work involves voluminous
citizen disputes, such as traffic offenses, less serious criminal matters
(misdemeanors), and relatively small monetary disputes. Litigants
frequently are not represented by attorneys in county courts; in fact,
representation by an attorney in county court makes a litigant subject
to additional procedural obligations.
11.2.2 Appellate Courts
(a) Supreme Court
(i) Organization. The highest Court in Florida is the Florida Supreme
Court, which is composed of seven Justices. At least five Justices
must participate in every case and at least four must agree for a
decision to be reached. The Court's official headquarters is the
Supreme Court Building in Tallahassee.
The Florida Constitution provides for a "merit retention" system for
Florida's appellate judges. This system was meant to eliminate the
many problems caused by judges running for office in an election.
When Justices' terms expire, their names will appear on the general
election ballot for a merit retention vote if they wish to remain in office.
Under this system, the voters do not choose between competing
candidates for a Justice position. Instead, the question on the ballot
is: "Shall Justice [X] be retained in office?" If a majority of the votes
cast are not in favor of retaining the incumbent Justice, Florida's
Governor appoints another person to fill the vacancy. The Governor
chooses the next Justice from a list of between three and six
qualified persons recommended by the Judicial Nominating
By a majority vote of the Justices, one of the Justices is elected to
serve as Chief Justice, an office that is rotated every two years. The
Chief Justice presides at all proceedings of the Court. If the Chief
Justice is absent from Court, the most senior Justice present
becomes acting Chief Justice. By longstanding tradition, the most
senior Justice who has not yet served as Chief Justice is elected to
the top post in every even-numbered year.
As chief administrative officer of the judicial branch of government,
the Chief Justice assigns Justices and judges, including retired
Justices and judges who consent and are approved by the Court to
serve, to duty in courts that require temporary assistance. The Chief
Justice also supervises the compilation and presentation of the
judicial budget to the Legislature.
(ii) Jurisdiction. The jurisdiction of the Florida Supreme Court is set out
in the Florida Constitution with some degree of flexibility through
which the Legislature may add or take away certain categories of
cases. The Florida Supreme Court must review final orders imposing
death sentences, district court decisions declaring a State statute or
provision of the Florida Constitution invalid, bond validations, and
certain orders of the Public Service Commission on utility rates and
In addition to these forms of mandatory review authority, the Florida
Supreme Court at its discretion may review any decision of a district
court of appeal that expressly declares valid a state statute,
construes a provision of the state or federal constitution, affects a
class of constitutional or state officers, or directly conflicts with a
decision of another district court or of the Florida Supreme Court on
the same question of law. A party must request that the Florida
Supreme Court accept such a case, which request the Court may
grant or reject. The grant of such a request is the most common way
for a civil litigant to obtain review by the Florida Supreme Court,
although this aspect of its jurisdiction is not often exercised by the
The Florida Supreme Court may review any decision of a district
court of appeal that passes on a question certified by that court to be
a question of great public importance, or a question certified by a
district court of appeal as being in direct conflict with a decision of
another district court of appeal.
The Florida Supreme Court may review a trial court order certified by
a district court of appeal as being of great public importance or to
have a great effect on the administration of justice throughout the
state and requiring immediate resolution by the Florida Supreme
The Florida Supreme Court may review a question of Florida law
certified by the Supreme Court of the United States or by a United
States Court of Appeals which is deemed to be determinative of an
issue governed by Florida law in a federal case for which there is no
controlling precedent of the Florida Supreme Court.
The Florida Supreme Court has the constitutional authority to issue
the extraordinary writs of prohibition, mandamus, quo warranto, and
habeas corpus and to issue all other writs necessary to the complete
exercise of its jurisdiction. These writs, which bear names as ancient
as their common-law origins, have been considered indispensable to
our legal system, and the Florida Constitution specifically authorizes
their issuance in a proper case without the necessity of having to
proceed initially to trial. They are by nature "extraordinary," and for
that reason are not available as an alternative to the usual trial and
appeal. Both by their historical development and by current judicial
decisions, the writs are made available only in a narrow class of
exceptional cases.
The Florida Supreme Court also renders advisory opinions to the
Governor upon request on questions relating to the Governor's
constitutional duties and powers and must review voting district plans
submitted by the Legislature. As the state's highest tribunal, the
Florida Supreme Court possesses distinctive powers that are
essential to the exercise of the state's judicial power but that are not,
strictly speaking, decision-making powers in contested cases.
The Florida Supreme Court promulgates rules governing the practice
and procedure in all Florida courts, subject to the power of the
Legislature to repeal any rule by a two-thirds vote of its membership,
and the Florida Supreme Court also has the authority to repeal (if five
Justices concur) any rule adopted by the Judicial Qualifications
The Florida Supreme Court has exclusive authority to regulate the
admission and discipline of lawyers in Florida. To assist in the
performance of those regulatory powers, the Florida Supreme Court
has adopted rules of professional conduct, established the Florida
Board of Bar Examiners to administer the admissions process, and
created The Florida Bar to superintend bar governance.
(b) District Courts of Appeal
(i) Organization. Most trial court decisions that are appealed never
reach the Florida Supreme Court. Rather, appellate review of trial
court decisions is conducted by three-judge panels of the district
courts of appeal. Florida did not have district courts of appeal until
Florida's Constitution now provides that the Legislature shall divide
the State into appellate court districts and that there shall be a district
court of appeal for each district. There are five districts and,
correspondingly, five district courts of appeal: the First District, the
Second District, the Third District, the Fourth District, and the Fifth
District. Roughly speaking, the First District encompasses Florida's
Panhandle, the Second District encompasses southwest Florida, the
Third and Fourth Districts encompass southeast Florida (including the
Florida Keys), and the Fifth District encompasses northern and
middle Florida.
District court judges must meet the same eligibility requirements for
appointment to office, and they are subject to the same procedures
and conditions for discipline and removal from office as Justices of
the Florida Supreme Court. Like Florida Supreme Court Justices,
district court judges also serve terms of six years and will be eligible
for successive terms under a merit retention vote of the electors in
their districts.
In each district court, a chief judge, who is selected by the district
court judges within the district, is responsible for the administrative
duties of the court.
(ii) Jurisdiction. The district courts of appeal can hear appeals from final
judgments and can review specified non-final orders. By general law,
the district courts have been granted the power to review final actions
taken by state agencies in carrying out the duties of the executive
branch of government.
Finally, the district courts have been granted constitutional authority to
issue the extraordinary writs of certiorari, prohibition, mandamus, quo
warranto, and habeas corpus, as well as all other writs necessary to
the complete exercise of their jurisdiction.
As a general rule, decisions of the Florida district courts of appeal
represent the final level of appellate review. Review of a decision of a
district court of appeal would be to the Florida Supreme Court on
issues of state law or to either the Florida Supreme Court and then to
the United States Supreme Court or directly to the United States
Supreme Court on issues of federal constitutional law or federal law
as to which state and federal courts have concurrent jurisdiction.
Except for the very few issues where Florida Supreme Court review is
required (such as decisions invalidating a state statute), most
requests for appellate review beyond a district court of appeal are
11.3 Alternative Dispute Resolution
Florida has a long tradition of encouraging alternative dispute resolution ("ADR"). Essentially, ADR
enables resolution of civil disputes without an adjudication through the court system. While there are a
number of ADR methods, by far the most common are mediation and arbitration, which are addressed
Mediation is an informal and non-adversarial process in which a neutral third person, the
mediator, acts to encourage and facilitate the settlement of a dispute between two or more
parties. The mediator has no power to adjudicate or force a settlement; all decision-making
authority remains with the parties to reach a mutually acceptable and voluntary settlement.
Mediation is mandatory in virtually every Florida circuit court civil dispute.
Florida Statutes Chapter 44 contains general provisions on mediation and non-binding
arbitration, including:
a. With limited exceptions, the court must refer a case to mediation upon the
request of any party (§ 44.102); however, in practice, most circuit trial courts
make mediation mandatory.
b. The court may refer any case to non-binding arbitration (a truncated form of
arbitration where the arbitral ruling is only final if no party requests a trial de
novo by the court) (§ 44.103).
c. Arbitrators have judicial immunity (§§ 44.107, 682.051, 684.0045). With
limited exceptions, mediators have the same immunity (§ 44.107).
d. All mediation communications are privileged and a party may not be
compelled to testify regarding mediation discussions (with very rare
exceptions) (§§ 44.401-406).
The procedures for mediation and court-ordered arbitration are set forth in the Florida Rules of
Civil Procedure (Fla. R. Civ. P. 1.700-1.830).
The Florida Supreme Court has promulgated a separate set of Rules for Certified and Court-
Appointed Mediators which include mediator qualifications, standards of professional conduct,
and disciplinary rules (Fla. R. Med. 10.100-10.900).
As a practical matter, virtually every civil case filed in either state court or in federal district court
in Florida will result in an order requiring the parties to mediate, and the procedures for
mediation will be spelled out in the order requiring mediation. This usually occurs at the time
the case is set for trial or when the first scheduling order is entered. The court will require that
the mediation be completed by a certain date, usually some set amount of time before the
commencement of trial, and the order will establish a procedure for the selection of the
mediator and a deadline for the selection. The parties' attorneys will usually agree upon the
selection of the mediator, but if they cannot the court will appoint one from an approved panel
of mediators.
One of the key features of Florida mediation is that the parties or their authorized
representatives having full authority to settle, not merely the attorneys of record, must attend the
mediation. The parties may stipulate or the judge may allow a party to attend by telephone,
upon motion made for good cause, but Florida courts are vigilant in requiring party attendance
at mediation. Upon the failure of a party to attend mediation without good cause, and upon
motion made, the court shall impose sanctions on the disobedient party. (Fla. R. Civ. P.
Finally, mediation is not limited to trial court disputes. Parties have the option to mediate at the
appellate level if they so choose (Fla. R. App. P. 9.700), and the Fifth District Court of Appeal
has a mandatory mediation process. In addition, the United States Court of Appeals for the
Eleventh Circuit requires almost every civil appeal to proceed through at least an initial
evaluation of the appropriateness of mediation.
11.3.2 Arbitration
Whereas mediation is a non-adversarial process through which the parties are encouraged to
reach a voluntary settlement, arbitration is an adversarial process generally resulting in a binding
decision. Arbitration is a proceeding in which a neutral third party, or panel of persons, the
arbitrator(s), considers the facts and arguments presented by the parties, typically in an
evidentiary hearing, and then renders a decision, or award, that is usually binding.
The Revised Florida Arbitration Code is contained in Chapter 682 of the Florida Statutes.
Florida has adopted the Revised Uniform Arbitration Act with a few modifications. The key
provisions include:
a. Arbitration agreements are valid, irrevocable, and enforceable (§ 682.02).
b. Courts have authority to compel or stay arbitration (§ 682.03).
c. Procedures are specified for conducting arbitration and for confirmation,
vacation, modification or correction of an award (§§ 682.04-682.14).
d. Courts are to enter a judgment based on an order confirming, modifying or
vacating an award (§ 682.15).
e. Appellate review is available for decisions granting, denying, or staying
arbitration, confirming or vacating an award, or modifying or correcting an
award (§ 682.20).
f. Provisional remedies are available to protect the effectiveness of the arbitration
proceeding to the same extent as if the controversy were the subject of a civil
action (§ 682.031).
g. Judicial enforcement is available for a pre-award ruling by the tribunal
(§ 682.081).
Although Florida has a separate arbitration code for both domestic and international disputes
(see below), the vast majority of decisions by Florida courts arise under the Federal Arbitration
Act, Title 9 U.S.C. § 1, et seq., which governs arbitration for any issue involving interstate or
foreign commerce or a maritime transaction.
The Florida Supreme Court has promulgated a separate set of Rules for Court-Appointed
Arbitrators which, like the rules for mediators, include arbitrator qualifications, standards of
professional conduct, and disciplinary rules (Fla. R. Arb. 11.010-11.130).
A great number of the arbitrations commenced in Florida are conducted under the rules and
procedures of the American Arbitration Association ("AAA") or another arbitration organization,
primarily because most contracts containing provisions for the arbitration of disputes so specify.
In such instances, resort to the Florida courts, laws, and procedures is typically had only for the
entry of a judgment on the award.
11.3.3 International Commercial Arbitration
The Florida International Commercial Arbitration Act (the "Act") was enacted in 2010, putting
Florida at the forefront of international commerce and arbitration. This Act is contained in
Chapter 684 of the Florida Statutes. It is based on the United Nations Model International
Commercial Arbitration Act promulgated by the United Nations Commission on International
Trade Law ("UNCITRAL"). The UNCITRAL Model Act has been widely adopted internationally
and is well understood by the international legal community. Florida is one of only seven states
to have enacted the Model Act in the United States.
Pursuant to this law, parties to an international business dispute may arbitrate in Florida when
there is a written agreement providing for arbitration in Florida (§ 684.0002, 684.0049). Among
the many features of the Act are the recognition and enforcement of awards, including the
equal treatment of all awards regardless of the country of origin (§ 684.0047). The Act also
reduces the risks of international litigation by authorizing the arbitrators to rule on their own
jurisdiction (§ 684.0017), and provides them the power to enter interim measures and
preliminary orders (§§ 684.0018-684.0028).
In 2013, the circuit court in Miami, Florida, created the International Commercial Arbitration
Court to hear issues arising under the Federal Arbitration Act and the Florida International
Commercial Arbitration Act. Under both statutes, the judicial role is quite restricted. Miami's
International Commercial Arbitration Court is one of the few such courts in the United States.
Robert E. Slavkin, Esq. | (407) 419-8438 | email@example.com
What follows is an outline of certain laws which must be considered by providers and other participants
in the healthcare industry in Florida, focusing primarily on the anti-referral and anti-fraud and abuse
statutes. A brief discussion of licensing requirements in Florida also follows. This outline is by no
means meant to be an exhaustive discussion on what are highly complex laws regulating the healthcare
industry in Florida. Users of this Guide are advised to consult Lex Mundi-affiliated healthcare counsel
with specific questions regarding practitioner license matters, operation matters and other healthcare
practice and operations questions with respect to transaction-specific matters.
12.1 Federal Law
12.1.1 Physician Self-Referral Prohibition (Stark)
The Physician Self-Referral Prohibition, commonly referred to as the "Stark Law,"
generally provides that, subject to certain exceptions, a physician may not refer
patients for Medicare-covered "designated health services" to any entity with which the
physician (or an immediate family member of the physician) has a financial relationship,
and the entity may not bill for any services provided as a result of the prohibited referral
(see 42 U.S.C. § 1395nn. See also 42 C.F.R. § 411.351-357). A "designated health
service" includes, among other things, inpatient and outpatient hospital services,
clinical laboratory services, physical therapy services, occupational therapy services,
radiology services, radiation therapy services and supplies, durable medical equipment
and supplies, home health services, and outpatient prescription drugs. The full list of
designated health services may be found at 42 U.S.C. § 1395nn.
The Stark Law contains approximately thirty-five (35) exceptions. These exceptions
outline acceptable financial relationships which may occur that otherwise could be
perceived to be potential physician self-referrals. These exceptions can be grouped
into the different categories as follows: ownership and investment interests, or
compensation arrangements. These exceptions include personal service contracts,
non-monetary compensation, bona fide employment agreements, certain compliance
training contracts, and rent for facilities, equipment and personnel.
12.1.2 Federal Anti-Kickback Statute
The Federal Anti-Kickback Statute, among other things, prohibits any person from
"knowingly and willfully" paying or offering any remuneration in exchange for or to
induce the referral of any item or service covered by a federal healthcare program.
The statute has been broadly interpreted by federal courts to prohibit any payment if
any one purpose of the payment is to induce the referral of covered goods or services,
irrespective of whether there are other, legitimate business purposes for the payment.
Conditions under the statute constitute a felony and may result in a fine of $25,000 per
offense plus imprisonment of up to 5 years or both. Additionally, there is a possibility
of civil exclusion from the federal healthcare programs for 5 years or more and civil
monetary penalties.
Currently there are 25 "safe harbors" to the federal anti-kickback statute. These safe
harbors outline acceptable contractual and business arrangements which, if followed,
do not lead to a violation of the federal anti-kickback statute. The anti-kickback statute
may be found at 42 U.S.C. § 1320a-7b and the anti-kickback safe harbors may be
found at 42. C.F.R. 1001.952(a)-(y).
12.1.3 Federal False Claims Act
The False Claims Act prohibits knowingly submitting for payment or reimbursement a
claim known to be false, making or using a false record or statement material to a false
or fraudulent claim or engaging in a conspiracy to commit fraud by improper
submission of a false claim, and concealing, improperly avoiding, or decreasing an
obligation to pay the government. The False Claims Act allows people who are not
affiliated with the government to file claims against federal contractors accused of
committing fraud against the government, and therefore the U.S. taxpayers. This is
generally referred to as a Qui Tam or whistleblower lawsuit.
12.2 Florida Law
12.2.1 Patient Self-Referral Act of 1992
Under the provisions of Florida Statutes § 456.053, "A healthcare provider may not
refer a patient for the provision of designated health services to an entity to which the
healthcare provider is an investor or has an investment interest." This statute is similar
to the federal Stark Law; however, there are specific differences between the federal
and Florida laws. Most importantly, the Stark Law is limited to claims submitted to
federal healthcare programs such as Medicare. The Florida Self-Referral Act applies to
all claims submitted to all payers by healthcare practitioners in the state.
Designated health services under the statute include clinical laboratory services,
physical therapy services, comprehensive rehabilitative services, diagnostic imaging
services and radiation therapy services. It is also unlawful for a healthcare provider to
refer a patient for the provision of any other healthcare item or service to an entity in
which the healthcare provider is an investor unless the investment meets certain
criteria. The term "healthcare provider" is defined as any licensed, medical
osteopathic, chiropractic or podiatric doctor, persons licensed under The Optometry
Practice Act and persons licensed as dentists or related practitioners under Chapter
466 of the Florida Statutes.
Exceptions to the self-referral prohibition include orders, recommendations and plans
of care by radiologists for diagnostic imaging services, and physicians specializing in
radiation therapy for such services; medical oncologists for intravenous drugs and
solutions to treat cancer and related complications; cardiologists for cardiac
catheterization, pathologists for diagnostic clinical laboratory services and pathologic
examination services if furnished under the supervision of a pathologist pursuant to a
consultation requested by another physician; healthcare providers for services
provided solely to their own patients that are provided under the direct supervision;
ambulatory surgical center services; urologists for lithotripsy services; dentists for
dental services performed by employer/contractor of the dentist or dental group;
physicians for infusion therapy services to a patient of the physician or the physicians
group practice; nephrologists for renal dialysis services and supplies except for
laboratory services; and healthcare providers whose principle professional practice
consist of treating patients in their private residences, except home health.
The statute also imposes additional requirements on group practices or sole providers
who accept outside referrals for diagnostic imaging: no more than fifteen percent
(15%) of patients referred may be from outside referrals for such an arrangement to not
violate the statute. There are also limitations providing employees for services,
management contracts, appropriate billing (professional/technical component) and
attestation requirements regarding documentation. The provider violating the act is
subject to a civil penalty of not more than $15,000 for each service where there is a
violation. Circumvention arrangements are subject to a civil penalty of not more than
$100,000. These violations are also the grounds for disciplinary action by the state
licensing boards. These penalties are similar to the penalties which can be imposed
under the Federal Stark Act.
12.2.2 State Anti-Kickback Statute
The state Anti-Kickback Statute may be found at Florida Statutes § 456.054. It is
unlawful under the act for any healthcare provider or provider of services to offer, pay,
solicit, or receive a kickback directly or indirectly overtly or covertly in cash or in kind for
referring or soliciting patients. A kickback, like the Federal Anti-Kickback Statute,
means remuneration or payment by or on behalf of a provider of services or items to
any person as an incentive or an inducement to refer patients for past or future
services or items when the payment is not tax deductible as an ordinary and
necessary expense. Violations are considered patient brokering and are punishable
under Florida Patient's Brokering Act, discussed below. Several individual practice
acts in Florida include provisions similar to this as grounds for discipline including the
Medical Practice Act at 458.331, the Osteopathic Medicine Act at 459.015,
Naturopathy Act at 462.14, Occupational Therapy at 468.217 and the Respiratory
Therapy Act at 468.365.
12.2.3 Florida Patient Brokering Act
As referenced in the section discussing the Florida Anti-Kickback Statute above, it is
unlawful for any person including a healthcare provider or healthcare facility to offer,
pay, solicit or receive any commission, bonus, rebate, kickback or bribe, directly or
indirectly, in cash or in kind, or engage in any split fee arrangement in any form
whatsoever to induce or in return for referral of patients or patronage to or from a
healthcare provider or healthcare facility. This is referred to as the Florida Patient
Brokering Act and may be found at Florida Statutes § 817.505. It is also unlawful to
solicit or to receive remuneration in return for acceptance or acknowledgement of
treatment from a healthcare provider or a facility or to aid, abet or advise or otherwise
participate in any of the above conduct. The act broadly defines the term healthcare
provider or facility to include any person or entity required to be licensed, certified or
registered or lawfully exempt from being required to be licensed, certified or registered
with the agency for healthcare administration or the Florida Department of Health. In
2012, the act was amended to exempt certain marketing, consultation, and referral
activities of assisted living facilities, as referenced in Florida Statutes § 429.195(2).
The key to the Patient Brokering Act and the Florida Self-Referral and Florida Anti-
Kickback Statute is the following:
If an arrangement in question does not violate the federal Anti-Kickback Statute, it is
not considered to violate the Florida Patient Brokering Act, and therefore would not be
considered a kickback or a violation of the self-referral prohibitions under Florida law
either. The provisions also do not apply to certain arrangements within group
practices, payments to healthcare providers or facilities for professional consultation
services. Lawful payments include payments by health insurers under health benefit
plans, payments to or by a healthcare provider facility or provider network entity for
goods and services under a plan, certain commissions or fees paid to a licensed
nurse registry, and payments by healthcare providers or facilities to health information
services to provide information upon request and at no cost to consumers about
providers in an area.
Violation of the Patient Brokering Act is a third degree felony, punishable by up to five
years imprisonment, a $5,000 fine per violation and habitual offenders it could be a ten
year term of imprisonment.
12.2.4 Fee Splitting Prohibitions
Florida's fee splitting statute prohibits physicians from, among other things, engaging in
any split-fee arrangement with another person including other doctors for patients
referred to providers for healthcare goods or services. The fee splitting statute may be
found at Florida Statutes § 458.331(1)(i). Penalties include fines and possible medical
license revocation. It should be noted that the statute does not define "fee splitting."
However, the Florida Board of Medicine has reviewed and interpreted the fee splitting
statute numerous times. There are dozens of Florida Board of Medicine declaratory
statements regarding the fee splitting statute. Additionally, there is ample case law in
Florida on the subject. Prior to providing counsel regarding the issue of fee splitting, a
more in-depth analysis of the declaratory statements from the Board of Medicine as
well as the case law, must be conducted.
12.2.5 Professional Licensure in Florida
The Florida Statutes outline the conditions for licensure for an array of healthcare
practitioners. Florida Statutes Chapter 456 sets forth general compliance statutes for
all healthcare practitioners in the state. Note that it is within Chapter 456 that the
Florida anti-referral prohibitions and the Florida anti-kickback statute are housed. There
are profession-specific provisions as well that cover acupuncturists (Chapter 457),
medical doctors (Chapter 458), Osteopaths (Chapter 459), Chiropractors (Chapter
460), Podiatrists (Chapter 461), Naturopaths (Chapter 462), Optometry (Chapter 463),
Nurses (Chapter 464), Pharmacists (Chapter 465), Dentists, Hygienists and Dental
Labs (Chapter 466), and Midwives (Chapter 467). There is also Chapter 468, a
catchall chapter covering speech and language pathologists, audiologists, nursing
home administration, occupational therapists, radiological personnel, respiratory
therapists, dieticians as well as, oddly, auctioneers, talent agents and community
associations. Each of these professions has a professional board that is part of the
Florida Department of Health, Division of Medical Quality Assurance. These boards
oversee and ensure compliance with the statutes and accompanying regulations
relevant to each profession.
Appendix 1 - Page 1
Contributing Authors
Beppy Landrum Owen, Esq. | (407) 419-8463 | firstname.lastname@example.com
Regulation of International Trade and Investment
Pedro A. Freyre, Esq. | (305) 755-5821 | email@example.com
Felicia L. Nowels, Esq. | (850) 425-1661 | email@example.com
Antitrust Trade Regulations
Christopher S. Carver, Esq. | (305) 982-5572 | email@example.com
Lawrence D. Silverman, Esq. | (305) 982-5666 | firstname.lastname@example.com
Business Regulations
Vit M. Gulbis, Esq. | (813) 209-5007 | firstname.lastname@example.com
Brian Goossen, Esq. | (813) 209-5010 | firstname.lastname@example.com
Corporations, LLCs and Partnership Entities
Philip B. Schwartz, Esq. | (954) 468-2455 | email@example.com
Andrew E. Schwartz, Esq. | (954) 468-2452 | email@example.com
Alia R. Luria, Esq. | (407) 419-8599 | firstname.lastname@example.com
Sole Proprietorships and Joint Ventures
James F. Goldsmith, Esq. | (407) 419-8508 | firstname.lastname@example.com
Not for Profit Entities
Vit M. Gulbis, Esq. | (813) 209-5007 | firstname.lastname@example.com
Brian Goossen, Esq. | (813) 209-5010 | email@example.com
Florida B- and SP- Corporations
Philip B. Schwartz, Esq. | (954) 468-2455 | email@example.com
Andrew E. Schwartz, Esq. | (954) 468-2452 | email@example.com
Securities Regulation
Alan H. Aronson, Esq. | (305) 982-5562 | firstname.lastname@example.com
Federal Taxation
William F. Sullivan, Esq. | (954) 468-2464 | firstname.lastname@example.com
Florida State Taxation
Vit M. Gulbis, Esq. | (813) 209-5007 | email@example.com
Russell B. Hale, Esq. | (407) 419-8556 | firstname.lastname@example.com
Brian Goossen, Esq. | (813) 209-5010 | email@example.com
Labor and Employment
Christopher S. Duke, Esq. | (561) 671-3663 | firstname.lastname@example.com
Appendix 1 - Page 2
Intellectual Property
Michael K. Dixon, Esq. | (561) 671-3621 | email@example.com
Commercial Banking Opportunities
Virginia B. Townes, Esq | (407) 419-8513 | firstname.lastname@example.com
Real Estate Transactions
Jarrett D. Bingemann, Esq. | (407) 419-8551 | email@example.com
A. Carter Downs, Esq. | (407) 419-8580 | firstname.lastname@example.com
The Foreclosure Process
Megan C. DeVault, Esq. | (407) 419-8513 | email@example.com
Joseph E. Foster, Esq. | (407) 419-8511 | email@example.com
Ginnette Childs, Esq. | (407) 419-8592 | email@example.com
Cecelia Bonifay, Esq. | (407) 419-8540 | firstname.lastname@example.com
Valerie J. Hubbard | (850) 521-8003 | firstname.lastname@example.com
Land Use and Zoning
Cecelia Bonifay, Esq. | (407) 419-8540 | email@example.com
Valerie J. Hubbard | (850) 521-8003 | email@example.com
Eminent Domain
George W. Powell, Esq. | (305) 982-5587 | firstname.lastname@example.com
Federal and Florida State Environmental Compliance
Robyn D. Neely, Esq. | 407) 419-8549 | firstname.lastname@example.com
Dispute Resolution in Florida
Christopher S. Carver, Esq. | (305) 982-5572 | firstname.lastname@example.com
James M. Miller, Esq. | (305) 982-5624 | email@example.com
Gerald B. Cope, Esq. | (305) 982-5622 | email@example.com
Robert E. Slavkin, Esq. | (407) 419-8438 | email@example.com
Appendix 2 - Page 1
CareerSource Florida, Inc. - www.careersourceflorida.com
1580 Waldo Palmer Lane
Tallahassee, FL 32308
Phone: (850) 921-1119
Corporate Registered Agents
NRAI: www.nrai.com
Incorporating Services, Ltd.: http://www.incserv.com
National Corporate Research: http://www.nationalcorp.com/index.htm
Enterprise Florida, Inc. ("EFI") - www.eflorida.com
800 N. Magnolia Ave., Suite 1100
Orlando, FL 32803
Phone: (407) 956-5600
Fax: (407) 956-5599
Fish and Wildlife Conservation Commission ("FWC") - www.myfwc.com
Florida Fish and Wildlife Conservation Commission
Farris Bryant Building
620 S. Meridian St.
Tallahassee, FL 32399-1600
Phone: (850) 488-4676
Florida Department of Agriculture and Consumer Services ("DACS") - www.freshfromflorida.com
Florida Department of Agriculture and Consumer Services
Division of Administration
The Mayo Building, Fifth Floor, M12
407 S. Calhoun St.
Tallahassee, FL 32399-0800
Phone: (850) 617-7000
Fax: (850) 922-6967 Fax
Division of Agricultural Environmental Services
Phone: (850) 617-7900
Division of Agricultural Water Policy
Phone: (850) 617-1700
Division of Aquaculture
Phone: (850) 617-7600
Florida Forest Service
Phone: (850) 681-5800
Florida Department of Business & Professional Regulation ("DBPR") - www.myfloridalicense.com/dbpr
1940 North Monroe Street
Tallahassee, Florida 32399
Phone: (850) 487-1395
Appendix 2 - Page 2
Florida Department of Economic Opportunity ("DEO") - www.floridajobs.org
107 East Madison Street
Caldwell Building, MSC 150
Tallahassee, Florida 32399-4120
Phone: (850) 245-7105
Fax: (850) 921-3223
Division of Strategic Business Development
Phone: (850) 717-8960
Division of Workforce Services
Phone: (866) 352-2345
Division of Community Development
Phone: (850) 717-8500
Florida Department of Environmental Protection ("FDEP") - www.dep.state.fl.us/
3900 Commonwealth Boulevard M.S. 49
Tallahassee, Florida 32399
Phone: (850) 245-2118
Fax: (850) 245-2128
Florida Department of Health ("DOH"): www.floridahealth.gov/
Florida Department of Health
4052 Bald Cypress Way
Tallahassee, FL 32399
Phone: (850) 245-4444
Florida Department of State, Division of Corporations: www.sunbiz.org
P.O. Box 6327
Tallahassee, Florida 32314
Phone Numbers for Issues Relating to Corporations
Florida Profit/Non-Profit Articles: (850) 245-6052
Corporate Amendments/Dissolutions/Withdrawals: (850) 245-6050
Corporate Mergers/Registered Agent Changes: (850) 245-6050
Foreign Corporation Qualification: (850) 245-6052
Corporation Annual Reports: (850) 245-6056
Reinstatements: (850) 245-6059
Phone Numbers for Issues Relating to Limited Liability Companies (LLCs)
Florida LLC Articles: (850) 245-6051
Foreign LLC Qualification: (850) 245-6051
LLC Amendments: (850) 245-6051
LLC Reinstatements: (850) 245-6059
LLC Annual Reports: (850) 245-6056
LLC Registered Agent Changes: (850) 245-6051
LLC Mergers: (850) 245-6050
Phone Numbers for Issues Relating to Partnerships
General Partnership Filings: (850) 245-6051
Limited Partnership Filings: (850) 245-6051
Appendix 2 - Page 3
Limited Liability Partnership Filings: (850) 245-6051
Annual Reports: (850) 245-6056
LP and LLP Registered Agent Changes (850) 245-6051
LP Reinstatements: (850) 245-6059
LLP Reinstatements: (850) 245-6051
Miscellaneous Issues
Fictitious Names Registrations/Renewals: (850) 245-6058
Trade and Service Marks: (850) 245-6051
Federal Tax Liens: (850) 245-6011
Judgment Liens: (850) 245-6011
Apostilles: (850) 245-6945
Internet Support Section: (850) 245-6939
Certification/Copy Request: (850) 245-6053
Service of Process: (850) 245-6953
Florida Land and Water Adjudicatory Commission ("FLAWAC") -
Phone: (850) 717-9491
Florida Legislature: www.leg.state.fl.us/
Florida Resource Directory: http://redi.state.fl.us/
One stop source for learning about state and federal programs and agencies.
Florida Revenue Law Library: https://taxlaw.state.fl.us/
My Florida: www.myflorida.com
Official portal of the State of Florida's website of all things regarding Florida.
Office of Financial Regulation - www.flofr.com
200 East Gaines Street
Tallahassee, FL 32399
Phone: (850) 410-9893 (Registrations)
(850) 410-9500 (Enforcement)
Appendix 3 - Page 1
Florida State Government Organizational Chart
Appendix 3 - Page 2
Appendix 3 - Page 3