Texas Business Organizations Code 9.051 – Transacting Business or Maintaining Court Proceeding Without Registration
(a) On application by the attorney general, a court may enjoin a foreign filing entity or the entity’s agent from transacting business in this state if:
(1) the entity is not registered in this state; or
(2) the entity’s registration is obtained on the basis of a false or misleading representation.
(b) A foreign filing entity or the entity’s legal representative may not maintain an action, suit, or proceeding in a court of this state, brought either directly by the entity or in the form of a derivative action in the entity’s name, on a cause of action that arises out of the transaction of business in this state unless the foreign filing entity is registered in accordance with this chapter. This subsection does not affect the rights of an assignee of the foreign filing entity as:
(1) the holder in due course of a negotiable instrument; or
(2) the bona fide purchaser for value of a warehouse receipt, security, or other instrument made negotiable by law.
Terms Used In Texas Business Organizations Code 9.051
- Business: means a trade, occupation, profession, or other commercial activity. See Texas Business Organizations Code 1.002
- Contract: A legal written agreement that becomes binding when signed.
- Entity: means a domestic entity or foreign entity. See Texas Business Organizations Code 1.002
- Filing entity: means a domestic entity that is a corporation, limited partnership, limited liability company, professional association, cooperative, or real estate investment trust. See Texas Business Organizations Code 1.002
- Foreign: means , with respect to an entity, that the entity is formed under, and the entity's internal affairs are governed by, the laws of a jurisdiction other than this state. See Texas Business Organizations Code 1.002
- Foreign filing entity: means a foreign entity, other than a foreign limited liability partnership, that registers or is required to register as a foreign entity under Chapter 9. See Texas Business Organizations Code 1.002
- General partner: means :
(A) each partner in a general partnership; or
(B) a person who has become, and has not ceased to be, a general partner in a limited partnership in accordance with the governing documents of the limited partnership or this code. See Texas Business Organizations Code 1.002 - Law: means , unless the context requires otherwise, both statutory and common law. See Texas Business Organizations Code 1.002
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Managerial official: means an officer or a governing person. See Texas Business Organizations Code 1.002
- Member: means :
(A) in the case of a limited liability company, a person who has become, and has not ceased to be, a member in the limited liability company as provided by its governing documents or this code;
(B) in the case of a nonprofit corporation, a person who has membership rights in the nonprofit corporation under its governing documents;
(C) in the case of a cooperative association, a member of a nonshare or share association;
(D) in the case of a nonprofit association, a person who has membership rights in the nonprofit association under its governing documents; or
(E) in the case of a professional association, a person who has membership rights in the professional association under its governing documents. See Texas Business Organizations Code 1.002
(c) The failure of a foreign filing entity to register does not:
(1) affect the validity of any contract or act of the foreign filing entity;
(2) prevent the entity from defending an action, suit, or proceeding in a court in this state; or
(3) except as provided by Subsection (d), cause any owner, member, or managerial official of the foreign filing entity to become liable for the debts, obligations, or liabilities of the foreign filing entity.
(d) Subsection (c)(3) does not apply to a general partner of a foreign limited partnership.