In commercial real estate (CRE), compliance and data security are often considerations for both Sponsors and Investors. For example, when you form a company, you may want to avoid having your private information become public knowledge. A registered agent can step in as the acting agent for your company to help you maintain compliance and ensure a good standing status while protecting your business’ private information.
We sat down with Nicole Ellery, Director of Real Estate Operations at EntityKeeper, to get her take on how you can protect your firm’s legal data and information with the help of a registered agent. She also answered some of the most common questions we get about registered agents.
What is a registered agent?
A registered agent serves as a legal point of contact, ensuring that a firm receives important legal documents and notifications from government agencies and courts in a timely manner. A registered agent can help firms establish credibility and improve how they organize and structure their legal documents and data. Additionally, a registered agent offers privacy by shielding owners’ and executives’ personal addresses from being exposed in public records, enhancing security and minimizing unwanted solicitations. Lastly, a registered agent can aid firms in ensuring compliance with state regulations, staying up-to-date with filing requirements, and avoiding potential penalties or legal complications.
Do I need a registered agent?
You should consider obtaining a registered agent when you establish your company, especially if it’s an LLC, corporation, or other formal legal entity. A registered agent becomes indispensable when you operate in a state where your business is not physically located, ensuring you have a designated representative to receive legal documents and important communications. Furthermore, if your company frequently changes its physical address or operates across multiple states, a registered agent offers stability by providing a consistent point of contact for legal matters. Whether you’re starting a new venture or expanding an existing one, recognizing the need for a registered agent early on can help you maintain compliance, streamline communication, and navigate legal obligations effectively.
Can I be my own registered agent?
The simple answer is yes, you can be your own registered agent. But, you should consider what exactly that entails and whether your time, money, and expertise are better spent elsewhere.
Registered agents must:
- Keep Regular Business Hours: Registered agents must keep regular business hours, so they can accept important documents on behalf of the business. This commitment may affect your availability for other important tasks.
- Have an Agent in Every State: You are required to have a registered agent in every state that your business operates. This can be challenging and expensive if you have physical locations in multiple states.
- Receive and Manage Documents: Processing mail is a simple process, but that then puts the responsibility on you to read, understand, and act on important notices. This adds to your administrative workload and requires careful attention to detail.
What risks can being my own registered agent pose to my company’s privacy?
When you opt to act as your own registered agent, you may be exposed to certain privacy risks. For example, if you serve as your own registered agent and run your business from home, your home address might become available to the public. And although creating a P.O. Box may sound like the obvious solution to this problem, it’s not so simple. Businesses that use a P.O. Box cannot serve as their own registered agent. That’s because registered agents must have a physical office in all states in which the company operates.
Once your information is public, companies can take your information and use it to their advantage. Businesses may collect consumer data and use it to power better customer experiences and marketing strategies. They may also sell your data for revenue. Unfortunately, there is no way to avoid external companies from accessing and using your information once it is public.
How can a third-party agent help protect my information and data?
A registered agent can help limit the amount of personal information you have to put on public documents. For example, when you use EntityKeeper, you don’t have to share your sensitive information (address, contacts, etc). Instead, your registered agent will provide their information on public documents to keep your data safe.
What advice would you give businesses seeking a registered agent for the first time?
Rather than incorporating your business and then choosing a registered agent, you can do it all at once through EntityKeeper. EntityKeeper’s Corporate Services includes services that can help you get your business up and running and help you establish a registered agent at the same time. This approach will save you time, money, and additional fees that are often required to update your agent.
What advice would you give to businesses looking to switch to a new registered agent?
Consolidate your agent and documents sooner rather than later to ensure you maintain compliance. Streamline and create operational efficiencies rather than having to notify and manage multiple emails and communications from several sources.
About EntityKeeper Corporate Services
EntityKeeper Corporate Services are designed to protect your entity data, save you time and money, and ensure you meet critical reporting deadlines. When you select EntityKeeper as your registered agent, you’ll receive a free entity health performance evaluation to assess your entity’s standing. If we find any issues, we’ll guide you on resolving the problem.
Contact us to explore our Corporate Services and get more information on your entity health evaluation.