2021 Delaware Entity Statutory Amendments
Consistent with Delaware’s practice of annually amending its entity statutes to meet the needs of the changing business community, the State of Delaware’s Governor recently signed into law the 2021 amendments to Delaware’s Limited Liability Company Act, Revised Uniform Limited Partnership Act, Revised Uniform Partnership Act (the “RUPA”) and General Corporation Law (the “DGCL”). There were no amendments this year to Delaware’s Statutory Trust Act, which is generally amended every other year. This year’s statutory amendments will go into effect on August 1, 2021.
There was only one amendment to the DGCL this year, which clarifies certain voting rights and quorum requirements when stock is held directly or indirectly by the corporation itself.
Notable amendments to Delaware’s alternative entity statutes include (i) providing a statutory ratification process for otherwise void or voidable acts, (ii) adopting the historically corporate “necessary and essential” test for members of an LLC and partners of a partnership to request books and records, (iii) allowing a conflicted member, manager or partner to delegate its management authority to an independent party without passing along its conflict to the delegate, (iv) modifying the requirements for an LLC or limited partnership to become a statutory public benefit entity and (v) clarifying the applicability of the RUPA with respect to a general partnership that has opted out of certain default statutory provisions.
For a more detailed discussion of the amendments discussed above, please click here.
