Why do you need a registered agent?

Services > Registered Agent > Why do you need a registered agent?

The requirement to maintain a registered agent is a matter of consumer protection. State laws require a registered agent to ensure a company representative is easily accessible to a process server to accept Service of Process in case the company is sued.

Service of Process (SOP) is a legal procedure used most commonly to notify a defendant that a law suit has been initiated against it by a suing party (plaintiff). Service documents usually consist of a summons and complaint. The summons serves as official notice that a suit has been initiated against a defendant and compels a response to the claim within a certain time frame after service documents are accepted by a registered agent, usually 20 days. If the defendant fails to respond timely, the court may find the defendant in default and award a judgment in favor of the plaintiff.

A business entity should maintain a registered agent who is reliable and experienced. Many business entities will not appoint an employee or company officer as their registered agent as they usually have no experience in legal matters. If service material is not handled in a timely fashion it could result in a default monetary judgment against the company.

• Laws require a corporate entity to name a registered agent in their corporate documents. A registered agent must always remain on record or the entity could be administratively dissolved.
• Laws require the registered agent to be physically located in the state of business with a street address for accessibility. Post office boxes are not allowed.
• A registered agent should maintain accessibility to their physical location during normal business work hours without closure, except holidays.
• In most states, a registered agent can be an individual or business entity, however, a business entity cannot act as its own registered agent.
• Foreign entities that are qualified to transact business in a jurisdiction where they are not physically located must retain a registered agent service provider such as CorpDirect Agents.
• Annual reports, tax notices and other official correspondence are also forwarded to the registered agent in many states, so domestic entities should also retain a registered agent to ensure important documents are properly received and handled. Failure to file an annual report could cause the company to lose its goodstanding and liability protection.