Doing Business Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Doing Business, written in plain English, along with examples of how it is used.
What is Doing Business?
v. Conducting a corporation’s normal activities on a regular basis. This distinction is significant when determining whether a corporation is “doing business” in another state so that a complaint may be served, determining whether it is subject to out-of-state taxes.
History and Meaning of Doing Business
The term "doing business" refers to the regular activities a corporation undertakes, whether it is within the state of incorporation or in other states. The actions that constitute "doing business" can include a wide range of activities, such as selling products or services, maintaining a physical presence, or employing workers.
The concept of "doing business" has been around for a long time and is an essential part of corporate law. State laws and regulations are designed to ensure that businesses operating within their borders follow certain rules and pay applicable taxes. Understanding what it means to "do business" in a particular state is crucial to determining whether a corporation is subject to those laws and regulations.
Examples of Doing Business
- A California-based company that regularly sells products to customers in Texas would be considered to be doing business in Texas and may be subject to Texas tax laws.
- A Florida-based corporation that maintains a physical office and employs workers in Georgia is likely doing business in Georgia and may be subject to Georgia labor laws.
- A New York-based corporation that regularly participates in trade shows in Illinois may be considered to be doing business in Illinois and may be subject to Illinois business registration requirements.
Legal Terms Similar to Doing Business
- Foreign qualification: Refers to the process of registering a corporation in a state where it is not incorporated in order to do business there.
- Nexus: The level of connection a corporation has with a particular state that triggers a requirement to comply with that state's laws and regulations.
- Attorney of record: An attorney who has been formally appointed to represent a party in a legal matter.
- Jurisdiction: The geographical area or legal authority in which a court has the power to make legal decisions.