Everyone knows what the United States Secretary of State does – meeting with foreign leaders, negotiating treaties, etc. But it’s a puzzle to most people what the North Carolina Secretary of State (NCSOS) does. It’s not intuitive.
One mission of the NCSOS’s office is to make it easier to do business in our state. They oversee the formation of new businesses and the dissolution of inactive ones. NCSOS registers and enforces trademarks within the state (but for use in other states, you would register with the federal Patent and Trademark Office). They register assumed business names (“DBAs”).
If you finance the purchase of a tractor or office equipment, you would likely pledge the asset as collateral for the loan. The lender will file a UCC financing statement with NCSOS to document that transaction.
The NCSOS website offers educational information for investors. It has information about cryptocurrency investing since that is a fairly new topic. Also related to investing, the department registers some securities dealers and financial advisors (some have federal registrations).
Crowdfunding has become a popular way to raise capital for small businesses. That is where you solicit small investments from a large number of investors, usually online. NCSOS registers crowdfunding activities within the state.
NCSOS issues charitable solicitation licenses that legally authorize charities to solicit funds in the state. You may be surprised to know that all charities soliciting donations in NC need this license, even if they do their own fundraising rather than hiring a third-party fundraiser.
The department maintains a registry of athletic agents authorized to do business in the state.
There are duties involving land. NCSOS is responsible for standardizing the filing methods and equipment used by county register of deeds offices. NCSOS maintains state and county boundary maps.
If you are a notary public, you know that NCSOS sets standards for notaries and approves each notary’s commission. A notary’s role is to determine that the person who signs a legal document is who they claim to be. NCSOS investigates notary fraud. Often notary fraud is the tip of the iceberg for a fraudulent transaction.
One function is an outlier from business-related duties. NCSOS will register health care advance directives for NC residents who send them in. By the way, I typically don’t advise clients to register their advance directives here because people commonly change these documents over time, but forget to update the NCSOS registry. Instead, I recommend clients give copies of their advance directives to their regular doctors, and let a family member or friend know where the original is kept at home for an emergency.
Elaine Marshall is the NC Secretary of State. Under her administration, NCSOS has greatly improved its technology and availability of information needed for business transactions. Many NCSOS documents can be filed electronically. Most of NCSOS’s business-related records, in particular the corporation and LLC registry, are available online for free (which is not the case in many states). These capabilities reduce friction and delay for business transactions in North Carolina.