Texas 2019 - 86th Regular

Texas Senate Bill SB2019 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	86R9908 JES-D
2	2	By: Miles S.B. No. 2019
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to requiring female representation on the governing
8	8	authorities of certain business entities; authorizing an
9	9	administrative penalty.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Chapter 3, Business Organizations Code, is
12	12	amended by adding Subchapter C-1 to read as follows:
13	13	SUBCHAPTER C-1. COMPOSITION OF GOVERNING AUTHORITY FOR CERTAIN
14	14	BUSINESS ENTITIES
15	15	Sec. 3.115. DEFINITIONS. (a) In this subchapter:
16	16	(1) "Female" means an individual who self-identifies
17	17	the individual's gender as female.
18	18	(2) "Governing authority" has the meaning assigned by
19	19	Section 1.002.
20	20	(3) "Headquarters" means:
21	21	(A) with respect to a publicly traded
22	22	corporation, the location listed on the corporation's most recent
23	23	Form 10-K filed with the Securities and Exchange Commission; and
24	24	(B) with respect to a for-profit entity that is
25	25	not a publicly traded corporation, the location of the entity's
26	26	principal office.
27	27	(4) "Publicly traded corporation" means a corporation
28	28	that has a class or series of the corporation's voting shares
29	29	qualified for trading on a national securities exchange.
30	30	(5) "Qualifying business" means a for-profit entity
31	31	that is formed under the laws of or has its headquarters located in
32	32	this state and that is either:
33	33	(A) a publicly traded corporation; or
34	34	(B) a corporation, limited liability company, or
35	35	other business organization, however organized, that generates
36	36	annual revenue of more than $20 million.
37	37	Sec. 3.116. COMPOSITION OF GOVERNING AUTHORITY FOR CERTAIN
38	38	BUSINESS ENTITIES: FEMALE REPRESENTATION REQUIRED. (a) This
39	39	section does not apply to a qualifying business that has one owner.
40	40	(b) A qualifying business must have at least one member on
41	41	the business's governing authority who is female.
42	42	(c) A qualifying business is considered to be in compliance
43	43	with Subsection (b) if, for at least six months during a calendar
44	44	year, the business has at least one member who is female on the
45	45	business's governing authority.
46	46	Sec. 3.117. NOTICE OF VIOLATION. The secretary of state
47	47	shall provide notice of a violation of Section 3.116(b) to each
48	48	qualifying business that violates that subsection not later than
49	49	January 31 of the year following the calendar year in which the
50	50	violation occurred.
51	51	Sec. 3.118. ADMINISTRATIVE PENALTY FOR VIOLATION OF
52	52	GOVERNING AUTHORITY COMPOSITION REQUIREMENTS. (a) Except as
53	53	provided by Subsection (d), the secretary of state may impose an
54	54	administrative penalty on a qualifying business that violates
55	55	Section 3.116(b). The penalty may be in an amount not to exceed
56	56	$100,000 for each violation.
57	57	(b) The amount of an administrative penalty imposed under
58	58	this section must be based on:
59	59	(1) the history of any previous violations;
60	60	(2) the amount necessary to deter future violations;
61	61	and
62	62	(3) efforts to correct the violation.
63	63	(c) An administrative penalty collected under this section
64	64	shall be remitted to the comptroller for deposit in the general
65	65	revenue fund.
66	66	(d) The secretary of state may not impose an administrative
67	67	penalty on a qualifying business under this section if the business
68	68	has at least one member of the business's governing authority who is
69	69	female before the 61st day following the date a notice of violation
70	70	under Section 3.117 was provided.
71	71	Sec. 3.119. PUBLIC REPORT ON COMPLIANCE. Not later than
72	72	June 1 of each year, the secretary of state shall publish on the
73	73	secretary of state's Internet website a report regarding the
74	74	compliance of qualifying businesses with Section 3.116(b) during
75	75	the preceding calendar year. The report must include:
76	76	(1) the number of qualifying businesses that were in
77	77	compliance with Section 3.116(b) at any time during the preceding
78	78	calendar year; and
79	79	(2) the number of entities that were subject to the
80	80	requirements of that section at any time during the preceding
81	81	calendar year but are no longer subject to that section because the
82	82	entity is no longer considered a qualifying business.
83	83	Sec. 3.120. RULES. The secretary of state may adopt rules
84	84	necessary to implement this subchapter.
85	85	SECTION 2. Section 11.251(b), Business Organizations Code,
86	86	is amended to read as follows:
87	87	(b) The secretary of state may terminate a filing entity's
88	88	existence if the secretary finds that:
89	89	(1) the entity has failed to, and, before the 91st day
90	90	after the date notice was mailed has not corrected the entity's
91	91	failure to:
92	92	(A) file a report within the period required by
93	93	law or pay a fee or penalty prescribed by law when due and payable;
94	94	or
95	95	(B) maintain a registered agent or registered
96	96	office in this state as required by law; [or]
97	97	(2) the entity has failed to, and, before the 16th day
98	98	after the date notice was mailed has not corrected the entity's
99	99	failure to, pay a fee required in connection with the filing of its
100	100	certificate of formation, or payment of the fee was dishonored when
101	101	presented by the state for payment; or
102	102	(3) the entity violated Section 3.116(b), and, before
103	103	the 61st day after the date notice of the violation was provided as
104	104	required by Section 3.117, the entity has not corrected the
105	105	entity's failure to comply with Section 3.116(b).
106	106	SECTION 3. The secretary of state is required to publish the
107	107	initial report required by Section 3.119, Business Organizations
108	108	Code, as added by this Act, not later than June 1, 2021.
109	109	SECTION 4. A qualifying business, as defined by Section
110	110	3.115, Business Organizations Code, as added by this Act, must
111	111	comply with Section 3.116(b), Business Organizations Code, as added
112	112	by this Act, beginning with the 2020 calendar year.
113	113	SECTION 5. This Act takes effect September 1, 2019.