Texas House Bill HB3364

Texas 2021 - 87th Regular

Caption

Relating to business entities.

Impact

The impact of HB3364 on state law is significant as it enhances the regulatory framework governing business entities in Texas. By adding provisions such as the option for entities to designate a specific court for internal claims, the bill seeks to optimize dispute resolution processes. This change is expected to foster a more predictable legal environment for businesses, thus potentially encouraging economic growth and stability. The bill also addresses the procedures for company formation, allowing businesses to adopt modern practices in establishing themselves legally and operationally.

Summary

House Bill 3364 aims to amend various sections of the Business Organizations Code in Texas to clarify definitions and streamline processes regarding business entities, particularly focusing on limited liability companies (LLCs) and partnerships. The bill provides clearer definitions of terms like 'general partner' and 'limited partner', ensuring that the roles and responsibilities of individuals in these entities are explicitly stated according to the governing documents and the code. This amendment is critical for reinforcing the framework within which business entities operate in Texas.

Contention

While many business advocates support HB3364 for its potential to simplify legal processes and enhance business operations, some critics may argue that the changes could limit the flexibility of governance that different types of business entities historically enjoyed. Concerns may arise regarding how the bill's provisions could restrict local governmental authority in shaping laws that pertain to business operations within their jurisdictions. Additional debate may center around the increased centralization of jurisdictional control over internal disputes which some may view as an encroachment on local governance.