Pennsylvania Certificate of Authority · Do I need one?
Do you need a certificate of authority to operate in Pennsylvania?
The quickest test: if your entity does regular, local business in Pennsylvania, it needs authority, which costs $250; if everything it does there falls under one of the 12 exempt activities, it does not. The Department of State leaves the decision to the entity.
The rule
Before doing business in Pennsylvania a foreign filing association, or a foreign limited liability partnership, has to register with the Department of State. The statute separately lists what does not count, and 12 items appear on that list.
The exempt activities
The exempt activities are: defending, settling, mediating or arbitrating a case; internal affairs such as meetings of interest holders or governors; bank accounts; offices or trustees that handle the association's own securities; sales through independent contractors; taking orders that need acceptance outside the state; creating debts, mortgages or security interests; collecting debts and enforcing security, with holding and maintaining the property taken; one isolated deal that is not part of a pattern; interstate commerce; acquiring, owning, holding, leasing as lessee, conveying or transferring real or personal property without more; and good-faith disaster or emergency response work. The list is not exhaustive.
What counts instead
The Department says conduct more regular, systematic or extensive than the listed activities is doing business. Its examples of typical conduct are maintaining an office to conduct local intrastate business, selling personal property that is not in interstate commerce, entering into contracts relating to local business or sales, and owning or using real estate for general purposes. Owning real estate passively, for investment, does not make an entity a local business.
Quick answers
| What the entity does in Pennsylvania | Needs authority? |
|---|---|
| Only defends or settles a lawsuit | No, exempt |
| Only keeps a bank account | No, exempt |
| Only sells via independent distributors | No, exempt |
| Only takes orders that are accepted outside the state | No, exempt |
| Only holds a rental building as an investment | No, passive ownership |
| Runs an office, shop or branch | Yes, local business |
| Hires staff to carry on its ordinary business | Regular activity in the state, the typical case for registering |
| Does one isolated job that is not part of a pattern | No, if truly isolated |
The answers are the Department's guidance in short form.
Interest holders and holding companies
An entity that merely owns an interest in a foreign association operating in Pennsylvania is not doing business here by that alone. The operating association is the one that registers.
Why a list of exemptions and not a definition
Pennsylvania chose to describe what is outside the rule instead of defining what is inside it. That makes the exempt list the main tool: if each thing your entity does in the state is on the list, you are outside the rule, and if something is not, the Department's description of regular local business is the next thing to compare it with.
Tax is a separate matter
Authority and tax follow different tests. According to the Department the exemptions leave other Pennsylvania laws on service, tax and regulation untouched; a registered association will generally face suit and state tax, whereas a taxable one need not be registered. On sales tax, the Department points to economic nexus for a business that sold $100,000 or more into the state in the previous twelve months, and it says Corporate Tax Reports are required once gross sales into the Commonwealth reach $500,000. Revenue Department guidance covers both.
Scenarios that come up
A software company with no Pennsylvania office, whose online orders are accepted at its home base, sits on the exempt side. A contractor from Maryland that crews a six-month road job in Bedford County has more than an isolated deal. A manufacturer with a stocked Pennsylvania warehouse and local shipments is doing the sort of local business the Department describes. A holding company that owns shares in a Pennsylvania operating company is protected by the interest-holder rule, though the operating company is not. A nonprofit that runs a recurring program in the state is a local activity too.
What to do when the answer is unclear
Compare your Pennsylvania activity with the exempt list and with the Department's description of local business. If you are unsure, registering costs $250 and removes the question for the future.
If you need it and have not filed
The statute attaches a court-access consequence: an unregistered entity doing business here cannot bring an action in Pennsylvania until it registers. It keeps its contracts and its defenses. The fix is the ordinary $250 filing, which costs the same for every entity type and takes effect on filing or on a later date and hour you choose. Registering lifts the bar on starting a lawsuit from the filing date, not before, and an unregistered entity keeps answering any suit brought against it. A Pennsylvania business lawyer can tell you whether past activity crossed the line.
Do-I-need-one questions
Do I need authority to sell online to Pennsylvania buyers?
Orders that are accepted outside the state are exempt. A local presence or regular local business changes the picture.
Do I need it to buy a rental house here?
Holding one purely as an investment does not count as doing business.
Do I need it to open a bank account?
No. Banking is exempt.
Does an employee working from home in Pennsylvania trigger it?
Regular business carried on by staff in the state looks like local business, the typical case for registering.
Who decides?
The Department says the entity does.
Fees at a glance
Get Pennsylvania authority
+ $250 state fee
- Your Foreign Registration Statement, drafted from a short questionnaire
- The docketing statement filed alongside it
- A Pennsylvania registered office entry, ours or one you hold
- The filed copy sent back to you
- Renewal: after the first year, the agent service renews at $149 a year
$199
Pennsylvania
Get authority to operateThe $250 goes to the Department of State and appears on its own line. $199 plus the state fee, including your first year of registered agent service; after that the agent service renews at $149 a year.
Official sources
- Pennsylvania Department of State, fees and payments
- DSCB:15-412, Foreign Registration Statement, with instructions
- Pennsylvania Department of State, foreign associations
- Pennsylvania Department of State, annual reports
- Pennsylvania Department of State, commercial registered office providers
- Pennsylvania Department of State, general rule and exclusions for registration of foreign associations
- 15 Pa.C.S. 403, activities not constituting doing business
- 15 Pa.C.S. 411, registration to do business in this Commonwealth
Need to operate in Pennsylvania?
Tell us the entity type and we prepare the filing.