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CALIFORNIA CORPORATE & SECURITIES LAW

Will Your Corporation Be Required To Designate A “Corporate Law Enforcement Contact”?

Before seeing AB 1993 (Irwin), I had not come across the concept of a “corporate law enforcement contact”.  The bill, which was introduced last month, doesn’t exactly say what a corporate law enforcement contact’s responsibilities might be, but it does require California’s Attorney General to establish minimal qualifications for the position by July 1, 2017.  Since these qualifications are to include “a requirement that the contact have continual availability and authority to make decisions regarding warrants and the disclosure of information and data”, I’m inferring that the point of the legislation is to help law enforcement enforce search warrants.  The bill also adds a new Section 1502.7 to the Corporations Code requiring corporations to file with the Secretary of State a statement identifying its corporate law enforcement contact.  The Secretary of State would be required to provide this list to the Attorney General who would be authorized to hand the list out to local law enforcement agencies.  The list, however, would not be subject to disclosure under the California Public Records Act.

Not all corporations would be subject to the requirement, only those corporations that generates customer data for 1,000,000 or more people annually from any of the following: data searches, geolocation data, or social media, as defined in Section 980 of the Labor Code.  The application of the act to foreign corporations, a term defined in Section 171 of the Corporations Code, is unclear.  As proposed, Section 1502.7 refers only to corporations, a term defined in Section 162 of the Corporations Code, and not foreign corporations.  However, the requirement that corporations designate corporate law enforcement contacts would be included in a new Penal Code section.  The General Corporation Law’s definition of “corporation” does not necessarily apply to the Penal Code.

More on “or more”

It may seem to my readers that I’ve been perseverating of late on “or more”.  In this post, I noted that AB 1722 (Wagner) appeared to require a vote of exactly 50% of the voting interests of a limited liability company for dissolution.  I’m therefore pleased to report that Assemblymember Wagner amended AB 1722 on Monday to add the words “or more” to the required vote.  I guessing that the SEC would like Congress to do the same in Section 12(g)(1)(A) of the Securities Exchange Act of 1934.

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