ARIZONA STATE SENATE
Phoenix, Arizona
corporations; annual report;
penalties
Purpose
Authorizes the Arizona
Corporation Commission (Commission) to waive penalties assessed against
corporations for a late filing of an annual report due to reasonable cause.
Background
Current statute requires the
Commission to collect annual reports from corporations doing business in
Arizona. Pursuant to ARS section
10-1622, the Commission is required to assess penalties against corporations.
This penalty is 20 percent of the report filing fee of $45 for each month the
report is late ($9.00 per month).
According to the Commission,
it has been common practice by the agency to waive penalties if certain
conditions exist, such as Commission staff errors in adding or updating a
mailing address. The Commission states
it will not waive penalties if the corporation violated the Arizona
Constitution and state corporation laws because it failed to: have a statutory
agent and/or proper agent address; maintain a known place of business; or file
an annual report or respond to an official notice of delinquency.
S.B. 1135 allows the
Commission to waive penalties assessed against corporations for a late filing
due to reasonable cause.
According to the Commission,
the fiscal impact of this legislation could result in a loss of approximately
$1.8 million dollars to the state general fund in FY 2001-2002.
1. Allows, instead of requires, the Commission to assess penalties against corporations on a late filing of annual reports.
2. Allows the Commission, on written application by the corporation, to abate a penalty assessed against the corporation if it determines that the conduct, or lack of conduct, causing the penalty was due to reasonable cause, as determined by the Commission, and not to willful neglect.
3. Makes a technical change.
4. Provides for a general effective date.
Amendments Adopted by the Commerce Committee
1. Allows the Commission to waive penalties on the premise of reasonable cause instead of making it mandatory that they do so.
2. Removes language prohibiting the Commission from assessing a penalty for a late filing against a corporation if the corporation applied for a waiver of a possible penalty prior to the assessment.
3. Permits the Commission to determine what reasonable cause is.
Senate Action
COM 1/31/01 DPA 6-0-0-0
Pepared by Senate Staff
February 2, 2001