1-1     By:  Sibley                                           S.B. No. 1323
 1-2           (In the Senate - Filed March 8, 2001; March 8, 2001, read
 1-3     first time and referred to Committee on Business and Commerce;
 1-4     March 15, 2001, reported adversely, with favorable Committee
 1-5     Substitute by the following vote:  Yeas 7, Nays 0; March 15, 2001,
 1-6     sent to printer.)
 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 1323                  By:  Sibley
 1-8                            A BILL TO BE ENTITLED
 1-9                                   AN ACT
1-10     relating to the recognition of certain foreign partnerships,
1-11     associations, and other entities and the enforcement of related
1-12     rights and obligations.
1-13           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-14           SECTION 1.  Section 9.07, Texas Revised Limited Partnership
1-15     Act (Article 6132a-1, Vernon's Texas Civil Statutes), is amended to
1-16     read as follows:
1-17           Sec. 9.07.  TRANSACTING BUSINESS WITHOUT REGISTRATION.
1-18     (a)  A foreign limited partnership transacting business in Texas
1-19     may not maintain an action, suit, or proceeding in Texas until it
1-20     has registered in Texas and paid to the secretary of state all
1-21     amounts owing under Subsection (d) of this section.
1-22           (b)  The failure of a foreign limited partnership or a
1-23     foreign general partnership to register in Texas does not impair:
1-24                 (1)  the validity of any contract or act of the foreign
1-25     limited partnership;
1-26                 (2)  the right of any other party to the contract to
1-27     maintain any action, suit, or proceeding on the contract; or
1-28                 (3)  defense by the foreign limited partnership of any
1-29     action, suit, or proceeding in any Texas court.
1-30           (c)  A limited partner of a foreign limited partnership is
1-31     not liable as a general partner of the foreign limited partnership
1-32     solely because the limited partnership transacted business in Texas
1-33     without registration.
1-34           (d)  A foreign limited partnership transacting business in
1-35     Texas without first having registered shall pay to the secretary of
1-36     state an amount equal to the fee for registration that would have
1-37     been imposed on the foreign limited partnership had it registered
1-38     as required by Section 9.02 of this Act, plus $500 [$750] for each
1-39     year or part of a year during which it transacted business in Texas
1-40     without having registered.
1-41           SECTION 2.  Section 10.03, Texas Revised Partnership Act
1-42     (Article 6132b-10.03, Vernon's Texas Civil Statutes), is amended by
1-43     adding Subsection (d) to read as follows:
1-44           (d)  A foreign limited liability partnership transacting
1-45     business in Texas without being registered in Texas shall pay to
1-46     the secretary of state an amount equal to the total amounts owing
1-47     under Section 10.02 of this Act plus $500 for each year or part of
1-48     a year during which the partnership transacted business in Texas
1-49     without being registered.
1-50           SECTION 3.  Section A, Article 8.01, Texas Non-Profit
1-51     Corporation Act (Article 1396-8.01, Vernon's Texas Civil Statutes),
1-52     is amended to read as follows:
1-53           A.  No foreign corporations shall have the right to conduct
1-54     affairs in this State until it shall have procured a certificate of
1-55     authority so to do from the Secretary of State.  No foreign
1-56     corporation shall be entitled to procure a certificate of authority
1-57     under this Act if members of the foreign corporation would be
1-58     ineligible to organize a corporation under the laws of this State
1-59     or if the foreign corporation is to conduct in this State any
1-60     affairs which a corporation organized under the laws of this State
1-61     is not permitted to conduct or which are against the public policy
1-62     of this State.  A foreign corporation shall not be denied a
1-63     certificate of authority by reason of the fact that the laws of the
1-64     state or country under which such corporation is organized
 2-1     governing its organization and internal affairs differ from the
 2-2     laws of this State, and nothing in this Act contained shall be
 2-3     construed to authorized this State to regulate the organization of
 2-4     such corporation, or its internal affairs not intrastate in Texas.
 2-5           SECTION 4.  Subchapter D, Chapter 35, Business & Commerce
 2-6     Code, is amended by adding Section 35.49 to read as follows:
 2-7           Sec. 35.49.  PROHIBITED OUT-OF-STATE OBLIGATIONS.  Except as
 2-8     otherwise provided in Sections 35.51(b)-(e), a legal right or
 2-9     obligation between parties, including nonbusiness entities, arising
2-10     from an agreement, or other arrangement or legal relationship,
2-11     entered into in another state or under another state's laws may not
2-12     be enforced in this state if entering into the agreement,
2-13     arrangement, or relationship would violate the law or the public
2-14     policy of this state.
2-15           SECTION 5.  This Act takes effect immediately if it receives
2-16     a vote of two-thirds of all the members elected to each house, as
2-17     provided by Section 39, Article III, Texas Constitution.  If this
2-18     Act does not receive the vote necessary for immediate effect, this
2-19     Act takes effect on the 91st day after the last day of the
2-20     legislative session.
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