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A BILL TO BE ENTITLED
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AN ACT
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relating to the reasonable relation of qualified transactions to |
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particular jurisdictions. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 271.004, Business and Commerce Code, is |
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amended to read as follows: |
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Sec. 271.004. DETERMINATION OF REASONABLE RELATION OF |
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TRANSACTION TO PARTICULAR JURISDICTION. (a) For purposes of this |
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chapter, a transaction bears a reasonable relation to a particular |
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jurisdiction if the transaction, the subject matter of the |
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transaction, or a party to the transaction is reasonably related to |
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that jurisdiction. |
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(b) A transaction bears a reasonable relation to a
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particular jurisdiction if Transactions bearing a reasonable |
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relation to a particular jurisdiction include those in which: |
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(1) a party to the transaction is a resident of that |
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jurisdiction; |
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(2) a party to the transaction has the party's place of |
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business or, if that party has more than one place of business, the |
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party's chief executive office or an office from which the party |
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conducts a substantial part of the negotiations relating to the |
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transaction, in that jurisdiction; |
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(3) all or part of the subject matter of the |
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transaction is located in that jurisdiction; |
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(4) a party to the transaction is required to perform |
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in that jurisdiction a substantial part of the party's obligations |
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relating to the transaction, such as delivering payments; or
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(5) a substantial part of the negotiations relating to |
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the transaction occurred in or from that jurisdiction and an |
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agreement relating to the transaction was signed in that |
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jurisdiction by a party to the transaction; |
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(6) all or part of the subject matter of the |
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transaction relates to the governing documents or internal affairs |
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of an entity formed under the laws of that jurisdiction, such as |
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matters relating to rights or obligations with respect to that |
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entity's membership or ownership interests, including agreements |
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among members or owners, agreements or options to acquire |
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membership or ownership interests, and debt or other securities |
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convertible into ownership interests; or |
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(7) all of the following are true: (A) all or part of |
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the subject matter of the transaction is a loan or other extension |
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of credit in which a party lends, advances, borrows, or receives, or |
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is obligated to lend or advance, or is entitled to borrow or |
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receive, funds or credit with an aggregate value of at least |
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$25,000,000, (B) there are at least three financial institutions or |
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other lenders or providers of credit party to the transaction, (C) a |
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party to the transaction has more than one place of business and has |
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an office in that particular jurisdiction, and (D) that particular |
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jurisdiction is part of the United States. |
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(c) If a transaction bears a reasonable relation to a |
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jurisdiction at the time that the parties enter into the |
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transaction, then the transaction continues to bear a reasonable |
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relation to that jurisdiction regardless of any subsequent change |
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in facts or circumstances with respect to the transaction, the |
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subject matter of the transaction, or any party to the transaction |
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and regardless of any modification, amendment, renewal, extension, |
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or restatement of any agreement relating to the transaction. |
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SECTION 2. This Act takes effect September 1, 2011. |