MarylandHB 09962026 Regular SessionHouse

Corporations and Associations - Revisions

Sponsored By: Marlon Amprey (Democratic)

Signed by Governor

Corporations and AssociationsAssessments and Taxation, Department ofAssociations -see also- Cooperative AssociationsCommerce and Business -see also- ElectrComm; ForeignTr; etc.Corporations -see also- Municipal Corps; Public Corps & InstElectronic DocumentsElectronic GovernmentNoticesPartnershipsPenalties and Sentences -see also- Death PenaltyPostal Service

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 2 benefits, 0 costs, 3 mixed.

Easier Court Access, Fewer Registration Penalties

Beginning October 1, 2026, people claiming rights through an out-of-state corporation are no longer barred from Maryland courts because it failed to register. Officers and agents also no longer face the related misdemeanor or fine of up to $1,000. The corporation's existing $200 penalty remains, with reduction or cancellation allowed under state tax law. To sue, the corporation must show it paid the applicable penalty. It must also show that it or its out-of-state corporate successor registered, or that neither continues doing business in Maryland.

Investment Company Boards Can Skip Meetings

Beginning October 1, 2026, qualifying Maryland open-end investment company boards and committees can act without meetings, unless their charter says otherwise. Unlike the usual unanimous written-consent rule, this option allows majority consent under the federal Investment Company Act of 1940. Consent must follow that Act's voting and delivery rules and be filed with the minutes. It must reach all directors or committee members within 3 days after the action takes effect. A director who did not consent has 10 days after receiving notice to file a written dissent. Future-dated director consents can take effect no more than 60 days after delivery, including on stated conditions. The director must remain in office and must not revoke consent before it takes effect.

Businesses Keep Filing Dates After Corrections

Beginning October 1, 2026, Maryland's State Department of Assessments and Taxation must explain why it rejects a charter document. A corrected document keeps its original filing date if accepted within 30 days after the department mails the rejection notice. The department cannot record covered documents until all required filing, recording, organization, capitalization, and special fees are paid. Electronic filings remain subject to regular and expedited processing fees. The department can also review documents before formal filing, with applicable fees paid, and set rules for that review.

Bankruptcy Actions Can Bypass Shareholder Votes

Beginning October 1, 2026, a final federal bankruptcy order binding on stockholders allows corporate action without their approval. The board or a court-appointed trustee or receiver can change governing documents, transfer assets, dissolve the corporation, or carry out other necessary actions. A trustee or receiver can bypass board approval only when the final order authorizes it. This authority ends when a final decree closes the case and discharges the trustee or receiver; earlier actions remain valid. Required charter filings must identify the bankruptcy court, case docket, final order, and who approved the action. A trustee or receiver can sign and acknowledge those filings for the corporation without additional signatures or affidavits.

Partners Set Rules Within Legal Limits

Beginning October 1, 2026, general partnership agreements govern how they can be changed; state rules fill gaps. Agreements cannot eliminate loyalty or good-faith duties, unreasonably reduce care duties, or unreasonably limit access to records. They also cannot override protected departure, expulsion, winding-up, third-party, or limited-liability-partnership rules. Permitted loyalty exceptions require the specified disclosure and consent or approval process. Limited partnership agreements can create partner classes, including future senior classes, and set voting rights and procedures. The limited partnership is bound by and can enforce its agreement without separately agreeing, and anyone becoming a partner is treated as agreeing. Initial partners can agree that their agreement takes effect when the partnership forms. Unless the agreement says otherwise, all partners must approve amendments; required outside approvals and conditions must also be satisfied.

Sponsors & Cosponsors

Sponsor

Marlon Amprey
Democratic • House

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 178 • No: 0

Senate vote • 4/13/2026

Third Reading Passed

Yes: 45 • No: 0 • Other: 2

House vote • 3/12/2026