SACRAMENTO-Today, Assemblyman Curt Hagman’s (R-Chino Hills) AB 434, which will ease burdens on businesses by revising outdated language in California’s Corporations Code, was signed into law by Governor Jerry Brown.
“I am extremely pleased to have the Governor’s signature on this important bill,” stated Assemblyman Hagman. “Now that AB 434 is law, our state’s business owners can focus on running their businesses without having to deal with the frustrating back-and-forth that has resulted from inconsistencies in the Code,” Hagman continued.
In 2011, Assemblyman Curt Hagman’s AB 571 was signed into law by Governor Jerry Brown. This measure updated California’s Corporation’s Code, which was developed in the 1970s. The archaic accounting tools created barriers for a variety of business models which increased the difficulty of doing business in California. AB 571 corrected this problem by allowing businesses to use a more streamlined and modern approach to deal with company dividends and distributions of shares. However, the changes enacted by AB 571 were never made to the text of California’s Corporations Code. As a result, documents filed by businesses with the Secretary of State were being rejected because they included language with references to code sections that were nonexistent or incorrect. Under AB 434, the Corporations Code will now accurately reflect changes made by AB 571.