Why Do We Suggest Using Texas Companies and Trusts?
Texas:
- has advanced pro-business corporate statutes and regulations,
- has a dynamic economy,
- has a spirit of rugged individualism, and
- offers Privacy and advanced Asset Protection.
When considering whether or not to form a company, one of the most important decisions
is "where" to form it. Traditionally, Delaware has been the jurisdiction
of choice. The most commonly stated reason is that, "Delaware law is
more mature and developed." This may have been the case 50 years ago,
but is no longer the case. Delaware law is primarily defined by court
cases, and no longer has any real advantage over other states. In many
cases it has a real disadvantage since it involves subjecting a business
to often vague and unclear court rulings. Over the past 25 years, the
Texas Legislature has committed itself to codifying Texas business law, and
has made great efforts to simplify and clarify Texas business law to be more
business friendly. The commitment of the Texas Legislature to resolve
important business issues by statute rather than by lawsuit is a significant
advantage.
Another significant advantage of Texas is size. Texas is one of the
largest states in the USA in both land mass and population. In 2003,
the populations of Texas reached 22,118,509. Texas has a large, vibrant and
broad based economy. Texas Gross State Product (GSP) is estimate to
be $924.55 billion US dollars for 2005. If Texas was an independent
nation, it would be one of the richest and most prosperous in the world.
There are more operating businesses in existence in Texas than perhaps anywhere
else on earth.
Texas is pro Business. Texans pride themselves on a reputation of "rugged
individualism" and do not believe that the government should get involved
in anything other than the most basic of issues. There is no income
tax in Texas. Businesses face a much lower level of regulation than in other
states. Texas is a "right to work" state which means it does not tolerate
actions by unions or businesses that interfere with the right of an individual
to work where and when he or she wants to work. Annual reporting requirements
for companies are minimal. Most importantly, Texas and Texans have an attitude
that is open to new ideas and change, and is open to outsiders. There
is a saying in Texas: "I may not have been born here, but I got here
as soon as I could!"
Texas laws and business climate also promote Privacy and Asset Protection.
As stated before the Texas Legislature is pro business, particularly
when it comes to enacting laws that allow individuals and businesses to limit
their liabilities and to protect their assets. Texas does not require
companies to disclose the names of individual shareholders, and never requires
disclosure of individual tax identification numbers. Another perhaps
more subtle issue has to do with environment and atmosphere; and perhaps
a certain amount of philosophy. When trying to obtain privacy there
are only two real options: invisibility and camouflage. Invisibility, such
as when you attempt to obtain total anonymity, poses real problems. Imagine
you saw a car driving down the street, but the driver was invisible. You
would be more likely to remember that particular vehicle BECAUSE of the invisibility
of the driver. Invisibility such as this may not be appropriate since it
tends to attract attention. Camouflage on the other hand is a natural process.
It is the method that most creatures use to survive: blending in with their
surroundings. In Texas it is easy to obtain privacy through "corporate
camouflage" due to the large number of companies in existence, the many and
varied businesses that trade in Texas, the exposure to international trade
and cultures, and the numerous business transactions that take place daily.
There is nothing wrong with obtaining such privacy. It simply
involves establishing your business interests in such a way that draws little
or no attention to yourself, and avoids unnecessary disclosure of private
information to parties that have no legitimate right to the information.
