What’s a Registered Agent’s role?

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A registered agent is a specific individual assigned to send and receive a variety of legal documents for a business entity. Business laws vary somewhat from location to location, but the general registered agent role is fairly typical in most places, including jurisdictions in the United States, Canada, United Kingdom, and Australia. If a business is a party to a lawsuit, the service of process, summons, claim, response, and other legal documents will normally be sent to the registered agent, who is responsible for alerting business owners to the documents. In other cases, she is responsible for part of the annual upkeep of the business. For example, she may be responsible for reminding business partners to file annual reports, taxes or other annual documents with the appropriate state or federal agencies.

Depending on the size of the business, a number of people may be acceptable candidates for a registered agent position. If the company is owned and operated by only one person, that person can act as the registered agent. If the company is small and owned by a few people, one of these owners or one of the shareholders, employees, partners or members can also act as an agent. Some commercial entities are much larger. In these cases, an external third party, usually at a law firm or service company, may be the best option for the agent position – although an internal member of the company can be used.

There are several benefits to designating a third party to act as an agent. For example, the registered agent’s name and address are publicly listed in all legal documents, including documents setting up the business entity. By hiring a third party, this gives business owners some sort of public anonymity and keeps workplace gossip to a minimum. For example, employees may wonder why a legal summons is being sent to a business owner, where those same employees would not be aware of any legal process if the summons is sent to an external address. In addition, most third-party agents have detailed filing systems that keep companies informed of filing deadlines, thus preventing the accumulation of late fees.

If a registered agent fails to perform its duties, it can be unfortunate for the business entity. For example, if a lawsuit is filed against the company and the owner is not informed of the lawsuit in a timely manner, the plaintiff may win the case by default. Additionally, many jurisdictions have penalties for companies that do not have an agent. In some cases, failure to retain an agent could mean that the company’s legal status could be revoked or stiff fees could be assessed.

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