House Bill 248 Alabama 2026 Session

Summary

Primary Sponsor

David FaulknerRepresentative

Republican

Session

2026 Regular Session

Title

Alabama Business and Nonprofit Entities Code. revisions made to clarify procedures, make technical corrections, and codify common law

Summary

HB248 would revise the Alabama Business and Nonprofit Entities Code to clarify internal affairs, codify common law, and add new rules on filings, records access, and corporate opportunities.

What This Bill Does

It updates the code to clarify how entities are formed and governed, and it codifies certain common-law concepts about internal affairs. It creates a new process to correct or nullify filing instruments and requires registered agents to have a physical office (not a virtual arrangement), plus rules for foreign entities withdrawing their authority to do business in Alabama. It strengthens records-access rights with expedited court review, expands proxy and forum provisions for corporations and nonprofits, and adds Division G on corporate opportunities with safe harbors for fiduciaries.

Who It Affects

• Group 1: Stockholders, directors, officers, and members of Alabama business corporations and nonprofit corporations—these groups would see clarified duties, expanded rights to access records, new safe harbors for conflicts of interest and corporate opportunities, and changes to proxy and forum provisions.
• Group 2: Domestic and foreign filing entities (and their registered agents and offices) operating in Alabama—these groups would face new filing correction rules, a ban on virtual registered agents (must have a physical office), and withdrawal/termination procedures for foreign entities, along with changes to name reservation and related filing processes.

Key Provisions

• Codifies common law and clarifies the internal affairs doctrine.
• Adds a procedure to correct or nullify filing instruments (certificate of correction and certificate of nullification) with defined steps and court involvement.
• Requires registered agents to have a physical office in Alabama and prohibits performing duties solely virtually.
• Provides rules for foreign entities withdrawing their certificate of authority, including required notices and tax clearance.
• Clarifies proxy matters and forum selection provisions for business and nonprofit corporations.
• Strengthens records-access rights with expedited court review, including redaction and confidentiality controls and potential court-ordered costs.
• Introduces Division G on corporate opportunities, including definitions of related terms and safe harbors for fiduciaries in corporate opportunity scenarios.
• Repeals and seamlessly integrates former provisions 10A-2A-16.10 and 10A-3A-4.20 into new sections 10A-2A-16.02–16.04 and 10A-3A-4.02–04.04.

AI-generated summary using openai/gpt-5-nano on Feb 11, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Businesses & Financial Institutions