Delaware Cryptocurrency Laws
Regulation of Digital Currencies: Cryptocurrency, Bitcoins, Blockchain Technology
| Delaware | SB 89 Signed by governor 6/19/19, Chapter 46 |
This bill continues the practice of amending periodically the Delaware Revised Uniform Limited Partnership Act (the “Act”) to keep it current and to maintain its national preeminence. Section 1. This section amends §17-101 of the Act in several respects. New definitions are added for “document” and “electronic transmission,” which terms appear in new §17-113 among other places in the Act. Section 4. This section amends §§17-104(d) and 17-104(e) of the Act to include references to protected series and registered series, as appropriate, and §Section 17-104(g) to conform with the addition of the defined term “electronic transmission” in §17-101. Section 7. This section adds new §17-113 of the Act, which establishes non-exclusive, safe harbor methods to reduce certain acts or transactions to a written or electronic document and to sign and deliver a document manually or electronically. The terminology in §17-113(a) is based on analogous provisions in existing §§17-302(e) and 17-405(d) of the Act, the Delaware Uniform Electronic Transactions Act (“UETA”), and the Model Business Corporation Act, with modifications. Section 17-113(a) permits limited partnership transactions (such as entering into agreements of merger not filed with the secretary of state) to be documented, signed, and delivered through “Docusign” and similar electronic means. The §17-113(a) safe harbor provisions apply solely for purposes of determining whether an act or transaction has been documented and whether a document has been signed and delivered, in accordance with the Act and the partnership agreement. Section 17-113(a) does not preempt any statute of frauds or other law that might require actions be documented, or that documents be signed and delivered, in a specified manner. Section 17-113(a) clarifies how its provisions operate in connection with a transaction conducted pursuant to UETA. To the extent UETA does not apply to a transaction (under §12A-103 of UETA) because the transaction is governed by the Act, the parties to the transaction can satisfy the Act by complying with §17-113(a). Section 17-113(b) addresses certain actions and documents that are not governed by §17-113(a). There is no presumption that these excluded items are prohibited from being effected by electronic or other means, but §17-113 may not be relied on as a basis for documenting an act or transaction, or signing or delivering a document if the exclusions set forth in §17-113(b) apply. Certain of these excluded items are governed by separate provisions that facilitate the use of electronic media, including documents filed with the secretary of state (governed by §17-206(a)). Section 17-113(b) permits partnership agreement provisions that restrict the use of §17-113(a), but those restrictions must be expressly stated. A provision merely specifying that an act or transaction will be documented in writing, or that a document will be signed or delivered manually, will not prohibit the application of §17-113(a). Section 17-113(c) addresses the interaction between the provisions of the Act and the Electronic Signatures in Global and National Commerce Act (the “E-Sign Act”). Section 17-113(c) evidences an intent to allow the Act to govern the documentation of actions, and the signature and delivery of documents, to the fullest extent the Act is not preempted by the E-Sign Act. Sections 23 and 24. These sections amend §17-302(e) and §17-405(d) of the Act to conform with the addition of the defined term “electronic transmission” in §17-101. |
| Delaware | SB 90 Signed by governor 6/19/19, Chapter 47 |
This bill continues the practice of amending periodically the Delaware Revised Uniform Partnership Act (the “Act”) to keep it current and to maintain its national preeminence. Section 1. This section amends §15-101 of the Act to include definitions for “document” and “electronic transmission.” These terms appear in new §15-124 among other places in the Act. “Electronic transmission” previously was defined in §15-407(d) of the Act, and the new definition provides specific statutory authority for Delaware partnerships to use networks of electronic databases (examples of which are described currently as “distributed ledgers” or a “blockchain”) for “electronic transmissions.” Section 4. This section adds new §15-124 of the Act, which establishes non-exclusive, safe harbor methods to reduce certain acts or transactions to a written or electronic document and to sign and deliver a document manually or electronically. The terminology in §15-124(a) is based on analogous provisions in existing §15-407(d) of the Act, the Delaware Uniform Electronic Transactions Act (“UETA”), and the Model Business Corporation Act, with modifications. Section 15-124(a) permits partnership transactions (such as entering into agreements of merger not filed with the secretary of state) to be documented, signed and delivered through “Docusign” and similar electronic means. The §15-124(a) safe harbor provisions apply solely for purposes of determining whether an act or transaction has been documented, and whether a document has been signed and delivered, in accordance with the Act and the partnership agreement. Section 15-124(a) does not preempt any statute of frauds or other law that might require actions be documented, or that documents be signed and delivered, in a specified manner. Section 15-124(a) clarifies how its provisions operate in connection with a transaction conducted pursuant to UETA. To the extent UETA does not apply to a transaction (under Section 12A-103 of UETA) because the transaction is governed by the Act, the parties to the transaction can satisfy the Act by complying with §15-124(a). Section 15-124(b) addresses certain actions and documents that are not governed by §15-124(a). There is no presumption that these excluded items are prohibited from being effected by electronic or other means, but §15-124 may not be relied on as a basis for documenting an act or transaction, or signing or delivering a document, if the exclusions set forth in §15-124(b) apply. Certain of these excluded items are governed by separate provisions that facilitate the use of electronic media, including documents filed with the secretary of state (governed by §15-105(c)). Section 15-124(b) permits partnership agreement provisions that restrict the use of §15-124(a), but those restrictions must be expressly stated. A provision merely specifying that an act or transaction will be documented in writing, or that a document will be signed or delivered manually, will not prohibit the application of §15-124(a). Section 15-124(c) addresses the interaction between the provisions of the Act and the Electronic Signatures in Global and National Commerce Act (the “E-Sign Act”). Section 15-124(c) evidences an intent to allow the Act to govern the documentation of actions, and the signature and delivery of documents, to the fullest extent the Act is not preempted by the E-Sign Act. Section 5. This section amends §§15-403(c) of the Act to provide specific statutory authority for Delaware partnerships to use networks of electronic databases (examples of which are described currently as “distributed ledgers” or a “blockchain”) for the creation and maintenance of partnership records. Section 6. This section amends §15-407(d) of the Act to conform with the addition of the defined term “electronic transmission” in §15-101. |
| Delaware | SB 91 Signed by governor 6/19/19, Chapter 48 |
This bill continues the practice of amending periodically the Delaware Limited Liability Company Act (the “Act”) to keep it current and to maintain its national preeminence. Section 1. This section amends §18-101 of the Act to include definitions for “document” and “electronic transmission,” and to amend the definitions of “manager” and “member.” The terms “document” and “electronic transmission” appear in new §18-113 among other places in the Act. The changes to the definition of “manager” confirm that the term includes a manager of the limited liability company generally and a manager associated with a series of the limited liability company, and the changes to the definition of “member” confirm that the term includes a member of the limited liability company generally and a member associated with a series of the limited liability company. Section 3. This section amends §18-104(g) to conform with the addition of the defined term “electronic transmission” in §18-101. Section 4. This section adds new §18-113 of the Act, which establishes non-exclusive, safe harbor methods to reduce certain acts or transactions to a written or electronic document and to sign and deliver a document manually or electronically. The terminology in §18-113(a) is based on analogous provisions in existing §§18-302(d) and 18-404(d) of the Act, the Delaware Uniform Electronic Transactions Act (“UETA”), and the Model Business Corporation Act, with modifications. Section 18-113(a) permits limited liability company transactions (such as entering into agreements of merger not filed with the secretary of state) to be documented, signed, and delivered through “Docusign” and similar electronic means. The §18-113(a) safe harbor provisions apply solely for purposes of determining whether an act or transaction has been documented and whether a document has been signed and delivered, in accordance with the Act and the limited liability company agreement. Section 18-113(a) does not preempt any statute of frauds or other law that might require actions to be documented, or that documents be signed and delivered, in a specified manner. Section 18-113(a) clarifies how its provisions operate in connection with a transaction conducted pursuant to UETA. To the extent UETA does not apply to a transaction (under §12A-103 of UETA) because the transaction is governed by the Act, the parties to the transaction can satisfy the Act by complying with §18-113(a). Section 18-113(b) addresses certain actions and documents that are not governed by §18-113(a). There is no presumption that these excluded items are prohibited from being effected by electronic or other means, but §18-113 may not be relied on as a basis for documenting an act or transaction or signing or delivering a document if the exclusions set forth in §18-113(b) apply. Certain of these excluded items are governed by separate provisions that facilitate the use of electronic media, including documents filed with the secretary of state (governed by §18-206(a)). Section 18-113(b) permits limited liability company agreement provisions that restrict the use of §18-113(a), but those restrictions must be expressly stated. A provision merely specifying that an act or transaction will be documented in writing, or that a document will be signed or delivered manually, will not prohibit the application of §18-113(a). Section 18-113(c) addresses the interaction between the provisions of the Act and the Electronic Signatures in Global and National Commerce Act (the “E-Sign Act”). Section 18-113(c) evidences an intent to allow the Act to govern the documentation of actions, and the signature and delivery of documents, to the fullest extent the Act is not preempted by the E-Sign Act. Section 5. This section amends §18-206(b) of the Act to clarify that the certificate of formation or certificate of registered series, as applicable, shall be amended, corrected or restated upon the filing of a certificate of the amendment (or judicial decree of amendment), certificate of correction, corrected certificate or restated certificate, and to confirm that a certificate of registered series is canceled upon a certificate of conversion of such registered series to protected series becoming effective. Section 6. This section amends §18-210 of the Act to provide that a plan of division may provide for contractual appraisal rights and that contractual appraisal rights may be made available in connection with any merger or consolidation in which a registered series is a constituent party, any division of the limited liability company, any conversion of a protected series to a registered series of the limited liability company, and any conversion of a registered series to a protected series of the limited liability company. Sections 14 and 15. These sections amend §§18-302(d) and 18-404(d) of the Act to conform with the addition of the defined term “electronic transmission” in §18-101. |
Blockchain Information & Resources:
- Anti-Collusion | What Is Obfuscation?
- Blockchain Attacks: Is No One Safe in the World of Cryptocurrencies?
- Blockchain Technology Explained: What is Blockchain and How Does It Work?
- Digital Currency Transmission Laws and Regulations by State
- Hard and Soft Forks: A Detailed and Simplified Explanation of How Blockchains Evolved
- Legal Issues around Cryptocurrency
- Merkle Trees
- Permissioned and Permissionless Blockchains
See More Information on Blockchain
Is cryptocurrency legal in Delaware?
Have Cryptocurrency or Blockchain issues or questions?
Freeman Law is dedicated to staying at the forefront as these emerging technologies continue to revolutionize social and economic activities. Contact Freeman Law to schedule a consultation or call (214) 984-3410 to discuss your cryptocurrency and blockchain technology concerns.
