Setting up a Business in Oklahoma
Oklahoma has one of the fastest growing economies in the US, which makes it an appealing choice for foreign investors looking to expand their business empires.
The Sooner State is a major producer of natural gas, oil and agriculture and relies on an economic base of aviation, energy, telecommunications and biotechnology.
Geographically, Oklahoma is surrounded by Texas from the Southern side, New Mexico from West, Kansas & Colorado from North and Missouri & Arkansas from the Eastern side. The state is spread over a total area of 112,335 square miles, of which 110,246 square miles are land area and 2,088 square miles are water. Oklahoma has a 1,577 mile long border. The state is 463 miles long in its east-west direction and 290 miles long in its north-south direction.
The main types of company formation in Oklahoma are:
Sole Proprietorship
This is a default form of business for a single owner. Nothing needs to be filed with the Secretary of State. A Sole Proprietorship is sometimes called “doing business as”. This company form is easy to set up but the owner is fully liable for all the debts of the business. This form of business ownership is generally not advisable for businesses of any significant size or businesses that have potential liability exposure.
General Partnership (GP)
This is a default form of business with two or more owners. A trade name needs to be filed if the business operates under a name other than the names of its legal owners. Like Sole Proprietorships, General Partnerships are easy to set up. This form of business is generally not advisable for most situations however; a Limited Partnership (LP), Limited Liability Partnership (LLP), or a Limited Liability Company (LLC) might be a more advantageous business form.
Limited Partnership (LP) and Limited Liability Partnership (LLP)
These are both formed by filing a Certificate of Limited Partnership or a Limited Liability Partnership Statement of Qualification. Both entities require at least two owners. Again it is advised to consider alternative forms, i.e. an LLC or Corporation, which may be better suited.
Limited Liability Company (LLC)
LLCs are formed by filing Articles of Organisation with the Secretary of State. LLCs can provide their owner with limited liability. An LLC in Oklahoma can have one or more members. An LLC is a very flexible management structure, with company owners directly operating the company. On the other end of the spectrum, an LLC operating agreement can have a corporate like management structure with a Board of Directors, an executive team and committees.
Corporation
Corporations are formed by filing Articles of incorporation with the Secretary of State. Corporations are the most formal business entity in Oklahoma. A single shareholder is permitted but Corporations are required to have a Board of Directors which adopts rules for the Corporation and hires an executive team.