Activities Not Requiring Certificate of Qualification
[i] In General
Foreign corporations are expressly permitted to conduct certain activities without having to obtain a certificate of qualification for transacting intrastate business. First, a foreign corporation is not considered to be transacting intrastate business merely because its subsidiary transacts intrastate business [Corp. Code § 191(b)]. For most purposes, such a foreign “parent” corporation would normally possess more than 50 percent of the voting power directly or indirectly through one or more of its subsidiaries [Corp. Code § 189(a); see Corp. Code §§ 189(b), 703]. Further, a foreign corporation is not considered to be transacting intrastate business merely because of its status as any one or more of the following [Corp. Code § 191(b)]:
•A shareholder of a domestic corporation.
•A shareholder of a foreign corporation transacting intrastate business.
•A limited partner of a domestic limited partnership.
•A limited partner of a foreign limited partnership transacting intrastate business.
•A member or manager of a domestic limited liability company.
•A member or manager of a foreign limited liability company transacting intrastate business.
A foreign corporation also is not considered to be transacting intrastate business solely because it carries on in California any one or more of the following activities, which are generally attributable to interstate corporate activities [Corp. Code § 191(c);:
•Maintaining, defending, or settling any action, suit, administrative or arbitration proceeding, or settling any other claim or dispute.
•Holding meetings of its board or shareholders or carrying on other activities concerning its internal affairs.
•Maintaining bank accounts.
•Maintaining offices or agencies for the transfer, exchange, and registration of its securities or depositaries with relation to its securities.
•Effecting sales through independent contractors.
•Soliciting or procuring orders by mail, through employees or agents, or otherwise, if those orders require acceptance outside of California before becoming binding contracts.
•Creating evidences of debt, mortgages, liens, or security interests on real or personal property.
•Conducting an isolated transaction that is completed within a period of 180 days and is not in a course of repeated transactions of a like nature.
Activities other than those enumerated above may also be activities that do not constitute “transacting intrastate business” [see Corp. Code § 191(c); see e.g., United Systems of Arkansas, Inc. v. Stamison (1998) 63 Cal. App. 4th 1001, 1007, 74 Cal. Rptr. 2d 407 (simply submitting bid in response to request for quotation by DMV was not “transacting intrastate business”; out-of-state bidder could maintain its suit challenging award of contract to another bidder without obtaining certificate of qualification from Secretary of State)].