In March 2017, the Corporate Counsel of the Corporation Law Section of the Delaware State Bar Association introduced a 43-page draft bill that would amend the Delaware General Corporation Law (DGCL) to, among other things, facilitate Delaware corporations’ use of blockchain technology to keep corporate records and communicate with stockholders.
The proposed legislation would achieve the first end by specifying that the ledger that corporations are required to maintain as evidence of their stockholders’ identities may be “administered by or on [the corporation’s] behalf” as opposed to “maintained by the corporation,” as the legislation currently provides. In this way, the proposed legislation would clarify that a corporation does not need to have its ledger maintained by an individual such as a corporate officer or transfer agent.
The draft bill would further make blockchain technology an option for Delaware corporations’ use in maintaining corporate records by clarifying that corporate records may be kept on “one or more electronic networks or databases (including one or more distributed electronic networks or databases).”
To enable Delaware corporations to use blockchain technology to communicate with stockholders, the proposed legislation would amend the DGCL to clarify that the written notices required by certain sections of that law may be sent via “electronic transmission,” and that an “electronic transmission” can include “one or more distributed electronic networks or databases.”
If the proposed legislation is approved, it would be enacted by August 2017.
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