Rhode Island Corporate Bylaws
Rhode Island corporate bylaws outline a company’s organizational structure and establish policies to help the company handle important issues. This legal document will act as a corporation’s guide when appointing new officers or directors, scheduling shareholder or board meetings, distributing stock, voting, handling conflicts of interest, and even amending the bylaws themselves.
Unlike the Rhode Island Articles of Incorporation, your corporate bylaws do not need to be filed with the Rhode Island Secretary of State. Instead, they are kept with your corporation’s records. Bylaws are essential for Rhode Island corporations, even if they aren’t the easiest to create. This is why Northwest provides a free, attorney-drafted corporate bylaws template specific to Rhode Island corporations.
Why do I need corporate bylaws?
Rhode Island does not require corporations to file their bylaws with the Secretary of State, but they are legally recognized and important. Here’s why:
1. Corporate bylaws establish the rules and roles within your corporation.
While the state of Rhode Island does not require corporations to create bylaws, there are requirements if you do decide to create bylaws for your Rhode Island corporation. Per RI Gen L § 7-1.2-203, your bylaws must be adopted by the corporation’s incorporators or the board of directors at the organizational meeting.
Your bylaws will include guidelines for your company, like how many directors and officers the corporation will have and what their responsibilities will be, how voting will work, and how meetings will be organized, planned, and held. If you face an internal dispute, the policies in your corporate bylaws will be the first thing you consult.
2. Corporate bylaws prove that your business is a legitimate corporation.
Creating corporate bylaws is a way to establish your corporation as a valid business. For example, in order to open a corporate bank account (something you’ll need to have in order to maintain your limited liability status), the bank will want to see your bylaws. If you’re ever served with a lawsuit, showing that your corporation adheres to its bylaws can help you maintain your limited liability.
Look at creating bylaws as a way to show potential investors and other interested parties that your company has checked all the right legal boxes.
Does Rhode Island require corporate bylaws?
No. Rhode Island does not require corporations to create bylaws or file them with the state. However, the state does require that if a corporation will have bylaws, they must be adopted by the incorporators or the board of directors at the organizational meeting. RI Gen L § 7-1.2-203 also gives both the shareholders and the board of directors the power to amend bylaws, but the shareholders can vote to change any amendments made by the board of directors.
What is included in Rhode Island Corporate Bylaws?
Rhode Island corporate bylaws need to include policies for important issues your corporation might face. Everything from voting procedure to management structure to company finances should be considered when creating your bylaws. You can include anything in your bylaws that’s legal in Rhode Island, but these are some topics you’ll definitely want to cover:
- Meetings
- Stock
- Directors and officers
- Finances
- Records
- Amendments and emergencies
Who prepares the bylaws?
Typically the board of directors will prepare the bylaws and adopt them at the corporation’s first organizational meeting, but Rhode Island state law allows for the incorporators to do this, too. Northwest can help you get started with our free, attorney-drafted corporate bylaws template, custom-made for Rhode Island corporations.
Are corporate bylaws legally binding?
Yes. Directors, officers, and shareholders are legally bound by corporate bylaws. This is why you should consider every possibility in your bylaws, because violating any bylaw procedures or rules could affect your corporation’s limited liability status or have other negative legal consequences.
FAQs
Are bylaws filed with the state of Rhode Island?
No. Rhode Island does not require corporations to file their bylaws with the state. Instead, they are compiled in an internal document that you’ll keep with other company records like your meetings minutes, resolutions, and other important company documents.
Do bylaws need to be signed?
Not technically. Your corporation can still adopt bylaws legally without including signatures, but here at Northwest we recommend that all directors and officers sign your bylaws. Why? It shows that everyone involved in the corporation is aware and agrees with the policies.
How do I amend my bylaws in Rhode Island?
Usually the bylaws themselves will lay out how to make an amendment. For example, you might have a bylaw that establishes who gets to vote (shareholders or directors) and the number of votes required to approve an amendment.
Rhode Island law (RI Gen L § 7-1.2-203) states that bylaws can be amended by your corporation’s shareholders, but they can also be amended by the board of directors if established in the corporation’s articles of incorporation or bylaws. However, the shareholders have the power to change any amendment by the board of directors.