Certificate of Good Standing: Why Your Business Needs One

Owning a business is no easy feat; apart from day to day operations, the legal side of owning a business can be confusing and daunting. Laws differ by state, with businesses requiring different paperwork and certificates in order to operate legally and successfully. One of the major components of operating a business legally is a Certificate of Good Standing, also known as a Certificate of Existence, or Certificate of Authorization. In this blog, we’ll explain what a Certificate of Good Standing is, how to get one and what it means for your business and others that want to do business with you.

What Is a Certificate of Good Standing?

A Certificate of Good Standing is a legal document issued by a state’s government that certifies that a business is legally valid to do business in its state of operation. It also provides verification and assurance to other businesses and individuals wishing to do business with your company that your organization is certified by the state.

Why Does My Business Need a Certificate of Good Standing?

A Certificate of Good Standing is usually issued for small businesses and limited liability corporations (LLC) that wish to apply for foreign qualification. Foreign qualification is when a business wishes to open a new location, relocate an existing location or do business in another state. If your business is located in Pennsylvania but was filed as a New Jersey entity, Pennsylvania would require a Certificate of Good Standing to prove it is in compliance with New Jersey law. Financial institutions also frequently require a Certificate of Good Standing before considering financing a business entity.

A Certificate of Good Standing can be used if your business wishes to open a bank account, receive financing, form a foreign entity in another state or if the business is being sold. It can also be required to prove re-compliance with tax or state rules and regulations after failing to do so.

How Do I Get a Certificate of Good Standing?

A Certificate of Good Standing is issued by the Secretary of State after a few conditions are met:

  • Your business is registered as a legal entity in your state
  • Your business is not in default of corporate rules
  • Your business is not currently suspended by the state
  • Taxes and other financial obligations are in good standing prior to application


If a business entity meets all these criteria, it can apply for a Certificate of Good Standing directly with the state, or use a third party for filing at an additional fee.

It may also be necessary at some point to check that a business entity has a Certificate of Good Standing to verify its existence and trustworthiness. Certified public search services are the cost-convenient way to check the standing certificate of a business entity if the need arises.

Have questions or need assistance about Certificates of Good Standing? Consult with the most trusted public search service in the industry today.