A Certificate of Good Standing (also known as a Certificate of Status, a Certificate of Existence, or a Certificate of Fact) demonstrates that your company has submitted all required reports and paid all required fees/taxes to the state, therefore verifying its existence in that state.

Issued by the state authorities, the document is evidence that your company is legally permitted to conduct business activities as a properly registered company within that particular state. However, it is important to note that the Certificate of Good Standing is not a business license, which is in fact required to be obtained in order to legally conduct business. Usually, a company can legally conduct business without obtaining a Certificate of Good Standing. A Certificate of Good Standing verifies that:

• The company exists in that state’s records.
• It is currently authorized to do business in that state.
• The company is current with all fees, taxes and other filings.
• Occasionally, the following institutions will require a Certificate of Good Standing:
• State authorities, especially for foreign qualification applications
• Local jurisdictions (for the renewal of licenses)
• Banks
• Potential investors

Please note that the Certificate of Good Standing is not for unlimited time. It usually expires when annual documents and fees are due. Moreover, each state requires different time of validity for foreign qualification.