Whether you are starting a small business or running an established company, it is vital to understand business laws and regulations. But that is easier said than done. My goal is to provide business-related legal services so that you can spend more time dealing with the actual business and less time with legal intricacies of operating your business. My services include:

Business formation

You have a new and innovative product or service and you are interested in forming a new business. You may have concerns about liability, taxes, investors and other considerations. As your small business lawyers, we will assist you in deciding whether your startup business should organize as a limited liability company (LLC), partnership, S corporation or C corporation. We will form the most appropriate business organization for your new business and register the business in all jurisdictions in which it will conduct business.

Mergers and acquisitions

If your business is fortunate to thrive and become a merger or acquisition target, we can represent you as the seller; or if you are on the other side and looking to acquire a business, we can assist with the due diligence in purchasing a business. We will review various approaches in purchasing a business through merger or acquisition. We will discuss with you various structures in purchasing the stock or purchasing the assets of an acquisition target. In either case, your business will need thoughtful and comprehensive representation in all aspects of a merger or acquisition.

Government contracting

Government contractors face numerous issues when contracting with the government. And with a hands-on approach and substantial experience, we will help you navigate those legal issues. We prepare teaming agreements, subcontracts and joint venture agreements and can handle a variety of other government contract matters. As government contract lawyers for your small business, we can assist you in applying for programs for HUBZones, service-disabled veteran-owned small businesses or women-owned businesses. If your company is facing debarment or suspension because of allegations of corruption or bribery, we can assist in your defense before the U.S. government or the World Bank.

Business transactions

Once you have an ongoing business, however organized, you will have a host of various commercial transactions. We prepare agreements with lenders, lessors, partners, customers, employees, and consultants. We provide business legal services for your company, preparing confidentiality agreements, nondisclosure agreements, licensing agreements, distribution, employment agreements, independent contractor agreements, lease agreements, and many others. We will help you understand what each part of these agreements require and make sure that these agreements provide protection to you and your business.

Corporate law

Once your startup business has been created, your company will have ongoing requirements to maintain its separate status. We will assist in guiding you on how to prepare corporate minutes or resolutions of the company to maintain the corporate form and other steps to protect the limited liability of your company. You will also have to make sure that your bylaws or operating agreement continues to reflect the needs of the business organization. We are available to assist you in addressing these issues. And once your company is ready to raise additional capital from investors, we can work with you to determine whether you are subject to securities laws or fall within one of the exemptions.

Business disputes

Few businesses are immune to business disputes. If your small business was well-advised, you have an agreement that will provide guideposts on how to resolve your business dispute. If you are unable to settle your dispute, you may have a dispute resolution mechanism such as mediation or arbitration in the agreement. An alternative dispute resolution mechanism such as arbitration or mediation generally can provide a relatively quick resolution of your business dispute. If not, then you may have to consider litigation. We handle business disputes, including pre-litigation matters, mediation, arbitration and litigation.

Anti-corruption compliance

Every company should have procedures and policies to minimize its exposure to allegations of corruption or bribery. An integrity compliance program (ICP) is essential for businesses doing work internationally for the United States government or work financed through one of the development banks. We can assist in reviewing or preparing an ICP to assure that is consistent with the anti-bribery and anti-corruption guidelines from the World Bank. If your company is facing debarment or suspension because of allegations of corruption or bribery, we can assist in your defense before the U.S. government or the World Bank.

Non-profit law

We work with organizations to obtain their tax exempt status under Section 501(c)(3) of the Internal Revenue Code. There have been recent changes to obtaining 501(c)(3) status and we have worked with organizations in submitting successful applications on the simplified track by filing a 1023-EZ and the more rigorous 1023 application for larger organizations. Nonprofits also face similar legal challenges to assure that they comply with business requirements and additional requirements to assure that they do not jeopardize their tax exempt status. As a law firm for nonprofits, we work with nonprofit organizations to guide them through these issues.

FAQ Small Business Attorney in DC

What is considered a small business?

Almost all our clients fall within the definition of small business/startup as determined by the Office of Advocacy of the U.S. Small Business Administration. Under this definition, a small business has fewer than 500 employees. Small businesses encompass about 99.9% of all business organizations in the United States.

Which industries do you serve as a small business attorney?

Most of our clients are service providers such as consulting companies, law firms, accounting and bookkeeping services, cybersecurity consultants, video production companies, and lobbyists, just to name a few. We also represent foreign and domestic manufacturers and software developers.

As a small business lawyer in DC, we represent some retail operations, such as bookstores and restaurants. We also represent numerous nonprofits with varying missions. Our government contractors clients hold various IDIQs (Indefinite Delivery, Indefinite quantity Contracts) and GSA schedules.

In which areas of the law does a small business or startup need legal assistance?

Most times, small businesses/startups need the services of outside general counsel. As outside general counsel for small businesses, we can handle most matters as a small business attorney that small businesses generally encounter. Usually, anything with the word agreement or contract is within our practice areas. This includes operating and shareholder agreements, which are used for small businesses and startups that are formalizing their relationships with their owners. Once a business is formed, then we prepare and review a host of other agreements, such as service agreements (which may be referred to as client agreements or consulting agreements), independent contractor agreements (which may be referred to as subcontracting agreements), employment agreements, teaming agreements, purchase and sale agreements, merger agreements, option agreements, license agreements, lease agreements, and the list goes on.

What factors should a small business and startup look for in retaining the services of a lawyer for small businesses?

With our extensive experience of working as a small business attorney in DC for decades now, background and experience should come right at the top of the list when looking for a small business lawyer. We think that accessibility and communication are essential for a successful relationship between an attorney and a client. Hourly rate is important but not as important as quality of service.

What kind of experience do you have in advising small businesses as an attorney?

Keith Rosten has not only legal experience but also business and practical experience that allows him to relate to the trials and tribulations of a small business owner. Keith has BigLaw experience before working for small and medium-sized businesses, first at his own law firm focused on small businesses and then with Berliner Corcoran & Rowe LLP.

Keith has substantial business experience. He received an MBA from the Tuck School at Dartmouth College. During his business studies, he worked on several group projects with small businesses, including a furniture manufacturer, a manufacturer of leak location precision equipment, real estate developer. After business school, Keith operated a successful real estate business in California and overcame numerous issues, such as asbestos abatement and underground storage tank remediation.

Keith worked as a legal adviser to a government contractor and was a legal adviser to a major initiative in Russia. Keith ran another small business, selling and marketing solar energy equipment. The business had an e-tailer component, hosted the largest solar energy forum online, and sold solar energy equipment to the government. Keith negotiated two GSA schedules for the business and obtained HUBZone certification for the business. Keith was also president of the Dartmouth Entrepreneurial Network – Washington, a networking organization for small businesses in the greater Washington, DC community.

Keith has also volunteered for Compass Pro Bono, working with local business professionals to conduct long-term consulting engagements for local nonprofits in fundraising, governance, and strategy.

With this breadth of legal and business experience, Keith is attuned to some of the challenges facing small businesses, which allows him to provide effective advice and guidance.

As a small business lawyer, do you take in-person meetings only?

Yes. We are located in downtown Washington DC and host many of our clients. For those clients who cannot come into our offices, we usually meet over Zoom or by telephone.

How do you charge for your services as a small business attorney?

We charge our clients based on hourly fees. We usually provide a budget of how much certain matters cost so that startups and small businesses know in advance the ballpark cost of the matter.

What if a client does not like our services?

Clients can terminate our services anytime if they don’t find it satisfactory.

Should my small business lawyer or startup lawyer be in the same state as me?

No, not always necessary and may depend on multiple factors. For example, though we are an expert small business lawyer in DC, we have also provided consultation to other cities’ clients.

Mikhail Strogalev © 123RF.com

Foreign Businesses Doing Business in the United States

Despite the challenges, foreign businesses continue to flock to the United States. This article gives an overview of the major decisions that foreign businesses must make as they explore entering the U.S. market.

Most foreign companies may establish a U.S. subsidiary or register as a foreign legal entity

In many other countries, branch offices have their own special legal status. Not so in the United States. It is possible to register your foreign legal entity in the United States. Registration of a foreign legal entity is rarely done for several reasons.

It is very easy to set up a separate legal entity in the United States—as much time and money as registering a foreign business. If you are going to go through all of the trouble to set up business in the United States, it is very little additional cost to set up a separate entity as your “representative office.”

Many times, the foreign business does not want to subject itself to the jurisdiction of U.S. courts. Setting up an office without any insulation from liability could expose the assets of the entire company.

Similarly, without a separate legal entity, the assets of the foreign entity’s entire worldwide operations are subject to levy in the event of a judgment against the company.

Finally, direct ownership of a U.S. business may potentially subject a foreign corporation to branch profits tax.

For these reasons, it would be highly unusual for a company wanting to set up a presence in the United States not to form a separate legal entity. You may want to consult with a startup lawyer who can guide you through your choices.

Foreign companies can choose to set up as a corporation or limited liability company

Although there are several different kinds of legal entities, the most common choice for a foreign business is to choose between a corporation or a limited liability company.

The corporation is the traditional structure. Corporations have rigid requirements. They have an annual shareholders’ meeting at which the shareholders elect a board of directors. The corporation is governed by a set of rules and policies known as bylaws.

The board of directors in turn provide the overall policy for the company and appoint the officers. Shares of a corporation are generally freely transferable unless there are separate side agreements such as a shareholders’ agreement.

Related article: Corporate Law for Startups

The limited liability company (LLC) is a relatively recent arrival in the United States. The LLC is much less formal. The members of the LLC are the owners of the LLC and sometimes have management responsibilities. The LLC can mirror the structure of a corporation, but can also assume the structure of a general partnership in which all of the members are responsible for the operations of the business.

The LLC can also be structured as a limited partnership in which one of the members is responsible as the manager of the business and the other members are “silent” or passive investors.

The first LLC was created in 1977 but now has become the legal entity of choice for most businesses, small and large, because of its flexibility. In Delaware for example, last year in 2019, there were 45,000 corporations created. By contrast, 165,000 LLCs or close to four times as many limited liability companies as corporations were created in Delaware.

A foreign company may select either a corporation or LLC, but as domestic companies, most foreign companies choose to set up business in the United States as a LLC.

Related articles:

Forming a New Business: Corporations vs LLCs
Choice of Entity Considerations in the Aftermath of Tax Reform

Tax burden on corporations eases

If a foreign business sets up as a corporation, the business is taxed as a corporation. Because of the significant reduction in corporate taxes enacted into law under The Tax Cuts and Jobs Act of 2017, the top corporate income tax rate now sits at 21 percent, down from 35 percent

If the foreign business sets up as a LLC, then it gets to choose how it wants to be taxed either as a corporation or as a pass through entity such as a sole proprietorship or partnership. This may get confusing because the entity is a LLC, but the LLC can be taxed as a corporation. How can that be, you may ask? The LLC is not a taxable entity so it gets to choose its own tax treatment.

You can form the new business in any one of the 50 states or the District of Columbia

The United States are divided into 50 states and the District of Columbia. Since corporate law is based on the state in which the entity is formed, the foreign business needs to take some time to decide in which jurisdiction to form the company.

Foreign businesses like U.S. businesses often choose Delaware, a small state on the Eastern seaboard. Delaware has been at the forefront of corporate law in the United States. It has developed corporate expertise over the decades and a stable legal regime. And it has a special court for corporate matters, the Court of Chancery. Most states have courts of general jurisdiction in which the same judge may hear both criminal and civil matters. Having a special court has made Delaware attractive to many businesses.

Formation in Delaware does not mean that the company has to do business in Delaware. Indeed, most businesses that form in Delaware are doing business in some other state. Once the business is formed in Delaware, the business then needs to register in every state in which it is doing business. The company can only have one state of organization but numerous states in which it is doing business.

You may need a CFIUS review

Any time that a foreign business has a transaction in the United States, it has to think about whether CFIUS applies. Before recent amendments, greenfield investments, starting a new company were not subject to CFIUS. With recent amendments, real estate ventures may still come within the ambit of CFIUS.

If the business is expanding in the United States by merging or acquiring a new business, it should consult with a CFIUS lawyer to determine whether it should make a CFIUS filing.

Commencing operations for your new business

Commencing operations for your new business is usually simple. You open a bank account, register with the tax authorities and get a business license. But for foreign businesses there may be an extra hurdle. To open a bank account and file taxes, the business needs an employer identification number (EIN).

An individual who has a social security number can readily be the “responsible person” necessary to obtain a EIN, but if there are no U.S. employees or others willing to be the responsible person, then one of the foreign founders will have to apply to obtain a special designating number. Instead of a five minute application, it can take 6-8 weeks or even longer to obtain an EIN.

And then you need to find a bank who is willing to take your money. This usually want not an issue, but with the new know your customer requirements, some banks may require additional information for you to open a bank account.

Once the entity is created and has a EIN, then it prepares a tax return just like any other U.S. company. The taxes it pays depends on the tax treatment of the entity.

Immigration considerations may influence the foreign investor

Some foreign investors have additional considerations in establishing a U.S. presence, such as immigration. If they have a minimum of $900,000 to invest, they may want to look into the EB-5 Immigrant Investor Program.

The threshold question for others is whether you are interested a non-immigrant visa or an immigrant visa. If a foreign business is simply exploring the U.S. market for opportunities, then you may be interested in a B-1 temporary business visitor visa. You are not eligible to work in the United States, but you are allowed to stay in the U.S. for a maximum of six months.

You may also be eligible for an E treaty visa if you are coming from one of the countries with which the U.S. has a treaty, such as Australia, Armenia, Kazakhstan or Turkey. If you are from one of the countries, you are engaged in substantial trade or developing and directing the operations of an enterprise in which you have invested a substantial amount of capital, you may be eligible for a Treaty Trader (E-1) and Treaty Investor (E-2) visa. Note that some countries are limited to one category or the other and other countries have both categories, depending on the treat.

And finally, if you are interested in having your employees to come to the United States to work for your company as part of an intracompany transfer, you may want to apply for a L-1 visa. The L-1 authorizes a qualified employee of your company, such as a manager or executive or an employee with specialized to be allowed to work and live in the United States.

Easy to start a business in the U.S.

In general, the United states is very favorable country in which to do business. It has low corporate rates and it is easy to form a company. And of course it is a large market–a very large market that is hard to ignore.