S T A T E O F N E W Y O R K
________________________________________________________________________
2932--A
2011-2012 Regular Sessions
I N S E N A T E
February 3, 2011
___________
Introduced by Sen. JOHNSON -- read twice and ordered printed, and when
printed to be committed to the Committee on Corporations, Authorities
and Commissions -- recommitted to the Committee on Corporations,
Authorities and Commissions in accordance with Senate Rule 6, sec. 8
-- committee discharged, bill amended, ordered reprinted as amended
and recommitted to said committee
AN ACT to amend the business corporation law, the limited liability
company law and the partnership law, in relation to authorizing
certain health care providers to form professional service entities
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Paragraph (a) of section 1503 of the business corporation
law, as amended by chapter 550 of the laws of 2011, is amended to read
as follows:
(a) Notwithstanding any other provision of law, one or more individ-
uals duly authorized by law to render the same professional service
within the state may organize, or cause to be organized, a professional
service corporation for pecuniary profit under this article for the
purpose of rendering the same professional service, [except] PROVIDED
that one or more individuals duly authorized by law to practice profes-
sional engineering, architecture, landscape architecture or land survey-
ing within the state may organize, or cause to be organized, a profes-
sional service corporation or a design professional service corporation
for pecuniary profit under this article for the purpose of rendering
such professional services as such individuals are authorized to prac-
tice, AND, FURTHER, PROVIDED THAT ONE OR MORE INDIVIDUALS DULY LICENSED
BY LAW TO PRACTICE MEDICINE AND WHO ARE CERTIFIED BY THE AMERICAN BOARD
OF OPHTHALMOLOGY, AND INDIVIDUALS LICENSED BY LAW TO PRACTICE OPTOMETRY
AND/OR OPHTHALMIC DISPENSING WITHIN THE STATE MAY ORGANIZE, OR CAUSE TO
BE ORGANIZED, A PROFESSIONAL SERVICE CORPORATION FOR PECUNIARY PROFIT
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01173-02-2
S. 2932--A 2
UNDER THIS ARTICLE FOR THE PURPOSE OF RENDERING PROFESSIONAL SERVICES AS
SUCH INDIVIDUALS ARE AUTHORIZED TO PRACTICE.
S 2. Section 1529 of the business corporation law, as amended by chap-
ter 576 of the laws of 1994, is amended to read as follows:
S 1529. Business corporation law applicable.
Except for the provisions of sections thirteen hundred three, thirteen
hundred four, thirteen hundred sixteen, thirteen hundred seventeen and
thirteen hundred twenty, this chapter shall be applicable to a foreign
professional service corporation to the extent that the provisions ther-
eof are not in conflict with the provisions of this article. A foreign
professional service corporation may practice in this state, or may
consolidate or merge with another corporation, or may be a member of a
professional service limited liability company, a foreign professional
service limited liability company, a registered limited liability part-
nership or foreign limited liability partnership, only if all of the
professions practiced by such corporations, limited liability companies
or limited liability partnerships could be practiced by a single profes-
sional service corporation organized in this state; and, further, only
if such foreign professional service corporation is domiciled in a state
or territory of the United States the laws of which, at the time of
application by such corporation under section fifteen hundred thirty of
this article, contain a reciprocal provision under which professional
service corporations domiciled in this state may similarly apply for the
privilege of doing business in any such state or territory[; provided
further however, that nothing herein].
(A) NOTHING IN THIS SECTION shall authorize a foreign professional
service corporation practicing professional engineering, land surveying,
architecture and/or landscape architecture to be a member or partner of
a professional service limited liability company, a foreign professional
service limited liability company, a registered limited liability part-
nership or a foreign limited liability partnership unless all of the
shareholders, directors and officers of such foreign professional
service corporation are licensed to practice one or more of such
professions in this state.
(B) NOTHING IN THIS SECTION SHALL AUTHORIZE A FOREIGN PROFESSIONAL
SERVICE CORPORATION ORGANIZED TO PRACTICE MEDICINE WITH OPTOMETRY AND/OR
OPHTHALMIC DISPENSING TO BE A MEMBER OR PARTNER OF A PROFESSIONAL
SERVICE LIMITED LIABILITY COMPANY, A FOREIGN PROFESSIONAL SERVICE LIMIT-
ED LIABILITY COMPANY, A REGISTERED LIMITED LIABILITY PARTNERSHIP OR A
FOREIGN LIMITED LIABILITY PARTNERSHIP UNLESS ALL OF THE SHAREHOLDERS,
DIRECTORS AND OFFICERS OF SUCH FOREIGN PROFESSIONAL SERVICE CORPORATION
ARE LICENSED TO PRACTICE ONE OR MORE OF SUCH PROFESSIONS IN THIS STATE;
PROVIDED, HOWEVER, THAT ANY SHAREHOLDER, DIRECTOR OR OFFICER LICENSED TO
PRACTICE MEDICINE IN THIS STATE SHALL ALSO BE CERTIFIED BY THE AMERICAN
BOARD OF OPHTHALMOLOGY.
S 3. Subdivision (a) of section 1203 of the limited liability company
law, as separately amended by chapters 420 and 676 of the laws of 2002,
is amended to read as follows:
(a) Notwithstanding the education law or any other provision of law,
one or more professionals each of whom is authorized by law to render a
professional service within the state, or one or more professionals, at
least one of whom is authorized by law to render a professional service
within the state, may form, or cause to be formed, a professional
service limited liability company for pecuniary profit under this arti-
cle for the purpose of rendering the professional service or services as
such professionals are authorized to practice. With respect to a profes-
S. 2932--A 3
sional service limited liability company formed to provide medical
services as such services are defined in article 131 of the education
law, each member of such limited liability company must be licensed
pursuant to article 131 of the education law to practice medicine in
this state; PROVIDED, HOWEVER, THAT WITH RESPECT TO A PROFESSIONAL
SERVICE LIMITED LIABILITY COMPANY FORMED TO PROVIDE MEDICAL SERVICES
DEFINED IN ARTICLE 131 OF THE EDUCATION LAW WITH SERVICES DEFINED IN
ARTICLE 143 AND/OR ARTICLE 144 OF THE EDUCATION LAW, EACH MEMBER OF SUCH
LIMITED LIABILITY COMPANY MUST BE LICENSED PURSUANT TO ARTICLE 131 AND
CERTIFIED BY THE AMERICAN BOARD OF OPHTHALMOLOGY, AND/OR LICENSED PURSU-
ANT TO ARTICLE 143 AND/OR ARTICLE 144 OF THE EDUCATION LAW TO PRACTICE
ONE OR MORE OF SUCH PROFESSIONS IN THIS STATE. With respect to a
professional service limited liability company formed to provide dental
services as such services are defined in article 133 of the education
law, each member of such limited liability company must be licensed
pursuant to article 133 of the education law to practice dentistry in
this state. With respect to a professional service limited liability
company formed to provide veterinary services as such services are
defined in article 135 of the education law, each member of such limited
liability company must be licensed pursuant to article 135 of the educa-
tion law to practice veterinary medicine in this state. With respect to
a professional service limited liability company formed to provide
professional engineering, land surveying, architectural and/or landscape
architectural services as such services are defined in article 145,
article 147 and article 148 of the education law, each member of such
limited liability company must be licensed pursuant to article 145,
article 147 and/or article 148 of the education law to practice one or
more of such professions in this state. With respect to a professional
service limited liability company formed to provide licensed clinical
social work services as such services are defined in article 154 of the
education law, each member of such limited liability company shall be
licensed pursuant to article 154 of the education law to practice
licensed clinical social work in this state. With respect to a profes-
sional service limited liability company formed to provide creative arts
therapy services as such services are defined in article 163 of the
education law, each member of such limited liability company must be
licensed pursuant to article 163 of the education law to practice crea-
tive arts therapy in this state. With respect to a professional service
limited liability company formed to provide marriage and family therapy
services as such services are defined in article 163 of the education
law, each member of such limited liability company must be licensed
pursuant to article 163 of the education law to practice marriage and
family therapy in this state. With respect to a professional service
limited liability company formed to provide mental health counseling
services as such services are defined in article 163 of the education
law, each member of such limited liability company must be licensed
pursuant to article 163 of the education law to practice mental health
counseling in this state. With respect to a professional service limited
liability company formed to provide psychoanalysis services as such
services are defined in article 163 of the education law, each member of
such limited liability company must be licensed pursuant to article 163
of the education law to practice psychoanalysis in this state. In addi-
tion to engaging in such profession or professions, a professional
service limited liability company may engage in any other business or
activities as to which a limited liability company may be formed under
section two hundred one of this chapter. Notwithstanding any other
S. 2932--A 4
provision of this section, a professional service limited liability
company (i) authorized to practice law may only engage in another
profession or business or activities or (ii) which is engaged in a
profession or other business or activities other than law may only
engage in the practice of law, to the extent not prohibited by any other
law of this state or any rule adopted by the appropriate appellate divi-
sion of the supreme court or the court of appeals.
S 4. Subdivision (b) of section 1207 of the limited liability company
law, as separately amended by chapters 420 and 676 of the laws of 2002,
is amended to read as follows:
(b) With respect to a professional service limited liability company
formed to provide medical services as such services are defined in arti-
cle 131 of the education law, each member of such limited liability
company must be licensed pursuant to article 131 of the education law to
practice medicine in this state; PROVIDED, HOWEVER, THAT WITH RESPECT TO
A PROFESSIONAL SERVICE LIMITED LIABILITY COMPANY FORMED TO PROVIDE
SERVICES DEFINED IN ARTICLE 131 OF THE EDUCATION LAW WITH SERVICES
DEFINED IN ARTICLE 143 AND/OR ARTICLE 144 OF THE EDUCATION LAW, EACH
MEMBER OF SUCH LIMITED LIABILITY COMPANY MUST BE LICENSED PURSUANT TO
ARTICLE 131 AND CERTIFIED BY THE AMERICAN BOARD OF OPHTHALMOLOGY, AND/OR
LICENSED PURSUANT TO ARTICLE 143 AND/OR ARTICLE 144 OF THE EDUCATION LAW
TO PRACTICE ONE OR MORE OF SUCH PROFESSIONS IN THIS STATE. With respect
to a professional service limited liability company formed to provide
dental services as such services are defined in article 133 of the
education law, each member of such limited liability company must be
licensed pursuant to article 133 of the education law to practice
dentistry in this state. With respect to a professional service limited
liability company formed to provide veterinary services as such services
are defined in article 135 of the education law, each member of such
limited liability company must be licensed pursuant to article 135 of
the education law to practice veterinary medicine in this state. With
respect to a professional service limited liability company formed to
provide professional engineering, land surveying, architectural and/or
landscape architectural services as such services are defined in article
145, article 147 and article 148 of the education law, each member of
such limited liability company must be licensed pursuant to article 145,
article 147 and/or article 148 of the education law to practice one or
more of such professions in this state. With respect to a professional
service limited liability company formed to provide licensed clinical
social work services as such services are defined in article 154 of the
education law, each member of such limited liability company shall be
licensed pursuant to article 154 of the education law to practice
licensed clinical social work in this state. With respect to a profes-
sional service limited liability company formed to provide creative arts
therapy services as such services are defined in article 163 of the
education law, each member of such limited liability company must be
licensed pursuant to article 163 of the education law to practice crea-
tive arts therapy in this state. With respect to a professional service
limited liability company formed to provide marriage and family therapy
services as such services are defined in article 163 of the education
law, each member of such limited liability company must be licensed
pursuant to article 163 of the education law to practice marriage and
family therapy in this state. With respect to a professional service
limited liability company formed to provide mental health counseling
services as such services are defined in article 163 of the education
law, each member of such limited liability company must be licensed
S. 2932--A 5
pursuant to article 163 of the education law to practice mental health
counseling in this state. With respect to a professional service limited
liability company formed to provide psychoanalysis services as such
services are defined in article 163 of the education law, each member of
such limited liability company must be licensed pursuant to article 163
of the education law to practice psychoanalysis in this state.
S 5. Subdivision (a) of section 1301 of the limited liability company
law, as separately amended by chapters 420 and 676 of the laws of 2002,
is amended to read as follows:
(a) "Foreign professional service limited liability company" means a
professional service limited liability company, whether or not denomi-
nated as such, organized under the laws of a jurisdiction other than
this state, (i) each of whose members and managers, if any, is a profes-
sional authorized by law to render a professional service within this
state and who is or has been engaged in the practice of such profession
in such professional service limited liability company or a predecessor
entity, or will engage in the practice of such profession in the profes-
sional service limited liability company within thirty days of the date
such professional becomes a member, or each of whose members and manag-
ers, if any, is a professional at least one of such members is author-
ized by law to render a professional service within this state and who
is or has been engaged in the practice of such profession in such
professional service limited liability company or a predecessor entity,
or will engage in the practice of such profession in the professional
service limited liability company within thirty days of the date such
professional becomes a member, or (ii) authorized by, or holding a
license, certificate, registration or permit issued by the licensing
authority pursuant to, the education law to render a professional
service within this state; except that all members and managers, if any,
of a foreign professional service limited liability company that
provides health services in this state shall be licensed in this state.
With respect to a foreign professional service limited liability company
which provides veterinary services as such services are defined in arti-
cle 135 of the education law, each member of such foreign professional
service limited liability company shall be licensed pursuant to article
135 of the education law to practice veterinary medicine. With respect
to a foreign professional service limited liability company which
provides medical services as such services are defined in article 131 of
the education law, each member of such foreign professional service
limited liability company must be licensed pursuant to article 131 of
the education law to practice medicine in this state; PROVIDED, HOWEVER,
THAT WITH RESPECT TO A FOREIGN PROFESSIONAL SERVICE LIMITED LIABILITY
COMPANY FORMED TO PROVIDE SERVICES DEFINED IN ARTICLE 131 OF THE EDUCA-
TION LAW WITH SERVICES DEFINED IN ARTICLE 143 AND/OR ARTICLE 144 OF THE
EDUCATION LAW, EACH MEMBER OF SUCH FOREIGN PROFESSIONAL SERVICE LIMITED
LIABILITY COMPANY MUST BE LICENSED PURSUANT TO ARTICLE 131 AND CERTIFIED
BY THE AMERICAN BOARD OF OPHTHALMOLOGY, AND/OR LICENSED PURSUANT TO
ARTICLE 143 AND/OR ARTICLE 144 OF THE EDUCATION LAW TO PRACTICE ONE OR
MORE OF SUCH PROFESSIONS IN THIS STATE. With respect to a foreign
professional service limited liability company which provides dental
services as such services are defined in article 133 of the education
law, each member of such foreign professional service limited liability
company must be licensed pursuant to article 133 of the education law to
practice dentistry in this state. With respect to a foreign professional
service limited liability company which provides professional engineer-
ing, land surveying, architectural and/or landscape architectural
S. 2932--A 6
services as such services are defined in article 145, article 147 and
article 148 of the education law, each member of such foreign profes-
sional service limited liability company must be licensed pursuant to
article 145, article 147 and/or article 148 of the education law to
practice one or more of such professions in this state. With respect to
a foreign professional service limited liability company which provides
licensed clinical social work services as such services are defined in
article 154 of the education law, each member of such foreign profes-
sional service limited liability company shall be licensed pursuant to
article 154 of the education law to practice clinical social work in
this state. With respect to a foreign professional service limited
liability company which provides creative arts therapy services as such
services are defined in article 163 of the education law, each member of
such foreign professional service limited liability company must be
licensed pursuant to article 163 of the education law to practice crea-
tive arts therapy in this state. With respect to a foreign professional
service limited liability company which provides marriage and family
therapy services as such services are defined in article 163 of the
education law, each member of such foreign professional service limited
liability company must be licensed pursuant to article 163 of the educa-
tion law to practice marriage and family therapy in this state. With
respect to a foreign professional service limited liability company
which provides mental health counseling services as such services are
defined in article 163 of the education law, each member of such foreign
professional service limited liability company must be licensed pursuant
to article 163 of the education law to practice mental health counseling
in this state. With respect to a foreign professional service limited
liability company which provides psychoanalysis services as such
services are defined in article 163 of the education law, each member of
such foreign professional service limited liability company must be
licensed pursuant to article 163 of the education law to practice
psychoanalysis in this state.
S 6. Subdivision (q) of section 121-1500 of the partnership law, as
separately amended by chapters 420 and 676 of the laws of 2002, is
amended to read as follows:
(q) Each partner of a registered limited liability partnership formed
to provide medical services in this state must be licensed pursuant to
article 131 of the education law to practice medicine in this state and
each partner of a registered limited liability partnership formed to
provide dental services in this state must be licensed pursuant to arti-
cle 133 of the education law to practice dentistry in this state;
PROVIDED, HOWEVER, THAT WITH RESPECT TO A REGISTERED LIMITED LIABILITY
PARTNERSHIP FORMED TO PROVIDE SERVICES DEFINED IN ARTICLE 131 OF THE
EDUCATION LAW WITH SERVICES DEFINED IN ARTICLE 143 AND/OR ARTICLE 144 OF
THE EDUCATION LAW, EACH MEMBER OF SUCH REGISTERED LIMITED LIABILITY
PARTNERSHIP MUST BE LICENSED PURSUANT TO ARTICLE 131 AND CERTIFIED BY
THE AMERICAN BOARD OF OPHTHALMOLOGY, AND/OR LICENSED PURSUANT TO ARTICLE
143 AND/OR ARTICLE 144 OF THE EDUCATION LAW TO PRACTICE ONE OR MORE OF
SUCH PROFESSIONS IN THIS STATE. Each partner of a registered limited
liability partnership formed to provide veterinary services in this
state must be licensed pursuant to article 135 of the education law to
practice veterinary medicine in this state. Each partner of a registered
limited liability partnership formed to provide professional engineer-
ing, land surveying, architectural and/or landscape architectural
services in this state must be licensed pursuant to article 145, article
147 and/or article 148 of the education law to practice one or more of
S. 2932--A 7
such professions in this state. Each partner of a registered limited
liability partnership formed to provide licensed clinical social work
services in this state must be licensed pursuant to article 154 of the
education law to practice clinical social work in this state. Each part-
ner of a registered limited liability partnership formed to provide
creative arts therapy services in this state must be licensed pursuant
to article 163 of the education law to practice creative arts therapy in
this state. Each partner of a registered limited liability partnership
formed to provide marriage and family therapy services in this state
must be licensed pursuant to article 163 of the education law to prac-
tice marriage and family therapy in this state. Each partner of a regis-
tered limited liability partnership formed to provide mental health
counseling services in this state must be licensed pursuant to article
163 of the education law to practice mental health counseling in this
state. Each partner of a registered limited liability partnership formed
to provide psychoanalysis services in this state must be licensed pursu-
ant to article 163 of the education law to practice psychoanalysis in
this state.
S 7. Subdivision (q) of section 121-1502 of the partnership law, as
amended by chapter 230 of the laws of 2004, is amended to read as
follows:
(q) Each partner of a foreign limited liability partnership which
provides medical services in this state must be licensed pursuant to
article 131 of the education law to practice medicine in the state and
each partner of a foreign limited liability partnership which provides
dental services in the state must be licensed pursuant to article 133 of
the education law to practice dentistry in this state; PROVIDED, HOWEV-
ER, THAT WITH RESPECT TO A FOREIGN LIMITED LIABILITY PARTNERSHIP FORMED
TO PROVIDE SERVICES DEFINED IN ARTICLE 131 OF THE EDUCATION LAW WITH
SERVICES DEFINED IN ARTICLE 143 AND/OR ARTICLE 144 OF THE EDUCATION LAW,
EACH MEMBER OF SUCH FOREIGN LIMITED LIABILITY PARTNERSHIP MUST BE
LICENSED PURSUANT TO ARTICLE 131 AND CERTIFIED BY THE AMERICAN BOARD OF
OPHTHALMOLOGY, AND/OR LICENSED PURSUANT TO ARTICLE 143 AND/OR ARTICLE
144 OF THE EDUCATION LAW TO PRACTICE ONE OR MORE OF SUCH PROFESSIONS IN
THIS STATE. Each partner of a foreign limited liability partnership
which provides veterinary service in the state shall be licensed pursu-
ant to article 135 of the education law to practice veterinary medicine
in this state. Each partner of a foreign limited liability partnership
which provides professional engineering, land surveying, architectural
and/or landscape architectural services in this state must be licensed
pursuant to article 145, article 147 and/or article 148 of the education
law to practice one or more of such professions. Each partner of a
foreign limited liability partnership which provides licensed clinical
social work services in this state must be licensed pursuant to article
154 of the education law to practice licensed clinical social work in
this state. Each partner of a foreign limited liability partnership
which provides creative arts therapy services in this state must be
licensed pursuant to article 163 of the education law to practice crea-
tive arts therapy in this state. Each partner of a foreign limited
liability partnership which provides marriage and family therapy
services in this state must be licensed pursuant to article 163 of the
education law to practice marriage and family therapy in this state.
Each partner of a foreign limited liability partnership which provides
mental health counseling services in this state must be licensed pursu-
ant to article 163 of the education law to practice mental health coun-
seling in this state. Each partner of a foreign limited liability part-
S. 2932--A 8
nership which provides psychoanalysis services in this state must be
licensed pursuant to article 163 of the education law to practice
psychoanalysis in this state.
S 8. This act shall take effect immediately.
