COLUMBUS - 

State Senator Larry Obhof (R-Medina) announced that Senate Bill 181 will become effective this week, on Wednesday, July 6. Senator Obhof sponsored the bill, which makes significant changes to Ohio's corporate law. 

The bill received broad bi-partisan support in both the Ohio Senate and the House of Representatives, and was signed into law by Governor Kasich in early April. During the legislative process, Senate Bill 181 was supported by the Ohio State Bar Association and the Ohio Chamber of Commerce.  

“Senate Bill 181 is the next step in our ongoing effort to improve Ohio’s corporate law and strengthen the state’s business climate,” said Obhof. “The new law puts an emphasis on freedom of contract and makes Ohio an even more attractive place to do business.”  

Among other things, Senate Bill 181 closes a gap in current law by defining the responsibilities and fiduciary duties of corporate officers. The responsibilities of corporate directors are already defined in existing law, but no criteria are currently established for officers (who run the business on a day-to-day basis). Senate Bill 181 establishes identical responsibilities for officers to those already outlined for directors. The bill also requires corporate and limited liability company officers to act in good faith and act with care in the performance of their duties. 

Senate Bill 181 also codifies that it is the policy of Ohio’s Limited Liability Company Law to give maximum effect to the principle of freedom of contract. This gives people who form LLCs in Ohio greater flexibility to customize their relationships by defining the duties that they owe to each other – a change that will make Ohio a more attractive place to do business.  

Senator Obhof has sponsored several civil and corporate law changes in recent years. Last year, he sponsored a bill to cut the filing fee for starting a new business by nearly 21 percent. So far in 2016, Ohio is on pace for the most new business formations in the state’s history.   

“We have been working for several years to make Ohio a place for economic growth,” said Obhof. “Senate Bill 181 will build on that progress and continue moving Ohio in the right direction.”

 
 
 
  
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