Section 27.2. Applicability of statutory close corporation provisions

(a) Section 1103 of the BCL (relating to definitions) provides for two types of close corporations:

(1) Statutory close corporations, which are business corporations which have done one of the following:

(i) Incorporated on Form DSCB:15-1306/2102/2303/2702/2903/3101/7702A (Articles of Incorporation-For Profit) with a statutory close corporation election indicated, or on the corresponding form under prior law.

(ii) Elected to become statutory close corporations by filing Form DSCB:15-2305 (Articles of Amendment-Election of Statutory Close Corporation Status-Domestic Business Corporation), or the corresponding form under prior law. See section 2301(a) of the BCL (relating to application and effect of chapter).

(2) Closely-held corporations, which are one of the following:

(i) Statutory close corporations.

(ii) Business corporations which have not more than 30 shareholders, with shares that are held jointly or in common or in trust by two or more persons, as fiduciaries or otherwise, or that are held by spouses, being deemed held by one shareholder for this purpose.

(b) Closely-held corporation status is automatic, and no filing in the Department shall be made with respect to the acquisition or termination of that status.

(c) Section 2301(a) of the BCL provides that a business corporation may not be simultaneously a statutory close corporation and a management corporation. A statutory close corporation may be one or more of the following: a nonstock corporation, a registered corporation, a professional corporation and an insurance corporation.

The provisions of this § 27.2 adopted April 17, 1992, effective April 18, 1992, 22 Pa.B. 1993.