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forshaper 3 hours ago

I don't get it. Most companies registered in the state I live in, for example, are not actually located here. They simply receive mail through their registered agent there. Why would this be news?

raddan 3 hours ago | parent | next [-]

On the other hand, most of the companies registered in Delaware are not trying to dodge US federal regulations. Polymarket is prohibited from operating in the US market. Nevertheless they have a substantial customer base in the US, and the part left unsaid in the NPR story, is that they’re probably also headquartered in the US. Almost definitely a violation of either gambling or securities regulations.

trollbridge 2 hours ago | parent | next [-]

They are often trying to dodge their local state’s regulations, though.

adrr an hour ago | parent | next [-]

No. Its because has chancery court which is a court based on equity not a court based on common law.

skissane an hour ago | parent [-]

> No. Its because has chancery court which is a court based on equity not a court based on common law.

This is somewhat confused. Most common law jurisdictions merged their courts of law and courts of equity into a single unified court system long-ago; Delaware is unusual in not having done so

But if you bring an equitable cause of action, courts in other jurisdictions will apply equity to decide it. And Delaware’s Court of Chancery applies common law as well.

There are real advantages to Delaware’s judicial system from a corporate perspective-a specialised court system can be more responsive because it isn’t weighed down with other types of cases, doesn’t have juries, offers judges with deep experience in that specific area of law, etc. But it isn’t purely due to keeping separate equity courts; other jurisdictions could get similar results by establishing specialised courts for particular types of cases, without necessarily having to rely on the old law-vs-equity jurisdiction to draw the line.

_--__--__ 2 hours ago | parent | prev | next [-]

Incorporating in Delaware was initially attractive because of usury laws that matter to a small number of business sectors.

The charitable take is that most corporations want to comply with a state's regulations because unintentional compliance violations are painful and expensive, and it is relatively easy to be confident that you are compliant as a Delaware corp.

eichin an hour ago | parent [-]

When I last did it, there were two wins for a tech startup incorporating in delaware:

* it's easy and well-documented - the main thing you have to remember is to check the boxes that say this is an actual company, and not a holding company for a boat (where the real tax dodging is)

* it was reported to make acquisitions easier (as the company acquiring you would either also be a Delaware corp or it would be more straightforward even if they weren't.)

kube-system an hour ago | parent [-]

Yes it is highly preferable for mergers/acquisitions/financing because the law is well established and widely known in those industries.

If you run into some legal question somewhere down the line, investors and their lawyers will be much more comfortable with Delaware law than some other state who may not have clear language on the books and/or have never tested that particular situation in court before.

detourdog 5 minutes ago | parent [-]

That is really a wild thing. I culture of legal belief based on precedent. It's as if one is joining a club that has rules of business conduct clearly documented.

dhosek 2 hours ago | parent | prev [-]

When I had a C-corp in the 90s for a magazine I was publishing, my dad’s cousin insisted that I should incorporate in Delaware or Nevada. The thing is that because I was operating in California, especially at the small scale that I operated, it did nothing for me at all really. I would still pay California taxes and be subject to California regulations. Mostly it would make a difference if I were sued.

(Obligatory disclaimer that these are ~30-year-old memories of some dumb 20-something’s understanding of the law at the time.)

nickff 41 minutes ago | parent [-]

It might also make a significant difference if you sold the company, which is one reason why many companies move to Delaware when they are looking for an acquirer.

mywacaday 2 hours ago | parent | prev | next [-]

I used to work for a large financial services company who bought 4 storey office block and fitted it out with very small but with own door individual offices that had internet and a connected desk phone so that companies could rent them and say they had more than a box office address in that European capital, I never found out what the rent was.

pear01 2 hours ago | parent | prev [-]

Polymarket is already working on a full return to the US market aided by sympathetic policy changes of the current administration.

Additionally, the claim "most of the companies registered in Delaware are not trying to dodge US federal regulations" strikes me as dubious. Every company seeks to lower its regulatory burden. If they're not finding loopholes, then often they're the ones writing the regulations and funding congressional campaigns. I'm not sure the claim Polymarket is unique re its relationship to the government in this respect is credible. They seem to be working quite intimately with the current administration on returning from their Biden era "ban".

raddan an hour ago | parent | next [-]

There’s dodging and then there’s _dodging_. If you are operating in a legal gray area, that’s an unsavory business practice that is, as you say, widespread. Then there’s operating illegally in full view of everybody. I do not personally ascribe to the idea that a thing is OK just because one is not currently being prosecuted. Polymarket (and Kalshi) is bad for the country, their claims to the contrary are highly dubious, and it’s a case where not only are they actually in the wrong, they are quite specifically legally wrong.

pear01 an hour ago | parent | next [-]

You may feel that way, and I may sympathize. But I really think you are over-indexing on your own personal belief that they are "bad for the country". If we follow your logic then a company is doing more _dodging_ simply on the basis of one's own moral aversion. So maybe if I'm an environmentalist I think coal companies are especially dodgy. If I'm a pacifist maybe a defense contractor. If I'm an evangelical maybe a company that contracts with the government re some reproductive care.

"operating illegally in full view" vs "legal gray area" is not a determination that can be made based on your subjective view of what "makes a thing OK". The fact that you pair the accusation that they are "operating illegally in full view" with the notion that you can condemn a thing that is not "currently being prosecuted" only further undermines your argument. Your moral objection is your judgement to make, the question of what is illegal cannot be. The latter is exclusively the domain of the courts, not any individual (or collective) moral outrage. Your seeming desire to conflate the two to satisfy your personal feelings unfortunately undermines whatever cogent points you may have re their legality on the merits.

The fact is they are currently working with the government on a return to the US markets. engaging in a government process such as they are seems to not resemble anything akin to "operating illegally in full view of everybody". You would be more convincing if you would levy your criticism in more reasonable terms. I personally suspect there is a lot more "gray area" here than you seem to contemplate.

Spooky23 an hour ago | parent | prev [-]

Well, the good news for them is that the president’s children are involved in the company. It’ll be very easy to grease the appropriate hands.

fsckboy an hour ago | parent | prev [-]

>the claim "most of the companies registered in Delaware are not trying to dodge US federal regulations" strikes me as dubious

huh? you aren't making a coherent argument. registering in any US state you are still subject to the same federal regulations, Delaware is not different, it offers no shelter from federal regulations.

in fact, if it is not your primary state of operation, then it subjects you to federal regulations for interstate commerce where you might not otherwise be.

Extropy_ 3 hours ago | parent | prev | next [-]

They acknowledge this in the article as well, surprisingly enough.

> Corporate law experts say while there is nothing illegal about housing a business inside a shell company, the practice is often a strategic move to protect a firm's wealth or shield it against lawsuits and action from government regulators.

What is the thought process of someone writing this? Does this article have any meaningful or critical thought behind it?

janalsncm 3 hours ago | parent | next [-]

It isn’t newsworthy for people who believe the laws around corporate transparency and accountability are good enough.

Many people do not, which is why it is noteworthy, even if it is standard.

horacemorace 3 hours ago | parent | prev | next [-]

They’re avoiding editorializing. PBS news has the same dry “facts only” flavor. Legitimate reporting takes the high road; corpo-media too often take the low road. Unfortunately human information consumers tend to gravitate toward sources of maximum opinion.

randallsquared an hour ago | parent [-]

Do you think "housing a business inside a shell company" is not editorializing when referring (apparently) to running a company that has a registered agent in a normal, permissive jurisdiction like Panama, Ireland, or Delaware?

no-name-here an hour ago | parent [-]

What are the ‘personal opinions or subjective interpretations’ you feel it’s using? What should the content be to not be ‘editorializing’ in your opinion?

Exoristos 2 hours ago | parent | prev | next [-]

They're doing their part in keeping a spotlight on Polymarket. The content of the article is not irrelevant, but it is less important than the existence of the article.

forshaper 3 hours ago | parent | prev [-]

I guess we're scratching our heads, and even we clicked.

deckar01 35 minutes ago | parent | prev | next [-]

> there was no sign of Polymarket, nor the entity it does business as

The law firm at that address was not their registered agent. Their ToS mandated arbitration with an entity that doesn’t exist.

creatonez 3 hours ago | parent | prev | next [-]

It is indeed already normal for rich people to do things that are sketchy as hell.

Maybe let's make it not normal?

JuniperMesos 3 hours ago | parent | next [-]

I really don't trust your definition of sketchy as hell and don't want it to have legal or normative force.

creatonez 2 hours ago | parent | next [-]

For-profit companies jurisdiction shopping without any physical presence is so clearly sketchy that it's wild anyone could see it otherwise. I can't imagine a normal person not being shocked in disbelief when they first learn about the concept of tax havens.

kube-system an hour ago | parent [-]

Maybe when it’s Panama. But there is not a single sketchy reason why companies choose to incorporate in Delaware, for instance.

There are very legitimate reasons to incorporate in another location. Some are not only not sketchy, but even altruistic, e.g. incorporating in another state for the purpose of incorporating as a PBC.

otterley 2 hours ago | parent | prev | next [-]

You haven't heard their definition yet.

nullsanity 10 minutes ago | parent | prev [-]

[dead]

k33n an hour ago | parent | prev | next [-]

Do poor people ever do anything sketchy as hell?

croes an hour ago | parent [-]

Do the sketchy things of poor people affect as much other people as the sketchy of rich?

Who more often jail time for sketchy things? Poor or rich?

lazide 28 minutes ago | parent [-]

Are we talking drug gangs as poor? Because the foot soldiers sure are.

PearlRiver 10 minutes ago | parent [-]

I would blame those on the middle class cocaine users who fund the drug gangs.

tt24 2 hours ago | parent | prev [-]

Registered agents are sketchy now?

creatonez 2 hours ago | parent [-]

If the only shell(s) for a business are in a completely different jurisdiction with no connection whatsoever to any of the humans involved in operating the organization... yes. It's an outrageous way to escape the force of the law that has been rubber stamped by corrupt politicians.

kube-system an hour ago | parent [-]

It is exceeding common for US companies to incorporate without a presence in Delaware for the exact opposite reason of dodging the law. It is done to make legal compliance easier and more streamlined.

no-name-here 44 minutes ago | parent [-]

Is Polymarket registered in Panama to make legal compliance easier/for the opposite reason of dodging the law?

lazide 29 minutes ago | parent [-]

Registering in Panama isn’t even the sketchy thing! They listed a false agent of process, hah.

alpb 2 hours ago | parent | prev | next [-]

this is a good explainer video that talks about why Polymarket maintains a Panama HQ instead of a US one and why it has two different sites (.us vs .com). https://www.youtube.com/watch?v=seNwZhK4UdA

King-Aaron 43 minutes ago | parent | prev | next [-]

The point being, yes, we all know this, but also it's done purely to bypass taxation which shouldn't ever be accepted.

Carioca 3 hours ago | parent | prev | next [-]

> Why would this be news?

Mostly because international litigation is, let's say, fraught issues (as in "good luck!")

forshaper 3 hours ago | parent [-]

Yes. Is that news?

JuniperMesos 3 hours ago | parent | prev | next [-]

Because NPR dislikes polymarket and thinks that reporting this will discredit them.

shermantanktop 2 hours ago | parent | next [-]

If the facts themselves discredit Polymarket, NPR doesn't have to like or dislike them. Polymarket made itself newsworthy, it can't complain if someone looks at them closely.

NuclearPM 2 hours ago | parent | prev | next [-]

It does.

micromacrofoot an hour ago | parent | prev [-]

is it not true? from my perspective they're just stating a fact that some people may not be aware of (registering a business in a location it doesn't physically exist in)

aaron695 3 hours ago | parent | prev [-]

[dead]