Purpose

To establish a 45-day payment term for certain corporations in Minnesota’s commerce rules, specifically requiring timely remittance of payment for goods and services.

Main provisions

• Creates a new section (Remittance of Payment) in Minnesota Statutes chapter 325E.
• If a corporation’s stock is a federal covered security as defined by United States Code Title 15 Section 77rb, that corporation must remit payment for goods and services within 45 days of receiving those goods or services.
• For purposes of this section, the term “corporation” includes a subsidiary that is wholly owned by a corporation subject to the payment term requirement.

Significant changes to existing law

• Adds a new statutory requirement specifying a 45-day payment deadline for certain corporations in Minnesota’s commerce framework.
• Expands the scope of who is covered by the payment term to include wholly owned subsidiaries of those corporations.

Potential impacts and considerations

• Vendors and suppliers may receive payments more quickly, improving cash flow.
• Affected corporations may need to adjust internal payment processes to ensure compliance with the 45-day deadline.
• The change targets a subset of corporations defined by ownership of stock that qualifies as a federal covered security.

Practical implications

• The 45-day term begins after goods or services are received, not after an invoice is issued.
• Businesses should verify whether they fall under the “federal covered security” criterion to determine if the rule applies.

Relevant Terms - 45 days - remittance of payment - within 45 days of receiving the goods or services - goods and services - corporation - federal covered security - United States Code Title 15 Section 77rb - Minnesota Statutes Chapter 325E - subsidiary wholly owned by a corporation - payment term - commerce