Over Labor Day weekend, after over a decade of development efforts, the Delaware Division of Corporations (the “Division”) successfully launched a new web-based system to administer its business entity and UCC filing systems. Fortunately, Delaware state administrators and the agent community had a long period to train, test and update the system to make sure it was ready for prime-time. The public does not see this new company filing website because it is behind a password protected internet firewall, but the public is the key beneficiary of this new system’s speed and expanded capability.
You may be aware of the Division’s public website available at corp.delaware.gov, which offers limited information about corporate filings, a franchise tax payment portal and general information about Delaware entities. However, the real muscle behind this public-facing website is the little known back-end known as DCIS, which powers the state’s filing system. This system is used by the Division and a few dozen of Delaware’s Commercial Registered Agents to submit filings, obtain certificates and submit UCC filings.
Delaware takes pride in being the leading state for business entity law. One of the advantages of Delaware is its responsive filing system, including Delaware’s team of state employees and network of commercial agents. Through DCIS, commercial agents located in Delaware who enter access contracts, complete training and pay access fees are able to incorporate or form new companies in 2 business days (or even one hour for expedited fees) and obtain certificates of good standing or certified copies of corporate filings within minutes. Other states previously updated their filing systems, and many used the same vendor to update their system. Delaware, however, was determined to develop its own proprietary system that would be extremely versatile to meet all of its users’ needs with more room for growth and customization. Delaware’s efforts to develop this system took longer than expected because many software developers are unfamiliar with the ins and outs of Delaware’s corporate filing system, which administers over one million corporate entities and countless UCC filings. Since so many large and small businesses across the country and around the world rely on this system, the Division wanted to make sure the new system was thoroughly vetted for bugs before launching.
This new, custom-built, web based DCIS system replaced the original MS-DOS based system that launched around 1989. With the former MS-DOS DCIS, emulators were needed to simulate an older, pre-Windows operating system on 32-bit computers. Also, the former DCIS system had limitations and required patchwork fixes to keep current with rapidly advancing technology and the law. While the Division was diligent in making these updates, the inevitable shift to a newer platform was required to keep pace with modern technology demands, including XML access to databases and increased security. The original DCIS was built to be accessed by dial-up modems. Before Labor Day 2015, the old DCIS operated by the use of a laundry list of archaic commands and complex steps to complete even routine filings. The new DCIS system is web-based, accessible through virtual private network (VPN) tunnel or SSL connection. It is more user-friendly and intuitive than its predecessor DCIS.
When DCIS launched over Labor Day weekend, the Division spent many late nights applying small patches. But, for the most part, the system worked as expected and is off to a strong start. For most lawyers and business owners, the transition will be seamless because only certain Delaware Commercial Registered Agents will be accessing the system directly. Some limitations during launch included being closed for one business day and restricting access to the DCIS system to the hours between 8:00 a.m. and 5:00 p.m. Under routine circumstances, the office is open much later. Since this qualifies as an “extraordinary event” under Delaware law, this interruption allows people filing documents to request an earlier filing date if the user was prepared but unable to file when the Division was closed to run updates after 5:00 p.m.
- The new DCIS makes company data (good standing status, franchise tax history, etc) easier to search. Being web-based means the new DCIS will integrate better with other computer systems, for example, customer resource management systems.
- Big improvement in the area of data exporting / reports. The old DCIS had virtually no reporting functionality.
- The funding for the DCIS upgrade came from Division’s internal Technology Infrastructure Fund, not from taxpayers. Fees from expedited filing orders were put into this fund. In total the upgrade cost approximately $22 million.
- Training new users has been easy and requires less time than the antiquated older DCIS. The new DCIS system is more intuitive and looks like other web based systems. MS-DOS navigation is foreign to many people.
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