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The South Carolina LLC operating agreement is a recommended legal document for those who are opening a limited liability company, especially with multiple members. This document sets the guidelines for the business, expectations of each member, financial benefits, voting rights, and other ownership responsibilities required as an LLC.

From SC Code § 33-44-101 (2019):

(13) “Operating agreement” means the agreement under Section 33-44-103 concerning the relations among the members, managers, and limited liability company. The term includes amendments to the agreement.

South Carolina Operating Agreement Law

Per Title 33, Chapter 44, Section 103 of the South Carolina Code of Laws:

(a) Except as otherwise provided in subsection (b), all members of a limited liability company may enter into an operating agreement, which need not be in writing, to regulate the affairs of the company and the conduct of its business, and to govern relations among the members, managers, and company. To the extent the operating agreement does not otherwise provide, this chapter governs relations among the members, managers, and company.
(b) The operating agreement may not:
(1) unreasonably restrict a right to information or access to records under Section 33-44-408;
(2) eliminate the duty of loyalty under Section 33-44-409(b) or 33-44-603(b)(3), but the agreement may:
(i) identify specific types or categories of activities that do not violate the duty of loyalty, if not manifestly unreasonable; and
(ii) specify the number or percentage of members or disinterested managers that may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty;
(3) unreasonably reduce the duty of care under Section 33-44-409(c) or 33-44-603(b)(3);
(4) eliminate the obligation of good faith and fair dealing under Section 33-44-409(d), but the operating agreement may determine the standards by which the performance of the obligation is to be measured, if the standards are not manifestly unreasonable;
(5) vary the right to expel a member in an event specified in Section 33-44-601(6);
(6) vary the requirement to wind up the limited liability company’s business in a case specified in Section 33-44-801(3) or (4); or
(7) restrict rights of a person, other than a manager, member, and transferee of a member’s distributional interest, under this chapter.

Forming an LLC in South Carolina

  1. Conduct a name search
  2. Choose a registered agent
  3. File formation articles
  4. Draft an operating agreement

To qualify as an LLC, all South Carolina LLCs need a legally registered business name, which must be dissimilar from existing formations in the state and include one of:

  • LLC
  • LC
  • L.L.C.
  • L.C.
  • Ltd.
  • Co.
  • Limited Liability Corp
  • Limited Company

The name may not include government agency names or abbreviations (Treasure, DOD, FBI, etc), but may include professional titles like bank or lawyer as long as a licensed practitioner is an organizing member.

No other business titles, such as corporations may be included in the name.

To conduct the name search, use the South Carolina Secretary of State Business Entity Search website.

Step 2: Choose Your Registered Agent

Every South Carolina LLC is required to appoint a registered agent for the company. The registered agent is responsible for accepting service of process on behalf of the company. This can be a member or a professional service.

The agent must:

  • Be 18 years or older
  • Be available during business hours (9am – 5pm local time)
  • Be a resident of the state
  • Have a physical (not a P.O. Box) address in South Carolina

If using a registered agent service, the agent must be authorized to do business in South Carolina.

Step 3: File Your Formation Articles

In order to legally establish an LLC in South Carolina, you must file articles of formation.

Domestic LLCs (new in-state businesses) must complete Articles of Organization and submit 2 forms when filing via mail.

Online Filing (Domestic):

  • $110 filing fee
  • Turnaround time: Within 24 hours
  • Create an account and submit online

Mailed Filing (Domestic):

SC Secretary of State
Attn: Corporate Filings
1205 Pendleton St., STE 525
Columbia, SC 29201

Foreign LLCs (existing businesses expanding to South Carolina) must file for a Certificate of Authority to operate in the state. This application must be submitted alongside an original Certificate of Existence from the home state, and submit 2 copies when filing by mail.

Online Filing (Foreign):

  • $110 filing fee
  • Turnaround time: Within 24 hours
  • Create an account and submit online

Mailed Filing (Foreign):

SC Secretary of State
Attn: Corporate Filings
1205 Pendleton St., STE 525
Columbia, SC 29201

Step 4: Draft a South Carolina Operating Agreement

Although not required, it is highly recommended for LLCs to create an operating agreement for LLCs with a single or multiple directors. This legal documentation is recommended to document capital contributions, voting rights, ownership percentage, responsibilities, profit and loss distribution, and more.

A South Carolina operating agreement can settle disputes between multiple directors or act as proof in court when signed and acknowledged by all parties involved.

It is recommended that all directors keep a copy, but the agreement does not need to be filed with the state.