N.Y. Limited Liability Company Law § 1207: Membership of professional service limited liability companies

§ 1207. Membership of professional service limited liability

companies. (a) A member of a professional service limited liability

company shall be only:

(1) A professional, other than a foreign professional service

corporation, foreign professional service limited liability company or

foreign limited liability partnership, authorized by law to practice in

this state a profession that such limited liability company is

authorized to practice and who is or has been engaged in the practice of

such profession in such limited liability company or a predecessor

entity, or who will engage in the practice of such profession in such

limited liability company within thirty days of the date such

professional becomes a member;

(2) A professional, other than a foreign professional service

corporation, foreign professional service limited liability company or

foreign limited liability partnership, authorized by law to practice in

any foreign jurisdiction a profession that such limited liability

company is authorized to practice and who is or has been engaged in the

practice of such profession in such limited liability company or a

predecessor entity, or who will engage in the practice of such

profession in such limited liability company within thirty days of the

date such professional becomes a member; or

(3) A foreign professional service corporation, foreign professional

service limited liability company or foreign limited liability

partnership authorized by law to practice in this state or in any

foreign jurisdiction a profession that such limited liability company is

authorized to practice and who is or has been engaged in the practice of

such profession in such limited liability company or a predecessor

entity, or who will engage in the practice of such profession in such

limited liability company within thirty days of the date such

professional becomes a member.

(b) With respect to a professional service limited liability company

formed to provide medical services as such services are defined in

article 131 of the education law, each member of such limited liability

company must be licensed pursuant to article 131 of the education law to

practice medicine in this state. With respect to a professional service

limited liability company formed to provide dental services as such

services are defined in article 133 of the education law, each member of

such limited liability company must be licensed pursuant to article 133

of the education law to practice dentistry in this state. With respect

to a professional service limited liability company formed to provide

veterinary services as such services are defined in article 135 of the

education law, each member of such limited liability company must be

licensed pursuant to article 135 of the education law to practice

veterinary medicine in this state. With respect to a professional

service limited liability company formed to provide professional

engineering, land surveying, architectural, landscape architectural

and/or geological services as such services are defined in article 145,

article 147 and article 148 of the education law, each member of such

limited liability company must be licensed pursuant to article 145,

article 147 and/or article 148 of the education law to practice one or

more of such professions in this state. With respect to a professional

service limited liability company formed to provide public accountancy

services as such services are defined in article 149 of the education

law each member of such limited liability company whose principal place

of business is in this state and who provides public accountancy

services, must be licensed pursuant to article 149 of the education law

to practice public accountancy in this state. With respect to a

professional service limited liability company formed to provide

licensed clinical social work services as such services are defined in

article 154 of the education law, each member of such limited liability

company shall be licensed pursuant to article 154 of the education law

to practice licensed clinical social work in this state. With respect to

a professional service limited liability company formed to provide

creative arts therapy services as such services are defined in article

163 of the education law, each member of such limited liability company

must be licensed pursuant to article 163 of the education law to

practice creative arts therapy in this state. With respect to a

professional service limited liability company formed to provide

marriage and family therapy services as such services are defined in

article 163 of the education law, each member of such limited liability

company must be licensed pursuant to article 163 of the education law to

practice marriage and family therapy in this state. With respect to a

professional service limited liability company formed to provide mental

health counseling services as such services are defined in article 163

of the education law, each member of such limited liability company must

be licensed pursuant to article 163 of the education law to practice

mental health counseling in this state. With respect to a professional

service limited liability company formed to provide psychoanalysis

services as such services are defined in article 163 of the education

law, each member of such limited liability company must be licensed

pursuant to article 163 of the education law to practice psychoanalysis

in this state. With respect to a professional service limited liability

company formed to provide applied behavior analysis services as such

services are defined in article 167 of the education law, each member of

such limited liability company must be licensed or certified pursuant to

article 167 of the education law to practice applied behavior analysis

in this state. A professional service limited liability company formed

to lawfully engage in the practice of public accountancy as a firm, as

such practice is defined under article 149 of the education law shall be

required to show (1) that a simple majority of the ownership of the

firm, in terms of financial interests and voting rights held by the

firm's owners, belongs to individuals licensed to practice public

accountancy in some state, and (2) that all members of a limited

professional service limited liability company, whose principal place of

business is in this state, and who are engaged in the practice of public

accountancy in this state, hold a valid license issued under section

seventy-four hundred four of the education law. For purposes of this

subdivision, "financial interest" means capital stock, capital accounts,

capital contributions, capital interest, or interest in undistributed

earnings of a business entity. Although firms registered with the

education department may include non-licensee owners, a registered firm

and its owners must comply with rules promulgated by the state board of

regents. Notwithstanding the foregoing, a firm registered with the

education department may not have non-licensee owners if the firm's name

includes the words "certified public accountant," or "certified public

accountants," or the abbreviations "CPA" or "CPAs". Each non-licensee

owner of a firm that is registered under this section shall be (1) a

natural person who actively participates in the business of the firm or

its affiliated entities, or (2) an entity, including, but not limited

to, a partnership or professional corporation, provided each beneficial

owner of an equity interest in such entity is a natural person who

actively participates in the business conducted by the firm or its

affiliated entities. For purposes of this subdivision, "actively

participate" means to provide services to clients or to otherwise

individually take part in the day-to-day business or management of the

firm or an affiliated entity.

(c) No member of a professional service limited liability company

shall enter into a voting trust agreement, proxy or any other type of

agreement vesting in another person, other than another member of such

limited liability company or professional who would be eligible to

become a member of such limited liability company, the authority to

exercise voting power of any or all of the membership interests of such

limited liability company. All membership interests or proxies granted

or agreements made in violation of this section shall be void.