Q1. What is a Public Benefit Corporation?
A1.A public benefit corporation (PBC) is a for profit corporation or domestic cooperative that is intended to produce one or more public benefits and to operate in a responsible and sustainable manner.
Q2. What is a public benefit?
A2.Section 7-101-503(2), C.R.S., defines public benefit as "one or more positive effects or reduction of negative effects on one or more categories of persons, entities, communities, or interests other than shareholders in their capacities as shareholders, including effects of an artistic, charitable, cultural, economic, educational, environmental, literary, medical, religious, scientific, or technological nature."
Q3. What requirements must an entity satisfy in order to be a Public Benefit Corporation (PBC)?
A3.An entity must satisfy several requirements to be a PBC, including the following:
- The articles of incorporation must identify one or more specific public benefits that the entity will promote,
- The articles of incorporation must state at the beginning that the entity is a PBC,
- The entity’s name can include the words "public benefit corporation" or the abbreviations "Pub. Ben. Corp.", "P.B.C." or "PBC", and
- Share certificates issued for a PBC must clearly indicate that the entity is a PBC.
For other requirements, see § 7-101-503, C.R.S.
Q4. Does a Public Benefit Corporation (PBC) need to register under the Colorado Charitable Solicitations Act?
A4.In some cases, the specific benefits a PBC identifies in its articles of incorporation may also fit the definition of a "charitable purpose" under the Colorado Charitable Solicitations Act. If the PBC intends to solicit funds in Colorado for that purpose, it may need to also register as a charitable organization. See thecharities FAQs.
