Bill > SB782

This bill establishes the Limited Liability Decentralized Autonomous Organization (LLD) Act, creating a new legal entity that operates using blockchain technology and smart contracts for decentralized decision-making, with participants having limited liability for the organization's debts and obligations. To form an LLD, articles of formation must be filed with the State Corporation Commission (the Commission), which may then issue a certificate of formation if requirements are met; the bill also outlines procedures for amending these articles, as well as requirements for LLD bylaws, operating agreements, smart contracts, and participant interests. Key terms include "blockchain" (a decentralized digital ledger), "smart contract" (automated code that executes agreements), "governance token" (representing a participant's interest and voting rights), and "LLD" itself, defined as a distinct legal entity operating through decentralized governance. The bill also mandates the appointment of a legal representative in the Commonwealth for off-blockchain matters and specifies that LLDs will be treated as Limited Liability Companies for tax purposes, with income allocated to participants based on their ownership of governance tokens. The Commission is directed to adopt emergency regulations to implement these provisions, with most of the bill's requirements taking effect on January 1, 2027.

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https://lis.virginia.gov/bill-details/20261/SB782