South Dakota Constitution Article 17 - Corporations.
South Dakota Constitution – Article XVII: Corporations
Summary:
Article XVII of the South Dakota Constitution governs the creation, regulation, and operation of corporations within the state. This includes both private business corporations and municipal/public corporations.
🔑 Key Provisions of Article XVII:
Section 1 – Corporate Formation
Corporations must be formed under general laws, not by special legislative acts.
The Legislature cannot pass special laws to create corporations—ensuring fairness and uniformity.
Section 2 – Corporate Regulation
The state retains the power to alter, amend, or revoke corporate charters or laws.
This allows South Dakota to regulate corporate behavior in the public interest.
Section 3 – Foreign Corporations
Foreign (out-of-state) corporations may do business in South Dakota only under conditions prescribed by the Legislature.
They are subject to the same regulations as domestic corporations.
Section 4 – Municipal Corporations
Municipal corporations (like city governments) are limited in their ability to incur debt.
They must follow constitutional and statutory restrictions to prevent irresponsible borrowing.
Section 5 – Liability for Damages
Corporations and their stockholders may be liable for damages caused by the corporation or its agents.
Protects citizens from corporate negligence or wrongdoing.
🧭 Purpose and Intent:
This article is intended to:
Prevent abuse of corporate privileges.
Ensure corporations serve public as well as private interests.
Protect consumers and communities from unfair corporate practices.
Maintain legislative control over corporate power.
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