USA – TEXAS Trends and Developments Contributed by: Kenneth “KJ” Johnston and Blaine Grant, Phelps Dunbar LLP
Doing Business in Texas in 2026: Courts, Capital, and Capacity Texas has established itself as a leading business- friendly jurisdiction in the United States. Accord - ing to the Texas Economic Development & Tourism Office, Texas continues to attract businesses due to its business-friendly climate, absence of corporate or personal income tax, skilled and diverse workforce, accessible global markets, strong infrastructure, and reasonable regulatory environment. However, in 2026, Texas is moving beyond size, growth, and political branding by building a comprehensive business-law ecosystem. This includes specialised courts for high- value commercial disputes, updates to corporate- governance law, new capital markets infrastructure, advanced power and infrastructure planning, and support for emerging industries such as commer - cial space, artificial intelligence infrastructure, energy expansion, and advanced manufacturing. For compa - nies considering Texas, the opportunities are signifi - cant, but so are the diligence requirements. Growth alone no longer defines Texas; legal, governance, energy, and dispute resolution planning must now be addressed early in any Texas investment. A new forum for high-risk business disputes One of the most important legal developments for companies doing business in Texas is the creation and continuing refinement of the Texas Business Court and the Fifteenth Court of Appeals. Together, they represent a structural change in how Texas will handle many high-stakes commercial disputes. The Business Court is a specialised trial court for certain commercial disputes. It does not replace Texas dis - trict courts, nor does it hear every business case. Its importance lies in the types of disputes it is designed to handle: high-value commercial matters, govern - ance disputes, fiduciary-duty claims, significant busi - ness transactions, and other matters that can benefit from judges focused on complex business litigation. For parties entering Texas transactions, this devel - opment changes initial planning. Forum selection clauses, venue provisions, governing-law clauses, jury-waiver provisions, arbitration clauses, and enti - ty-governance documents should be reviewed with the Business Court in mind. Companies should not assume disputes will automatically be heard in the Business Court, nor should they overlook its likely
influence. In appropriate cases, access to a special - ised business forum may influence litigation strate - gy and settlement leverage. The Fifteenth Court of Appeals is equally important. Appeals from the Busi - ness Court follow a specialised appellate path. Over time, that should help create a more coherent body of Texas commercial-law precedent. That is significant in a state where large commercial disputes histori - cally moved through different intermediate appellate districts, creating the possibility of uneven treatment among regions. As with any new court, some initial uncertainty is expected. Parties are testing the limits of jurisdiction, removal, remand, venue, and amount- in-controversy requirements. This uncertainty should prompt careful drafting, pleading, and planning, rather than avoidance of the forum. For businesses, dispute- resolution strategy in Texas now starts before litiga - tion. It should be considered during contract draft - ing, entity formation, governance updates, and when determining where and how prospective disputes will be resolved. Corporate-governance modernisation and the Texas redomestication pitch The Business Court is just one aspect of Texas’s expanded strategy. The state has also enacted sub - stantial changes to its business-organisation laws, striving to make Texas more attractive for operating, forming, governing, and potentially redomesticating business entities. Recent amendments to the Texas Business Organizations Code address issues that matter to directors, officers, shareholders, investors, and litigation counsel. They include provisions con - cerning internal entity claims, exclusive Texas forum provisions, jury-waiver provisions in governing docu - ments, derivative proceedings, director independ - ence, officer and director liability, and the treatment of certain shareholder-litigation practices. These changes reveal a national competition for corporate charters, headquarters, and investment. While Dela - ware remains the leading corporate law jurisdiction, Texas is making a direct appeal to corporations and investors. For companies with significant operations, capital, or litigation in Texas, and growing access to Texas-based exchange infrastructure, Texas corpo - rate law should be part of strategic planning. The most immediate impact is on corporate planning. Boards and management teams of Texas entities should
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