For nearly a century, “incorporate in Delaware” has been the reflexive advice given to American businesses, from Main Street startups to Fortune 500 giants. Delaware earned that position by having a specialized business court in the Court of Chancery, a deep bench of judges who do nothing but corporate law and a legislature that historically has moved quickly to keep its statutes current and business friendly.

Texas has spent the past three years assembling its own version of all three advantages, and the pace has accelerated considerably in recent months. Texas has created a specialized business court, passed a wave of corporate-governance legislation aimed squarely at companies deciding where to incorporate and, as of this month, began live trading on its own national stock exchange. These developments deserve to be examined together, because none of them happened by accident.

A Court Built to Generate Precedent

The Texas Legislature created the Texas Business Court in 2023 through House Bill 19, and the court began accepting cases on September 1, 2024.[1] Its judges are appointed rather than elected, and each must have at least ten years of experience in complex business litigation, business transactional work or prior service as a civil judge in Texas. Two design choices reveal the Legislature’s ambition. First, the Business Court issues written opinions, a departure from ordinary Texas trial-court practice and the mechanism by which Texas intends to build the kind of searchable, predictable body of corporate case law that took Delaware decades to accumulate. Second, appeals are channeled to a purpose-built appellate court, the Fifteenth Court of Appeals, which holds exclusive jurisdiction over appeals from the Business Court.[2] The structure deliberately echoes the relationship between Delaware’s Court of Chancery and the Delaware Supreme Court.

The Legislature has continued to invest in the project. House Bill 40, effective September 1, 2025, cut the amount-in-controversy threshold for a broad category of commercial disputes from $10 million to $5 million and extended the court’s jurisdiction to intellectual property, trade-secret and arbitration-related disputes.[3] A meaningful share of ordinary commercial disputes involving Texas parties now falls within its reach.

 

Statutes Written for the Boardroom

The second front is statutory. Senate Bill 29, enacted in May 2025, rewrote significant portions of Texas corporate law with an unmistakable audience in mind: boards and general counsel comparing Texas against Delaware. Among other changes, the legislation codified the business judgment rule, raised procedural hurdles for shareholder derivative litigation and expressly authorized corporations to adopt jury-trial waivers and forum-selection provisions in their governing documents, including provisions channeling internal disputes into the Business Court.[4] The statute has already been tested. Earlier this year, a federal court in the Northern District of Texas relied on S.B. 29 in dismissing a shareholder derivative suit and rejected the plaintiff’s argument that the statute was unconstitutional.[5]

Texas voters did their part as well. In November 2025, they approved a constitutional amendment prohibiting the Legislature from imposing an occupation tax on securities market operators or any tax on securities transactions.[6] On its face, a technical tax provision. In context, a promise of long-term fiscal certainty to exactly the kind of institution Texas was about to bring online.

 

The Texas Stock Exchange

That institution is the Texas Stock Exchange (“TXSE”). The SEC approved TXSE’s Form 1 registration as a national securities exchange on September 30, 2025, making it the first fully integrated national exchange approved in decades, and the exchange began live trading in Dallas on July 6, 2026, in a phased rollout expected to bring thousands of listed securities online by the end of the month.[7] Its backers include BlackRock, Citadel Securities, Charles Schwab and JPMorgan Chase, with roughly $275 million in committed capital behind the launch.[8]

The milestone that matters most is still ahead. Corporate listings are expected to begin in the fourth quarter of 2026, and TXSE plans a single-tier structure with listing standards pitched at mid- and large-cap issuers. An exchange that merely trades securities listed elsewhere is a curiosity. One that begins winning corporate listings opens a second front in the competition with the NYSE and Nasdaq, and gives companies weighing an IPO or a dual listing a genuinely new variable to consider.

 

The Broader Contest

None of this is happening in a vacuum. A steady procession of prominent public companies has reincorporated out of Delaware in recent years, a trend that has been coined “DExit,” citing everything from frustration with particular Chancery rulings to a desire for statutory predictability. Federal regulators have noticed. Speaking at Texas A&M School of Law’s Corporate Law Symposium in February, SEC Chairman Paul Atkins observed that “Texas has begun to build something that could offer an interesting alternative to Delaware,” and framed interstate competition for corporate charters as a healthy feature of American capital markets.[9]

Delaware’s position is not in near-term jeopardy. It retains more than a century’s head start in case law, judicial expertise and market familiarity, and Texas will need years of written opinions before its courts offer comparable predictability, to say nothing of the time required for a new exchange to win listings away from two entrenched incumbents. But that direction is becoming clearer, as the infrastructure is no longer theoretical. The court is deciding cases, the statutes are being enforced and the exchange is trading.

 

What This Means for Businesses — Including Those Far From Texas

A company does not need a headquarters in Dallas to feel these changes. For businesses negotiating significant contracts with Texas counterparties, forum-selection clauses deserve fresh attention: the $5 million threshold and the Business Court’s removal mechanism mean a dispute can land in the new forum whether or not the parties planned for it. For boards and investors evaluating where to incorporate, or facing pressure from shareholders or acquirers to consider it, the comparison between S.B. 29’s codified protections and Delaware’s judge-made doctrine is now a genuine legal analysis rather than a thought experiment, with real trade-offs running in both directions: Texas offers statutory clarity and management-friendly procedure, while Delaware still offers unmatched depth of precedent. And for issuers thinking ahead to the capital markets, TXSE’s listing standards and the incentives Texas has extended to companies that list on a Texas exchange, add a new dimension to going-public and dual-listing decisions.

 

Pastore LLC advises businesses, financial institutions, and executives on corporate governance, securities matters, and complex commercial litigation, and has attorneys who have been admitted to the Delaware courts for certain sophisticated matters and the Texas Bar.

[1] Tex. H.B. 19, 88th Leg., R.S. (2023) (codified at Tex. Gov’t Code Ch. 25A), https://capitol.texas.gov/BillLookup/Text.aspx?LegSess=88R&Bill=HB19.

[2] The Business Court, Tex. Jud. Branch, https://www.txcourts.gov/businesscourt/ (last accessed July 9, 2026).

[3] Tex. H.B. 40, 89th Leg., R.S. (2025) (amending Tex. Gov’t Code Ch. 25A).

[4] Tex. S.B. 29, 89th Leg., R.S. (2025) (amending the Tex. Bus. Orgs. Code).

[5] Gusinsky v Reynolds, 3:25-CV-1816-K, 2026 WL 747179, at *4-6 (N.D. Tex. Mar. 17, 2026).

[6] Tex. H.J.R. 4, 89th Leg., R.S. (2025) (approved by Texas voters Nov. 4, 2025); see also Texas Stock Exchange Begins Trading as Dallas Challenges Wall Street, Texas Policy Research (July 6, 2026), https://www.texaspolicyresearch.com/texas-stock-exchange-begins-trading-as-dallas-challenges-wall-street/.

[7] In the Matter of the Application of Texas Stock Exchange LLC for Registration as a National Securities Exchange, Exchange Act Release No. 34-104146 (Sept. 30, 2025), https://www.sec.gov/files/rules/other/2025/34-104146.pdf; TXSE Production Launch and Market Activation, Texas Stock Exchange, https://www.txse.com/alerts/txse-2026-002 (last accessed July 9, 2026).

[8] Paul Cobler, Texas Stock Exchange to launch trading Monday, The Texas Tribune (July 3, 2026), https://www.texastribune.org/2026/07/03/texas-stock-exchange-launch-trading/.

[9] Paul S. Atkins, Remarks on Revitalizing U.S. Capital Markets and State Competition in Corporate Law, Texas A&M School of Law Corporate Law Symposium (Feb. 17, 2026), republished at Harvard Law School Forum on Corporate Governance, https://corpgov.law.harvard.edu/2026/02/18/remarks-by-chair-atkins-on-revitalizing-u-s-capital-markets-and-state-competition-in-corporate-law/.

Tags: Delaware, Pastore LLC, Texas, Texas Business Court, Texas Stock Exchange