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A collection of updates, articles and papers written by The Little CFO & The Little CFO Legal

New directors: you must now have a 'Director Identification Number' before your appointment.

From today, 5 April 2022, onwards all individuals being appointed as a director for the first time under the Corporations Act 2001 must first have a Director Identification Number (Director ID) from the Australian Business Registry Services (ABRS).

What is a Director ID?

A director ID is a unique identifier given to a director who has verified their identity with the ABRS. The new requirement aims to prevent the use of false or fraudulent director identities.

Why has the law changed?

All directors are required by law to verify their identity with ABRS before receiving a director ID. This is intended to:

  • prevent the use of false or fraudulent director identities

  • make it easier for external administrators and regulators to trace directors’ relationships with companies over time

  • identify and eliminate director involvement in unlawful activity, such as illegal phoenix activity.

What is my deadline?

The relevant deadline to have your Director ID depends on the date you were first appointed as a director and the applicable law:


A - Registered under Corporations Act 2001

For directors of a company, registered Australian body or registered foreign company:

  1. If you will be appointed from 5 April 2022 onwards, then you must have a Director ID Number beforehand.

  2. If you will be appointed between 1 Nov 2021 and 4 Apr 2022, then within 28 days of appointment.

  3. If you were appointed prior to 1 Nov 2021, then by 30 Nov 2022.

B - Registered under the Corporations Aboriginal and Torres Strait Islander (CATSI) Act 2006

For directors of Aboriginal and Torres Strait Islander corporation companies:

  • If you were appointed on or before 31 October 2022, then by 30 November 2023.

  • If you will be appointed from 1 Nov 2022 onwards, then you must have a Director ID Number beforehand.

Do I need to apply for a Director ID?

You need a director ID if you're a director of any of the following:

  • a company,

  • an Aboriginal and Torres Strait Islander corporation,

  • a corporate trustee (for example, of a self-managed super fund, charity or not-for-profit organisation that is a company or Aboriginal and Torres Strait Islander corporation),

  • a registered Australian body (for example, an incorporated association that is registered with ASIC and trades outside the state or territory in which it is incorporated),

  • a foreign company registered with ASIC and carrying on business in Australia (regardless of where you live).

You do not need a Director ID if you are:

  • a company secretary but not a director;

  • acting as an external administrator of a company;

  • running a business as a sole trader or partnership (including through a trust entity);

  • referred to as a ‘director’ in your job title but have not been appointed as a director under the Corporations Act or the CATSI Act (This has been our most common enquiry to date);

  • a director of a registered charity with an organisation type that is not registered with ASIC or ORIC to operate throughout Australia;

  • an officer of an unincorporated association, cooperative or incorporated association established under state or territory legislation, unless the organisation is also a registered Australian body.

How can find out if my organisation is ASIC registered?

If your organisation has an ABN, you can use ABN Lookup to find out if it is registered with ASIC as a:

  • company, which will have an Australian company number (ACN)

  • registered Australian body, which will have an Australian Registered Body Number (ARBN)

  • registered foreign company, which will have an ARBN.

Can my lawyer or accountant apply on my behalf?

Each individual needs to personally apply (not your accountant or lawyer) due to the verification of identity requirements.

How can I apply for my Director ID Number?

Go to ABRS website on this link.

How do I complete the ID Verification?

The Identity Verification component can be processed through your MyGovID app. This is the best option to get your Director ID without delays. Otherwise, a paper application is available. The details are available on this link.

What can happen if I don’t apply for my director ID Number in time?

It is a criminal offence if an individual does not apply for a Director ID by the deadline applicable to them. ASIC is responsible for enforcing director ID offences set out in the Corporations Act 2001 - view in this link.


Disclaimer​: Information on this website is of a general nature and is not to be relied upon as legal, financial, accounting, or other professional advice as the information provided does not consider your objectives, financial situation or needs. You should seek legal, financial, accounting, and such other professional advice as necessary or appropriate before making any financial, legal, or other decision. The Little CFO, The Little CFO Legal, their owners, affiliates, and the authors of the content & copy accept no responsibility, or any form of liability, arising from any reliance upon, reproduction or use of any information on this website, including where same is then shared in another format.

 

Should you require advice please connect with us so that we may provide advice tailored to suit your specific circumstances.

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