When do you have to register for a Director Identification Number? It could be now.

Australia’s Director Identification Number (Director IDlegislation was passed into law in June 2020, and from November 2021 existing and new directors are required to apply for a unique Director ID. 

Background 

A Director ID is unique 15 digit number provided to a person who successfully applies via Australian Business Registry Services (ABRS) for a number. A person only needs to obtain one Director ID as it remains with them for life. It is free to apply, and the registration can be updated if details such as company appointments and addresses change. 

The purpose of the Director ID regime is to facilitate confidence, promote good corporate conduct and to deter and penalise illegal phoenixing. The regime is set out in Part 9.1A of the Corporations Act 2001 (Cth) (the Corporations Act), and requires all eligible officers, being directors of bodies corporates, to apply to the ABRS for a unique Director ID 

Failure to apply for, and obtain, a unique Director ID is an offence under the Corporations Act and ASIC may seek orders against Directors who fail to do so.  

Who is required to have a Director ID? 

Directors of the following types of bodies corporate must apply for and obtain a Director ID: 

  • companies; 
  • charities or not-for-profit organisations incorporated as companies; 
  • Aboriginal and Torres Strait Islander companies; 
  • corporate trustees; 
  • registered Australian bodies; and  
  • foreign companies registered with ASIC and undertaking business in Australia (regardless of where the director in question lives). 

The following people are not required to obtain a Director ID: 

  • sole traders;
  • directors of incorporated associations (unless the body is also a registered Australian bodies);
  • partners in a partnership;
  • company secretaries who are not directors; 
  • external administrators; and
  • people with “director” in their title where they are not appointed under the Corporations Act. 

When do you need to apply for a Director ID 

The requirement for all eligible officers to obtain a Director ID will come into effect from 1 November 2021. 

For existing directors, appointed before 1 November 2021, they have until 30 November 2022 to apply. Directors of entities incorporated under the Corporations (Aboriginal and Torres Strait Islander Act) 2006 (Cth) (CATSI Act) have until 30 November 2023 to apply. 

For new director appointments, where the appointment is on or after 1 November 2021, the requirements are as follows: 

  • Directors of entities incorporated under the Corporations Act appointed on or before 4 April 2022, will need to apply for a Director ID within 28 days of their appointment; 
  • Directors of entities incorporated under the Corporations Act appointed from 5 April 2022, must apply for a Director ID prior to their appointment; and 
  • Directors of entities incorporated under the CATSI Act appointed from 1 November 2022, must apply for a Director ID prior to their appointment. 

How to apply? 

You can apply for a Director ID through the Australian Business Registry Services website. Details on how to apply can be found here.  

Corporate bodies that this legislation applies to should also consider implementing policies as part of the director election and nomination process to assist in ensuring the Director ID obligations are complied with. 

Contact Griffin Legal for relevant and up to date advice with relation to corporate governance and the introduction of the new Director ID scheme. 

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