New Director Identification Number Requirements Coming Soon

From November 2021, directors will be able to apply for a Director Identification Number (Director ID), in an effort to prevent the use of false or fraudulent director identities and prevent director involvement in other unlawful behaviours, such as illegal "phoenix" activity. A Director ID is a 15 digit unique identifier given to a director, or someone who intends to become a director, to trace their relationships to companies over time. A director will only need to apply for a Director ID once and will keep the same Director ID forever. The newly established Australian Business Registry (ABRS) is in charge of implementing the Director ID initiative, centralising more than 30 existing ASIC registers and the Australian Business Register.

Who needs to apply for a Director ID and when?

A person will need to apply for a Director ID if they're an "eligible officer" of:

• a company, a registered Australian body or a registered foreign company under the Corporations Act 2001 (Corporations Act); or
• an Aboriginal and Torres Strait Islander corporation registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act).

An "eligible officer" is a person who is appointed as a director, or an alternate director who is acting in that capacity. A person who is not an "eligible officer" may apply for a Director ID if the person intends to become a director within 12 months of applying. A company secretary who is not a director will not need to apply. The date of appointment as a director determines when a Director ID must be applied for. For Corporations Act directors:

Appointment date	Date you must apply for Director ID
On or before 31 October 2021	By 30 November 2022
Between 1 November 2021 and 4 April 2022	Within 28 days of appointment
From 5 April 2022	Before appointment

For CATSI Act directors:

Appointment date	Date you must apply for Director ID
On or before 31 October 2021	By 30 November 2023
Between 1 November 2022	Before appointment

How to apply for a Director ID

The ABRS website contains a useful guide on how to apply for a Director ID. Directors will need to personally apply for their Director ID as they are required to verify their identity.

What are the new obligations?

A director must provide their Director ID to the company's record holder. The company's record holder could be the secretary, another director, contact person or authorised agent of the company. If the director is appointed as a director of another company, the director will also need to give their Director ID to the record holder of the other company. Any changes to the information attached to a Director ID must be notified to the ABRS. Additional obligations a director has include:

• applying for a Director ID if directed by the ABRS to do so;
• not applying for more than one Director ID; and
• not misrepresenting their Director ID information to another person or company.

Directors may be issued with an infringement notice and be subject to civil or criminal penalties for failing to comply with the new obligations.

Need more guidance?

If you would like to find out more on what the new Director ID requirements mean for you, or need guidance or assistance to ensure compliance with the changes, please contact Hunt & Hunt's commercial team for further information.

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~ by' Peter Huang,' Graduate-at-Law