Legislation amending the Corporations Act 2001 (Cth) has been passed, which will eventually require all current and new company directors to obtain and hold a Director Identification Number (DIN). The DIN will be a unique personal identifier for company directors and will follow the person it is assigned to permanently, regardless of which company(s) the person is a director of. DINs will never be re-issued or changed, except in extraordinary circumstances (such as a corruption of DIN records).
The purpose of the amendments is to enable better tracing of directors and their relationships across companies, to prevent fraud and other illegal activity such as phoenixing, and to simplify processes for company administrators and liquidators.
A date for the Commencement of the amendments has not yet been declared, but will come into effect no later than 23 June 2022.
Directors will initially be given a transitional period within which to apply to ASIC for a DIN. Once the regime is in full effect, new directors will need to apply for a DIN before they are appointed as director.
Proof of identity (100-point identity check) will need to accompany an application for a DIN.
Civil and criminal penalties for contravening DIN requirements will apply – for example, failure to obtain a DIN where required, making misrepresentations about a DIN or applying for an additional DIN (where the applicant already has a DIN). Failure to apply for or hold a DIN where required could also give rise to an infringement notice against the director.
Directors of companies, or persons intending to become a company director, should monitor these changes and the transition periods (once announced) to ensure they do not inadvertently breach the new DIN requirements.
We will continue to monitor these amendments and provide an update when further information is available.
This article provides general comments only. It does not purport to be legal advice. Before acting on the basis of any material contained in this article, we recommend that you seek professional advice.
Tasha Naige, Senior Associate in our Transactions Team
Direct Telephone: +61 8 8210 2244
Ryan Parker, Law Graduate in our Corporate Team
Direct Telephone: +61 8 8210 2235