New requirements for directors
Requirement for director identification number
Company directors need to verify their identity as part of a new director identification number (DIN) requirement. A DIN is a 15-digit unique identifier that a director will apply for once and keep forever – which will help prevent illegal “phoenixing” activities and the use of false or fraudulent director identities.
A DIN starts with 036 (the 3-digit country code for Australia under International Standard ISO 3166) and ends with an 11-digit number and one ‘check’ digit for error detection.
All directors (and alternate directors) of a company, registered Australian body, registered foreign company or Aboriginal and Torres Strait Islander corporation will need to obtain a DIN. At this stage, DINs will not be required for company secretaries or members of a board or management committee of an incorporated association (unless the association is also registered under the Corporations Act as a registered Australian body).
When to apply for DIN
When you must apply for a DIN depends on when you are appointed as a director and which legislation applies to the company or corporation of which you are a director.
Directors of companies and Australian bodies registered under the Corporations Act
- Directors appointed on or before 31 October 2021 have until 30 November 2022 to apply.
- Directors appointed between 1 November 2021 and 4 April 2022 must apply within 28 days of their appointment.
- Directors appointed from 5 April 2022 must apply before being appointed.
Directors of corporations registered under the under the Corporations (Aboriginal and Torres Strait Islander Act)
- Directors appointed on or before 31 October 2022 have until 30 November 2023 to apply.
- Directors appointed from 1 November 2022 must apply before being appointed.
How to apply for DIN
A director will need to apply for their own DIN because they will need to verify their identity. No one can apply on their behalf unless the Registrar is satisfied that the director is unable to make the application on their own behalf.
Applications can be made through the Australian Business Registry Services (ARBS) website at https://www.abrs.gov.au/director-identification-number/apply-director-identification-number. Directors will need to have a myGovID to make the required application.
Directors without Australian identity documents or access to mygovID will need to apply in paper form and provide appropriate identity documents. More information about this can be found at https://www.abrs.gov.au/director-identification-number/apply-director-identification-number/verify-your-identity.
What happens then?
Currently there is no requirement to provide your DIN to ASIC or to the companies you’re a director of. The ASIC companies register is expected to be transferred to the ABRS in September 2023 and this is when your DIN will need to be linked to the companies you’re a director of.
What happens if I don’t apply for a DIN?
Any director failing to apply for a DIN when required to do so risks civil and criminal penalties.
Civil and criminal penalties will also apply where individuals:
- misrepresent or provide a false a DIN to a government body or registered body;
- knowingly apply for multiple DINs; or
- are actively involved in the contravention of any of the above offences.
These penalties include fines ranging from $13,200 and civil penalties up to $1,100,000 and imprisonment for a term of up to 12 months.
For more information in relation to this article please contact Johanna Churchill on +61 8 8210 1236 or jchurchill@normans.com.au or Stephen King on +61 8 8217 1308 or sking@normans.com.au.
