It is now a legal requirement that directors of a company, body corporate, registered Australian Body or registered foreign company, must have a director identification number (Director ID).
Any existing directors of a company must ensure that they apply for a Director ID by no later than 30 November 2022, to avoid facing both criminal and civil penalties. Any person, not already a director, but intending to become a director, must ensure they apply for a Director ID before appointment as a director.
A Director ID is unique 15-digit number provided to a director or a prospective director, which is used to verify the identity of a director. A director is only required to apply for a Director ID once, and that number will be permanently retained by that director forever. The single unique number will be used by a director, even if that director is a director of multiple entities.
Director ID’s have been implemented as a means of authenticating the identity of a director, and enabling a mechanism for tracking a director’s involvement in and relationship across various entities. By having a verified and traceable uniform system, which requires directors to be transparent about their identities, and which identifies a director’s interest as officeholder across various entities, this will hopefully assist to decrease the number of false or fraudulent director identities, as well as attempt to eliminate certain illegal activities by company directors, such as phoenixing. For more information on pheonixing, see our article Restructuring and Anti-Phoenixing Regimes.
A Director ID is applied for through the Australian Business Registry Services (ABRS). You can apply online through the ABRS or over the phone. The ABRS will require a director to prove their identity and will request information, including a director’s tax file number, residential address, identification documents (e.g driver licenses and passports), and secondary information (which can include, bank account details, superannuation account details, PAYG payment summary details etc). A director will need to ensure this information is available, in order to complete the application process. A director must apply for their Director ID themselves. There is no cost in applying for a director ID.
The requirement for a Director ID was first introduced in November 2021. Since the requirement was implemented, there has been a transition period for existing directors to apply. The deadline for all existing directors to apply for a Director ID is 30 November 2022. Any new directors intending to become a director of a company, must apply before becoming a director.
What happens if I don’t apply for a Director ID?
Directors who do not apply for a Director ID, or who do not apply for a Director ID within the relevant timeframes, may face civil and criminal sanctions. Sanctions under the Corporations Act 2001 (Cth) for failing to have a Directors ID when required, include criminal penalties of up to $13,200 and civil penalties of up to $1,100,000.
If you are a director of a company and you have not already applied for a Director ID, then you should attend to this urgently. If you, or anyone you know, has any questions, then you can contact our office on (02) 6188 3600.
If you have any questions in relation to Director IDs, please contact Ben Hatte of our Corporate and Commercial Team on 02 6188 3600