Australian Businesses Director ID Number Requests

From November 2021, directors of Australian companies will need to apply for and verify their identity as part of a new legal requirement for them to have a Director Identification Number (DIN). DIN applications will open from November 2021.

WHAT IS A DIN AND WHO NEEDS IT?

A DIN is a 15-digit identification number used by each eligible director as proof of their identity. An eligible director is a director or alternate director acting in this capacity:

• a company, Australian registered body or foreign company registered under the Companies Act 2001 (Companies Act); Where

• an Aboriginal and Torres Strait Islander society registered under the Societies (Aboriginal and Torres Strait Islander) Act, 2006 (CATSI law).

Charities and non-profit organizations that are limited liability companies (under the Companies Act) are therefore included in this regime. Directors of incorporated associations (including those registered with the Australian Charities and Nonprofit Commission) do not need to apply for a DIN, unless the incorporated association has a Australian registered organization number to operate outside of the state or territory in which it is incorporated.

Administrators will only need to submit one DIN application. They will keep their DIN forever even if they change companies, cease to be a director, change their name or move abroad. In addition, if an individual has applied for or received a DIN under one of these laws, they do not need to apply for a DIN under the other law.

The DIN regime was created for the purpose of promoting good corporate conduct, detecting, deterring and penalizing the involvement of directors in the illegal corporate phoenix (roughly when directors of a company transfer assets from company to a new company, in order to avoid litigation against the first company) and generally improve the integrity of company data. This will allow regulators and advisers to get a more complete picture of the history of a director and each company that director has been a part of. In addition, it will make it possible to see more clearly whether companies have participated in transactions with related parties and whether directors have had any conflicts of interest.

The DIN scheme will be administered by the recently established Australian Business Registry Services (ABRS), a program implemented by the Australian Tax Office (ATO).

DEADLINE TO APPLY

The deadline for submitting a DIN application differs depending on the date the director was appointed, as shown below:

If you cannot apply by the required date, you can request an extension. Information on how to request an extension will be available on the ABRS website in November.

WHAT DOES THE APPLICATION MEAN FOR AUSTRALIA-BASED DIRECTORS?

Administrators will be able to apply for their DIN from November 2021. They must apply for their DIN themselves, rather than having someone else do it on their behalf. The ABRS has provided preliminary information on the application process on its website, and further details will be released in November 2021.

Get myGovID

The ABRS currently recommends that administrators request a myGovID in anticipation of the opening of nominations. The myGovID should be a standard or strong identity force for the DIN application.

If you don’t have a myGovID, you can create one by following the instructions here. If you cannot obtain a myGovID, you can complete the DIN application over the phone or in paper form.

It should be noted that myGovID is different from myGov. MyGovID is an app you download to a smart device to prove who you are and connect to a range of government services, including myGov.

Prepare documentation

Until applications open, you can also make sure your documentation is ready. This will include:

• your tax file number (providing it is optional, however the ABRS website states that providing it will speed up the process);

• your residential address held by the ATO; and

• if you are completing an online application – information from two documents to verify your identity, such as bank details, ATO notice of assessment, super account details or dividend statement etc. (to find out more, click here).

Three ways to apply

Once the application is open, you will have three options:

• use your myGovID to log in and complete the application (the application link should be posted here in November 2021);

• complete the application by telephone – in addition to your tax file number (optional) and your residential address, you will need to answer two questions based on your known information about you and will need a primary identity document and ” a secondary identity document (find out more here); Where

• complete a paper application – in addition to the information requested on the form, you will need to provide certified copies of one primary identity document and two secondary documents (learn more here).

Once you have received your DIN, you must provide it to the company or legal entity that holds the CATSI Act register. This can be a company secretary, another administrator, a contact person or a company representative.

WHAT ABOUT DIRECTORS RESIDING OUTSIDE AUSTRALIA?

Administrators who reside outside of Australia can apply on paper from November 2021.

If you are applying on paper, the director will need to provide the information requested on the form (which has not yet been published) and will need to provide certified true copies of a primary identity document and a secondary document. If an administrator has changed their name, they will need to provide another document demonstrating the change.

The main documents include:

• foreign birth certificate;

• foreign passport;

• Australian full birth certificate; Where

• Australian passport (including passports expired within the last two years).

Secondary documents include:

• national identity card with photo;

• identification of a foreign government;

• driving license, provided that the address of the license matches the contact details given on your request; Where

• marriage certificate (however, if it is used to verify your name change, you cannot use it as a secondary document).

Details on how these documents are to be certified are given on the ABRS website: www.abr.gov.au.

WHAT ARE THE CONSEQUENCES OF NON-COMPLIANCE?

Directors who fail to comply with DIN’s obligations could receive a notice of infringement or face civil or criminal penalties. For example, it is an offense if a manager requests a DIN and knows he already has a DIN. It is also an offense for a director to intentionally represent to a company or a company governed by the CATSI Act a director identification number that is not that director identification number.

The ABRS is responsible for the implementation and administration of director credentials. ASIC will be responsible for the enforcement of related offenses.

BE PREPARED

All Australian companies must ensure that their directors (and alternate directors) are aware of the requirements and their obligations under this new regime. Directors should be encouraged to:

• gather the required personal identification documents (and in particular, the documents of their foreign administrators, which may take longer) so that applications can be submitted within the allotted time; and

• if they are based in Australia, apply for a myGovID (if they do not already have one) now in order to submit their DIN application.

This is particularly important for any new director appointed after November 1, 2021, as they must apply for their DIN within 28 days of being appointed, if they have not already done so. As shown in the table above, existing administrators have a longer grace period to submit a request.