Pursuant to the Corporations Director Identification Number Data Standard 2021, whether you are an existing director or will become a new director, you must now obtain, by yourself, your own director identification number (DIN) from the Australian Business Registry Services (ABRS).
The launch of the DIN has effects of targeting fraudulent activities such as “phoenixing”, where a director liquidates their old company which has incurred liabilities and debts, and then transfers its assets to form a new company and avoid paying its debts. As the previous legislation and technology could not verify company directors’ identification, it caused significant administrative burdens. The introduction of DIN requirements will ultimately minimise the waste of administrative resources and increase the traceability of the director’s relationships across companies. Further, regulators and relevant governmental authorities can also track directors’ failed companies and prevent the use of fictitious identities, prompting a fairer business environment.
What is a DIN?
A DIN is a unique identifier issued to a director for their lifetime that allows the ABRS to identify the director when he or she changes companies, stops being a director or changes their name and move interstate or overseas, etc. It is delivered as part of the Modernising Business Registers Program which was announced in 2020 and led by the Australian Taxation Office (ATO) in partnership with ASIC and other partnering agencies.
Who and When to Register DIN?
A new or existing director of a company will need to register for a DIN.
These companies include those which are:
registered under the Australian Corporations Act 2001(Cth);
registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006;
which are the charities or not-for-profit organisations that are public companies limited by guarantee.
From November 2021, a company director will be able to register for a DIN. The timeframe that a director must apply for a DIN depends on the date the person becomes to a director:
What does not change?
Despite the DIN requirements, the company notification requirements will remain the same without change. For example, company “directors must still notify their company of changes in address or other details. The company will still need to notify ASIC of any changes for the public record.”
In the occasions that directors fail to register their DIN by 30 November 2022, deliberately falsify their identity information, or register for multiple DINs, the offending directors will be issued an infringement notice or be subject to strict liability offences and face civil and/or criminal penalties.
If you are a company director, or are about to become one, and have concerns about your upcoming DIN application, please feel free to contact Longton Legal for assistance.
*Disclaimer: This is intended as general information only and not to be construed as legal advice. The above information is subject to changes over time. You should always seek professional advice before taking any course of action.*
Senior Associate | Accredited Property Law Specialist NSW | Nationally Accredited Mediator
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