The Director Identification Number (DIN) regime started on 1 November 2021
The new “Director Identification Number” or “DIN” regime has at last commenced following the establishment of the new regulator, Australian Business Registry Services (“ABRS”).
Under the new regime, every Australian company director is required to have a DIN which is a 15-digit lifetime unique identifier. Applications for DINs can now be made.
As foreshadowed in our article “DINs for life – The introduction of Director Identification Numbers” the new DIN regime, which was established by federal laws[i] passed in June 2020, has commenced.
Significant civil and criminal penalties may apply for non-compliance with the DIN obligations and the Registrar of the ABRS may issue infringement notices.
Who needs a DIN?
A person who is appointed to the position of:
- director, or
- alternate director and is acting in that capacity,
(called an “eligible officer” in the new DIN provisions in the Corporations Act 2001 (Cth) (“Corporations Act”) but in this article called a “director”) of:
- an Australian company
- a registered Australian body (such as a State or Territory incorporated association that is registered with ASIC and has an Australian Registered Body Number)
- a foreign company registered with ASIC
- an Aboriginal and Torres Strait Islander corporation registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth),
(each in this article called a “company”) must have a DIN. An offence based on breach of this requirement is an offence of strict liability and a person who contravenes the requirement or is involved in a contravention may be liable to a civil penalty.
A person who is not already a director may apply for a DIN if they intend to become a director within 12 months after applying.
All other eligibility requirements to be appointed as a company director still apply.
Currently the DIN requirements only apply to formally appointed directors and do not extend to persons commonly referred to as “de facto” or “shadow” directors.
Time period to obtain a DIN
The deadline dates for obtaining a DIN are:
|Type of director||Date of appointment||Deadline to obtain DIN|
|A director of an Aboriginal and Torres Strait Islander corporation (a “CATSI director”)||Before 31 October 2021|
1 November 2021 to 4 April 2022
5 April 2022 onwards
|30 November 2023|
Within 28 days of being appointed
|Other director||Before 31 October 2021|
1 November 2021 to 4 April 2022
5 April 2022 onwards
|30 November 2022|
Within 28 days of being appointed
The requirement to apply either within 28 days of appointment (1 November 2021 to 4 April 2022) or before appointment (5 April 2022 onwards) applies to a new appointment even if the director was already a director of a company on 1 November 2021 and would otherwise have had until 30 November 2022 (or 30 November 2023 for a CATSI director) to apply.
A person who was already a director on 1 November 2021 who knows they will cease to be a director of any company before 30 November 2022 (or 30 November 2023 for a CATSI director) may obtain a DIN before 30 November 2022 (or 30 November 2023 for a CATSI director) at a time while they are still a director but need not do so, unless and until they intend to become a director of another company within 12 months of making the application.
Extension of time to obtain a DIN
A director will not be required to have a DIN at the time of their appointment if:
- they applied for a DIN before first becoming a director and the application and any reviews arising out of it have not been determined or otherwise disposed of when they are appointed; or
- they apply after being appointed, within a period allowed by the Registrar; or
- they apply after being appointed, within a period allowed by regulations.[ii]
The evidential burden to prove those matters falls on the director. In relation to an application to the Registrar for an extension of time to apply, the Explanatory Memorandum states that the Registrar would exercise the discretion to extend the time for making a DIN application in a particular case “where warranted” and gives the example that the power could be applied to the benefit of directors residing in very remote areas should that remoteness affect their ability to apply for a DIN prior to appointment. It may be taken from this statement, that extensions from the Registrar may not be easily obtained.
Applying for a DIN
Applications for a DIN must meet any requirements of the data standards made by the Registrar. The Registrar has made a data standard for DINs (the “data standard”).[iii]
Applications can be made online, by phone or by paper. There is no fee. Due to the identity verification requirements, directors must make their own application and no one can apply on their behalf.
To obtain a DIN online, the applicant must already have a MyGovID with a Standard or Strong identity strength (see the MyGovID website). We’ve used the online application processes[iv] to obtain a MyGovID and DIN and they are straightforward and quick for an applicant with an average level of computer skills, an email address and a “smart” phone. If your smart phone has a camera you can obtain a MyGovID with a Strong identity strength using a “selfie” for face verification against the photo identification document lodged with your application.
Persons who are unable to set up a myGovID online, can apply by phone or on a paper form. Overseas based directors will have to lodge a paper application form together with certified copies of identification documents and English translations.
The Corporations Act and the data standard specifically provide that applicants cannot be compelled to provide their tax file number.
Current prohibitions against providing false or misleading information apply to DIN applications.
Providing the DIN to companies
Currently, there is no requirement on the director to give their DIN to ASIC or the company, or even to inform the company that they have obtained one. There is no prohibition on a company appointing a director without first being informed of the director’s DIN or that the director has a DIN.
However, for practical purposes, given the potential penalties for directors who breach these requirements, it would be prudent and sensible for companies to advise potential directors about the DIN requirement as early as practicable before appointing them.
ASIC has stated that the ASIC companies register will be transferred to the ABRS, which is expected to occur in September 2023 and from that time, DINs will need to be linked to companies.[v] This would mean that DINs will have to be provided for initial directors to be included in applications for registration of companies as well as when lodging notice of appointment of a new director.
Updating a DIN
Personal details for the DIN can be updated online via the ABRS website and MyGovID or by phone or paper form. While there is no specific obligation in the Corporations Act or the data standard for a director to update their personal details in their DIN record, other than to correct any incorrect information in the application, the data standard permits the Registrar to require updated information to be provided.
The existing obligations for directors to advise the company of changes to their personal details and for companies to advise ASIC of those changes (other than ACNC-registered charities who are only required to notify the ACNC of changes to details of responsible officers) continue to apply.
Privacy of a DIN
Information collected under the data standard is “protected information” under the Corporations Act and is subject to the secrecy and disclosure provisions in Part 9.1 of the Corporations Act. The Registrar may disclose information relating to a person’s DIN as permitted under that Part.[vi]
Cancellation of a DIN
Once a person has a DIN, their DIN will remain valid for life even if they stop being a director, become a director of a different company, change name or address or become disqualified from being a director. However, if a person who is not already an eligible officer when they obtain a DIN does not become an eligible officer within 12 months of obtaining their DIN, the DIN will be automatically cancelled.
The new regime may present practical challenges for directors, potential directors and companies if proper planning is not in place. From 5 April 2022, a person will not be able to be appointed as a director “on the spot” to fill a casual vacancy or cover for an absent director if the proposed appointee does not already have a DIN. A person will not be able to stand for election as a director if the candidate does not have a DIN when the election is held.
Existing directors as at 31 October 2021 who are required to retire and stand for re-election before 30 November 2022 (or 30 November 2023 for CATSI directors) are, if re-elected, in effect, re-appointed as a director and must therefore obtain a DIN before the election is held (for an election from 5 April 2022).
The DIN is the first registry to be established and administered by the ABRS and by 2024 the ABRS will take over as the registry (and collector of fees) for 34 registers currently administered by ASIC under various legislation and the Australian Business Register (ABR) currently administered by the Commissioner for Taxation. Additional Commonwealth registers may be brought into the new regime by future legislative reforms.
While the ABRS will administer these registers, the registrars for different registers may be different Commonwealth bodies. So far, the Commissioner for Taxation has been appointed as Registrar of the ABRS in relation to business names registration and the companies register and other registers kept under the Corporations Act (including DINs), the new Commonwealth Registers Act 2020 (Cth) and the National Consumer Credit Protection Act 2009 (Cth).
It is not proposed that the ACNC charity register will be administered by the ABRS.
Effect on ACNC charities and their directors
The new DIN regime applies to all directors, even if the company is an ACNC-registered charity. The provisions of the Corporation Act that are “switched-off” for ACNC-registered charities are not affected.
New director appointments for ACNC-registered charities need not be notified to ASIC, only to the ACNC. As yet, there is no public information as to how DIN notification requirements will apply to ACNC-registered charity directors.
- All current and new directors of companies and Aboriginal and Torres Strait Islander corporations, including those that are ACNC-registered charities, are required to have a DIN.
- Transitional periods to obtain a DIN apply to current directors as at 1 November 2021 and new director appointments from 1 November 2021 up to 5 April 2022 and from that date, all persons (including those who are already directors) must have a DIN before being appointed or re-appointed as a director.
- It is the director’s personal responsibility to obtain a DIN.
- There are substantial criminal and civil penalties for failing to comply with obligations under the new regime.
- Currently there is no requirement for a director to inform a company of their DIN or for a company to obtain a new director’s DIN. This will change when responsibility for the register of companies is transferred from ASIC to the ABRS.
If you are unsure of what your obligations are under this new regime, please seek legal advice. You can contact us on (07) 3160 0010 or at firstname.lastname@example.org
[i] *Schedule 2 to the Treasury Laws Amendment (Registries Modernisation and Other Measures) Bill 2019 amending the Corporations Act 2001 (Cth) and the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) for the purposes of DINs and the Commonwealth Registers Act 2019 (Cth) which established the ABRS.
[ii] At the date of this publication there is no regulation relating to extensions of time for applying for a DIN under section 1272C(2)(ii) of the Corporations Act.
[iii] Corporations Director Identification Number Data Standard 2021 issued 15 April 2021.
[vi] The Registrar has, as permitted by section 1270K of the Corporations Act, by legislative instrument, made a disclosure framework relating to disclosing protected information. See Corporations (Director Identification Number) Disclosure Framework (PGPA Bodies, Courts and Tribunals) 2021, issued 15 April 2021.
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The material distributed is general information only. The information supplied is not and is not intended to be, legal or other professional advice, nor should it be relied upon as such. You should seek legal or professional advice in relation to your specific situation.