What is a DIN?
A DIN is a unique fifteen-digit identifier given to a director or a person who intends on becoming a director that, once issued, will remain with that person for life.
In June 2020, the Australian Government introduced the Treasury Laws Amendment (Registries Modernisation and Other Measures) Act 2020 (cth). Within it was the introduction of a new regime to Part 9.1A of the Corporations Act 2001 (cth), which requires all company directors or anyone who intends on becoming a director to obtain a DIN.
Why have DINs been implemented?
At the request of the Australian Taxation Office (ATO), Fair Work Ombudsmen (FWO) and the Australian Securities and Investments Commission (ASIC), a joint report was released in 2018, prepared by PricewaterhouseCoopers Consulting. This report estimated that the net effect on the Australian economy of potential illegal phoenix activity was between $1.8 billion and $3.5 billion in lost gross domestic product each year.
Given the substantial impact this activity has on the overall national business environment, it is understandable that one of the federal governments reasons for introducing DINs centres on making it more difficult for people to use fraudulent director identities, which have commonly been linked to the unlawful phoenixing of businesses.
It was also envisaged that it would make it easier for external administrators and regulators to trace directors' relationships with companies over time. As a result, if a corporate failure occurs, it follows that by ensuring that each director has provided sufficient identification to obtain a DIN, they may be held more readily accountable for any unlawful activity they may have been a part of as a director.
The Australian Business Registry Services (ABRS) is responsible for the administration and the implementation of DINs, while ASIC is responsible for the enforcement of any offences that may be pursuable about non-compliance by directors.
How long do current directors have to obtain a DIN?
If a director was appointed before 1 November 2021 and does not accept any new directorship appointments post that date, they have until 30 November 2022 to apply for a DIN.
What about new directors?
From 1 November 2021, all new directors must apply for a DIN within twenty-eight days (28) of their appointment to a corporation.
From 5 April 2022, all new directors must apply for and obtain a DIN before being appointed as a director of a Company, registered Australian body, a registered foreign company or Aboriginal or Torres Strait Islander Corporation.
How do you apply for a DIN?
DINs can be applied for at the ABRS website - https://www.abrs.gov.au/director-identification-number/apply-director-identification-number
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