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16.Who can be appointed Company Director?

A person may be appointed as Company Director provided they satisfy the general requirements and are not restricted under Corporations Law as a disqualified person.
 

General requirements

The only legal requirement is that a director is 18 years of age and they provide written consent prior to their appointment. Generally directors are appointed upon approval at a shareholders’ general meeting, or directors can also approve the appointment of new directors once established.

There are also residency requirements the company must comply with. Proprietary companies must have at least 1 director who is a resident of Australia, and a public company must have at least 2. Whether a director “ordinarily resides” in Australia is sometimes not easy to determine because it’s not defined under Corporations law, and no guidance is provided by ASIC. There are factors the courts use to assist in determining a person’s residency, but this should be reviewed by your advisor.
 

Disqualified from managing Corporations

A person cannot act as a director if they:

·         are an undischarged bankrupt;

·         have not complied with a personal insolvency agreement under Part X of the Bankruptcy Act; or

·         is convicted of various criminal offences such as fraud or offences under Company law, such as a breach of duties as a director or insolvent trading.

A person convicted of these offences cannot manage a company for at least five years (without court consent).

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