Author: Li Weiping (Australia) LWPG Director of the law firm)

An increasing number of Chinese investors are coming to Australia to engage in business, investment, trade, and other economic and commercial activities. Establishing a company in Australia has become a key platform for conducting such investment and economic activities. This article will provide a brief overview of the responsibilities of directors in Australian companies.

Company Type

1. Private Limited Company —— This is in Australia, and it’s the most common type of company.

A private limited liability company can choose only A legal entity or individual shareholder holding all of the issued shares may also hold no more than 50 Non-employee shareholders of the name, again Add additional employee shareholders. A private limited company cannot engage in public fundraising. Such companies must have a registered office in Australia and at least... 1 A director who is ordinarily resident in Australia. The company may not necessarily have a secretary, but if it does, the secretary must be a resident of Australia. A private limited company typically has the suffix "Co., Ltd." after its company name. Pty Limited Characters or Pty Ltd The abbreviation 。

2. Public Joint-Stock Company —— These types of companies typically issue shares.

A public joint-stock company has no limit on the number of shareholders. It must... You must register a business address in Australia and have at least... 3 Famous director and 1 Corporate secretary. Two of the directors and the secretary The book must be permanently resident in Australia. After meeting the prescribed information disclosure and regulatory requirements, public joint-stock companies are permitted to raise funds from the market. Public joint-stock companies can also go public for financing. Companies of this type typically add the following to their company names: “Limited” Characters or “Ltd” The abbreviation 。

Director's Liability

Commonwealth of Australia Corporations Act No. Nine The provision defines the director of a company or other organization: “ Regardless of how this position is referred to, any person who has been elected to the status of director, or who has been appointed to serve as an acting director and exercises authority in that capacity, as well as any person who has not been duly elected as a director but nonetheless exercises authority in the capacity of director, or whose actions are habitually followed by the company’s directors in accordance with his instructions or wishes—shall be deemed a director. ” Thus, under Australian corporate law, directors include not only company directors who have been duly appointed by the shareholders’ meeting, but also so-called... “ De facto director ” and “ Shadow director ”。

Under the Australian Commonwealth Corporations Act and case law, the primary responsibilities of directors include:

1) The duty of prudence and diligence;

2) Act with sincerity the responsibility of;

3) The responsibility not to abuse one's official authority;

4) Do not misuse information. the responsibility of;

5) The responsibility to avoid conflicts of interest;

6) The responsibility for the consequences arising from the actions of its authorized personnel;

7) The responsibility to disclose significant personal interests;

8) The responsibility to retain and properly safeguard company documents; and

9) Liability for prohibited transactions (reverse transactions, illegal transactions).

Duties of Independent Directors

2003 Year 3 Month, Australian Securities Exchange (Australian Stock Exchange) The “Principles of Good Corporate Governance and Recommendations for Best Practices” issued by the Subordinate Corporate Governance Committee 2.1 It is stipulated that the majority of the board members should be independent non-executive directors (hereinafter referred to as...). ” Independent director ” ). Drawing on the U.S. system of external directors, Australia requires that the boards of directors of listed companies must consist of both executive directors and independent non-executive directors. Executive directors are full-time employees of the company, typically senior management personnel, whose primary responsibility is to oversee the day-to-day operations and management of the company’s business. Executive directors may also assume additional responsibilities under service contracts signed with the company. In contrast to executive directors, independent directors serve on a part-time basis, do not participate in the company’s daily operations and management, and have neither an employment relationship nor any material financial interests in the company. Their role is to provide independent judgment and advisory opinions on the board’s business decisions, rather than to be responsible for managing specific areas of the company’s business.

Independent directors must be independent, meaning they should be independent of the company’s management and should not have any commercial relationships or other material interests with the company’s management that could impede their ability to make judgments freely and independently, nor any other relationships that, for reasonable grounds, could be perceived as compromising their independent judgment. To ensure the independence of independent directors, they must meet the following conditions:

a. Not a major shareholder of the company or a member of its management team, and has no other direct relationship with the company’s major shareholders.