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Companies Acts Amendments

03 August 2015

From 1 May 2015 the registration requirements for the incorporation of New Zealand companies have been amended. The purpose of these amendments is to assist with the prevention of misuse of New Zealand Companies and provide additional powers to the Registrar of Companies. As with the enactment of the Anti-Money Laundering and Countering Financing of Terrorism Act 2009, these changes are consistent with the trend towards increasing the identification of the individuals and entities involved in commercial transactions in New Zealand.

What you need to know about the changes:

New company applications: All new companies will be required to provide the following as part of the application process:

  • At least one director who is:
    - resident in New Zealand; or
    - resident in Australia and also a director of an Australian incorporated company.
  • Details of every directors’ date and place of birth; and
  • Details of the company’s ultimate holding company, if applicable.

Existing companies: All existing companies (incorporated prior to 1 May 2015) will be required to provide the following:

  • From 1 May 2015 – Date and place of birth details of all new directors added to a company;
  • From 1 July 2015 – Date and place of birth details for every existing director as part of the filling of annual returns after 1 July 2015;
  • By 28 October 2015 – At least one director who is:

- resident in New Zealand; or
- resident in Australia and also a director of an Australian incorporated company.

It is important to note that details of a director’s date and place of birth will not be publicly available.

It will also be important to carefully consider the implications of being appointed a director of a company, especially where the primary purpose of your appointment is to satisfy these new requirements. This could be the case where an overseas holding company wishes to appoint a New Zealand resident employee as a director of its New Zealand based subsidiary. All directors, regardless of the purpose of their appointment will owe duties to the company, the company’s shareholders and other persons dealing with the company. These statutory duties can not be contracted out of. As a director you must be actively engaged in the management of the company and ensure you have sufficient information and authority to enable you to discharge your duties. Accepting a role as a director in the absence of this places you in a precarious position with an increased risk of personal liability.

 

Phil Hyde is an Associate in the Commercial Corporate team at Norris Ward McKinnon. Phil can be contacted at phil.hyde@nwm.co.nz

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