All countries have specific legal requirements for citizens of other countries who want to open businesses on their sovereign soil, and Australia is no different. Fortunately, the Australian government welcomes foreign investment of all kinds and does its best to register a business as simple as possible.
Clear and concise information is readily available to potential business owners and investors. People who have done business in the United Kingdom or the United States will find that Australia’s business and corporate laws are very similar to those countries because of shared cultural roots. At the beginning of the process, two basic legal requirements are a physical address for the company you wish to start and a resident director in Australia. Once you have a nominee director, the address requirement is solved.
Any foreign individual or overseas company that isn’t resident in Australia has to have a resident director within Australia to conduct business legally. Under the Corporations Act 2001-Sect 201A, both proprietary companies and public companies need these nominee directors by law. For a proprietary company, the requirement is at least one resident director. In the case of public companies, they require at least three, two of which must reside in Australia.
The resident director is a non-executive role that becomes the official meeting point between the overseas client and the Australian government. The director manages all contact between the company and all the governmental regulatory agencies that may be involved in conducting the said business.
The resident director’s role may be large or small, depending on the nature and complexities of the business you wish to open. They can navigate through the government red-tape and advise you on the best actions to take to reach your goal, a functioning and profitable business. For the initial setup, this help is vital to avoid delays and ensure compliance with your business’s legal requirements.
The first thing a nominee or resident director will do is advise you on which type of business entity you should register. The four basic types of business entities are an individual trader, a company, a partnership, and trust. Each of these structures involves different kinds of processes and requirements. To operate as a foreign company on Australian soil, you must be registered with the Australian Securities and Investments Commission (ASIC). All four types of businesses require different tax structures and insurance obligations. The second requirement is to obtain an Australian Business Number – ABN. This enables you to open bank accounts in the company name, obtain import/export licenses and insurance.
The requirements to become a resident director for an overseas-based company are quite simple. The person has to be eighteen years of age or over and be a permanent resident of Australia. They must consent to be a representative of the said company and willing to take on the legal responsibilities of a director of that company’s legal obligations. It is perfectly legal for a company to appoint an employee, someone who works for the company and already resides in Australia, to become their legal resident director. This, of course, will depend on the nominee’s capability to carry out all the necessary legal requirements of setting up a company in Australia and complying with government regulations.
Some lawyers or accountants also offer this type of service, but for most of them, this is a commercial side-line. It is much better to choose a company that is solely dedicated to this kind of service. That way, the service is fully committed to seeing your needs without the distraction of other concerns. The other advantages are
- An agreed-upon flat annual fee covers all work required, so there aren’t any hidden or added charges.
- Your business has an official address.
- Knowledge of local banking regulations and updates on rules.
- Twenty-four-hour cost-effective foreign money transfers, whether depositing or withdrawing.
- No inconvenience because of different time zones.
- Response to communications instantly via telephone, email, or video conference.
Any overseas-based businessperson or company who wishes to open a business in Australia would be advised to contact a professional resident director service to become their legal representative. As there isn’t any way around this governmental requirement, it is better to hire a firm dedicated to this type of expert service. A good firm will offer a full package of services that includes accounting, taxation, and business development. Local knowledge, finance, and contacts will be at your fingertips when you engage a company as a resident director.
This is a Contributor Post. Opinions expressed here are opinions of the Contributor. Influencive does not endorse or review brands mentioned; does not and cannot investigate relationships with brands, products, and people mentioned and is up to the Contributor to disclose. Contributors, amongst other accounts and articles may be professional fee-based.