Discussion on ASIC key
Task: What is ASIC key?
When a person wants to register his company, he or she needs to file an application to the ASIC that is the Australian Securities & Investment Commission. ASIC key plays an important part in forming a company. The present paper will discuss about the ASIC key, its importance, how it is connected to ASIC Connect and the important sections of the Corporations Act 2001 which help a person in registering his or her company. ASIC key is a special number which is used while connecting to ASIC connect. It helps the new business registers in protecting their information’s related to the business. The ASIC key gives an assurance to the newly business holders about personal accessibility of business information’s. No other person can have an access to the business information until the business holder authorizes any such person to have an access to the confidential information.
Source: (Auskey and ASIC Connect, n.d)
Every business house will have its own ASIC key and through ASIC key they can update or their business details or can cancel any of the information mentioned. The ASIC key is send when a person wants to register his company or renew an existing company. The ASIC key can be sent to an upgraded address in case the existing address is incorrect.
How to link ASIC key with the ASIC Connect?
When a person wants to update about his business details, he or she needs to check whether the name of the company has been linked with the account or not. If the name of the business appears on the lodgment and notifications tab of the ASIC connect then it gives a confirmation that the company name has been linked with the account number. In case it does not appear then the person needs to use his or her ASIC key to link the name of the company (ASIC key (n.d.). Firstly the person has to visit the website of ASIC. He will see ASIC connect box which will take him to ASIC connect. There the person needs to login and in case he or she has not created an account then he needs to choose the option of signup. Once the account has been logged in the person will choose the option do it now and he will be able to see an option asking for link a business or request ASIC key. Once all the information has been submitted, the name of company will be linked to the account. ASIC key can be sent through mail or by post.
In order to study about the Australian Securities & Investment Commission (ASIC), it is important to study some of the important sections of the Corporations Act 2001 which have been discussed below:
Section 117 of the Corporations Act has information related to ASIC. The first step mentioned under the section is to register the company.
Once the registration has been done, the next step is to determine the type of company. Section 112 of the Corporations Act 2001 deals with different types of companies. For the present work, Proprietary Limited Company has been taken into consideration.
Type of Company: Proprietary Limited Company (as per the details mentioned under section 112 of the Corporations Act)
After the type of company has been decided, it is required to be read with the section 601 under chapter 5B of the Corporations Act (Commonwealth Consolidated Acts, 2001):
1) The section makes the registered company subjected to sub clause (2)
2) In case the registered body is same with one of the Australian registered bodies then the above mentioned section is not applicable on the place from where the business carries on its business. The section applies to the place from where the business has originated or the place from where it originated.
Section 601 CW of the Corporations Act informs about affixing the name of the company in a painted form. It is a duty of all the registered companies to affix its name in a readable and clear format. The name must be written outside the premise of the building from where the business is being carried out and also at the place where the company has been registered. So, the name of the registered body must be clearly written accompanied with its place of origin. Display of both the information’s in front of the premise is compulsory. When a company holds a limited or a proprietary nature then it is necessary for the company to add either limited or private at the end of the name. The addition may be used in an abbreviated form as well like using Ltd. or Pvt.
When a person wants to register his or her company, it is necessary that he reads section 112 of the Corporations Act in order to decide the type of company he or she wants to incorporate. Section 112 of the Corporations Act helps in gaining knowledge about different types of companies. Section 113 of the Corporations Act deals with proprietary companies, one that has been established in the present paper and it is mandatory to read all the clauses (Commonwealth Consolidated Acts, 2001).
Once the company has been registered it is important to indicate the liabilities of all the members with the name of the registered company. It is important to choose a unique name of the company and it should be ensured that no other company has been registered with the same name. Adding the required suffix with the name of the registered company is also an important part and an essential step in the formation of the company (Kathrine and Rosanne, 2011).
Choosing a correct name is also an important factor to register the company as there are times when it is not approved by ASIC that is the Australian Securities & Investment Commission (Bird, Ramsay, Chow and Lenne, 2004). The rejection by the Australian Securities & Investment Commission may happen when it thinks that the name is similar to one of the working business company. The Australian Securities & Investment Commission may also reject the name of a company in case it feels an offensive or illegal motive behind selecting the name. When Australian Securities & Investment Commission rejects the name of any company, it provides some suggestions that can be made in the name to get an approval. A person may follow the suggestion and amend the name to get an instant approval.
A company may also be registered by using an abbreviation with the name of the company like using ACN or ABN. ACN stands for Australia company number and ABN stands for Australian business numbers.
Once the name has been chosen and has been approved by the Australian Securities & Investment Commission (ASIC) (Bird, Ramsay, Chow and Lenne, 2004), the next step is to take the consent from all the members and the consent must be valid. The Corporations Act requires a valid consent from all the members being associated with the company at the time of registration.
Every member who wants to join the company or whose names appear on the registration list needs to provide a valid consent (Kathrine and Rosanne, 2011). The below persons are required to provide a valid consent:
- The directors of the registered company need to provide their valid consent and they should have attained an age of 18 years.
- The secretary of the registered company needs to provide his or her valid consent and he or she should have attained the age of 18 years.
- The members of the registered company need to provide their valid consent and they should have attained an age of 18 years.
It is to be noted that in a proprietary type of company there is no mandatory requirement for a secretary to be appointed. Presence of the directors is enough to establish the company. It such scenario one of the directors must be a citizen of Australia and have an Australian citizenship.
Once the consent of all the members of the registered company has been taken and validated, registration of the company needs to be performed. The below mentioned process will help in registering the company as mentioned under section 601BC of the Corporations Act 2001:
- Filling personal details
- Name of the company
- The type of the company
- Allotted designations
- Personal as well as the official address
- Residential, official and personal phone numbers of all the members
- Details about the company to be registered
- Suggesting the name of the company ( there is a possibility of the name not being approved so different names are to be suggested as per the preference)
- The type of suffix to be added at the end of the name of the company
- Mentioning the date of incorporation
- Stating the address of the company where it is to be registered
- Stating the address of the business unit from where the activities are to be carried
- Stating about the acting superannuation trustee
- Stating whether seal is required or not
- Disclosure about the shares
- The amount of guarantee
- Mentioning the state wherein the company is to be registered
- Stating the residential address of all the members
- If the registered address of the company belongs to some other person then his or her consent needs to be attached
- Updating whether the registered company has been registered in Australia or not with the submission of its ABN, ACN or ARBN number
All the terms and conditions mentioned in the registrations procedure needs to be followed and accepted.
Once the registration is complete, the company needs to constitute a constitution as per the criteria mentioned under section 136 of the Corporations Act 2001 and needs to disclose its internal management under section 134 of the Corporations Act 2001.The constitution is all about the members verifying and agreeing to the terms and conditions at the time of registration. The internal management is managed by the terms and conditions mentioned under the Act.
In this paper, Proprietary Limited Company has been registered and this type of company does not require setting up of a constitution. Section 178C of the Corporations Act 2001 states about the shares of the proprietary company and its division into different classes.
Section 124 of the Corporations Act deals with legal capacity of the company and its powers. The section states about the rights and obligations of the registered company. It plays a critical role in the formulation of the company. It gives power to issue and cancel any type of shares and debentures. The company may grant a security interest and its legal status allows it to act in good faith.
Section 129 of the Corporations Act states about the assumptions related to the constitution of the company although proprietary limited company does not require any constitution. A person will always assume the facts mentioned and the appointments done as per the process for e.g. a person may assume that appoint of the director has been made as per the process (Ramsay and Webster, 2017). Under this section the company has been empowered to replace certain rules and regulations to make some important changes when it is necessary.
Section 588(m) of the Corporations Act states about the recovery of losses which results when the company becomes insolvent. When a company becomes insolvent, the creditors are the people who are majorly affected as are the ones making huge investments. As per the section, the losses are to be recovered from the directors and paid back to the creditors. The person who has been involved in the liquidating process that is the liquidator may also recover his losses from the directors. It is to be noted that the section may come into function within 6 years since the process of winding up begins.
The above mentioned information is important to be considered by all such persons who want his or her company to come into existence. The sections mentioned above are some of the important sections that need to be studied by all the persons who are looking to form a company. Having an ASIC key is important in order to make the company identifiable and to protect the details about the company.
ASIC key (n.d.). Retrieved from: https://asic.gov.au/online-services/online-keys/asic-key/
Auskey and ASIC Connect, (n.d). Retrieved from: https://asic.gov.au/online-services/online-keys/auskey/auskey-and-asic-connect/
Bird, H. L., Ramsay, I., Chow, D and Lenne, J. (2004) ASIC Enforcement Patterns. U of Melbourne, Public Law Research Paper No. 71, p. 132. Available at SSRN: https://ssrn.com/abstract=530383
Commonwealth Consolidated Acts, 2001. Retrieved from: http://www5.austlii.edu.au/au/legis/cth/consol_act/ca2001172/
Kathrine, M and Rosanne, B. (2011) Changes to business name registration in Australia. Keeping Good Companies, 63(1), pp.24-25.
Ramsay, I and Webster, M. (2017) ASIC Enforcement Outcomes: Trends and Analysis. Company and Securities Law Journal, 35(5), pp.289-321.
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