The Corporations Act 2001 (the Act) was recently amended by the Corporations Legislation Amendment (Deregulatory and Other Measures) Act 2015 with effect from 19 March 2015.

The key amendments are as follows:-

1. Abolition of the ‘100 member rule’ – section 249D(1) of the Act has been amended to provide that directors of a company are only obliged to call and arrange to hold a general meeting on the request of members holding at least 5% of the votes that may be cast. Previously, directors of a company were required to hold a general meeting upon the request of 100 or more members entitled to vote which was often an expensive exercise.

2. Changes to reporting requirements for executive remuneration – Section 300A(2) of the Act has been amended to require that only listed disclosing entities to provide remuneration reports. Unlisted disclosing entities no longer need to prepare and provide a remuneration report concerning the remuneration of key management personnel. Further, section 300A(1)(e)(iv) has been amended to relax the remuneration reporting requirements for listed disclosing entities.

3. Determining a company’s financial year – A note has been added to section 323D(2A) of the Act to clarify how a company can shorten its financial year to be less than 12 months on the basis that the reduction is in good faith in the best interests of the company.
4. Exemptions for companies limited by guarantee – sections 327A, 327B, and 327C of the Act have been amended to provide that small companies limited by guarantee are not required to appoint or maintain an auditor if they are entitled to elect whether their accounts are reviewed rather than audited.

For more information about the new amendments, please contact us.