Resigning as a director? Don’t get caught out.
A company must notify ASIC of a director’s resignation within 28 days of the resignation date, otherwise a fine will be incurred. Prior to 18 February 2021, even if ASIC was notified after 28 days of the resignation date, ASIC would record the effective date of the resignation as being the date set out in the ASIC notification. This has now changed.
From 18 February 2021, there are new rules regarding the ‘effective dates’ of resigning directors. If the company files its notification of resignation of director after 28 days, the effective date will be the date ASIC is notified. This means that if a company is late in notifying ASIC of the resignation of a director, the resigning director will continue to have director obligations and be liable for the actions of the company until the ‘deemed’ effective date.
If you are resigning as a director, it is therefore imperative that ASIC is notified of your resignation as soon as possible (and at the very least within 28 days of your resignation). Otherwise, you may be liable for matters that are not within your knowledge or control. You therefore should insist on the company providing evidence of the ASIC notification of your resignation within 28 days or you can self - notify ASIC of your resignation.
If you would like us to assist you with this process, please contact Sally Lloyd.