Steps to register and incorporate a company in Australia

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Contents
ANSWER 1.................................................................................................................................................2
Issue........................................................................................................................................................2
Relevant law............................................................................................................................................2
Application of law...................................................................................................................................3
Conclusion...............................................................................................................................................4
Answer 2.....................................................................................................................................................4
Issue........................................................................................................................................................4
Applicable Law.......................................................................................................................................4
Application of law...................................................................................................................................5
Conclusion...............................................................................................................................................6
Reference list...............................................................................................................................................7

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ANSWER 1
Issue
Advice to Richard and his sons regarding steps to register and incorporate a company.
Relevant law
There are various forms of business structure such as a company, proprietorship, partnership etc.
Out of which the best process to carry on the business is by way of establishing a company. A
company in order to be in existence requires a certain procedure to be followed then only a
company can be floated , the procedure for registration of a company is stated in the Corporation
Act 2011, moreover it should be as per guidelines of ASIC. The procedure of registration of
company is as follows: (Nolan 1996)
i. A company can be of two types a private and a public company. A private company
can further be bifurcated into a limited liability company where the liability of
members is limited, a unlimited liability company in which the liability is not limited
and the company limited by guarantee in which the liability of persons is as per the
guarantee. A person deserting to form a company can choose from any of the above.
ii. After finding out which type of company is to be formed the next stage is to give a
name to a company, the name of the company can be chosen by the persons
incorporating it but it cannot contain words like incorporated bank, trust and royal
etc. Further the use of name requires approval from the government. Also the
derogatory words or offensive words which are misleading in nature cannot also be
opted as a name of the company. Also a name of already existing or similar to an
existing company can also be not the name of a new company. (Gibson and Fraser
2013)
iii. Now after the name of the company is finalized then the constitution and the
framework of the company is decided. One way is that a company may adopt the
replaceable rules as stated in the Corporation Act 2001 as per Part 2B, chapter 2B.4
of the corporation act 2001or a company can formulate its own constitution and apart
from above two structures for a company, there can also be adoption of both the
replaceable rules and the constitution. After all this it is thus decided that the
company will have a limited liability or unlimited in case of limited company whether
it should be limited by guarantee or limited to the extent of shares.
iv. A private company in Australia should have one secretary, director and member and
all must be of sound age and mind. Every person being member of the company
should provide their assent that they must abide by the rules and the obligations of the
company as per the constitution of the company.
v. A company should have its registered place of carrying on the business. In case the
place of business does not belong to company then approval of the owner is to be
taken and in case the place belongs to the company by then no formality is required.

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vi. Requisite fees along with form 201 is to be deposited with ASIC. When the company
is registered then the certificate of incorporation is issued in favor of the company,
corporate key and a can number is also provided to a company.
vii. ACN number is mandatory to be mentioned on the company’s documents. And a
company should keep all its documents up to date.
When the above said process is complied with by the company then the company comes into
existence. As and when the company is formed the company acquires the feature of a separate
legal entity i.e. a company is regarded as separate from its directors and management and the acts
of the company performed by the directors etc. on behalf of a company are considered to be
company’s own acts, as it can acquire its own property in its name and can enter into contracts
with third party in its own name. The case law of Salomon v A Salomon and Co Ltd [1897] also
states that the company is different from the persons who run the company. (Seal and Penrith
2008)
Also a company makes its members liable to the extent of number of shares the member hold on
behalf of a company. A company has feature of perpetual succession as company runs even if
person retires or sells his stake in company. Further the tax benefits are associated with a
company and it is easy to raise capital in case of a company. (Gibson and Fraser 2013).
Application of law
Richard is having an extensive olive grove having 12,000 trees in NSW. He purchased a
neighboring property with a view to expand his business. David and Liam had also moved to him
from Sydney and with a view to expand business and capital requirement and tax benefits seek
advice to adopt company form of business.
As company form of business will be beneficial for them as per the features of the company the
requirements of Richard, David and Liam are fulfilled so hence they must adopt for company
form of business and thus abide by the Corporation Act 2001 and ASIC rules in order to get their
company registered.
Now, there are few name suggestions that are provided.
“Rich’s Guaranteed Olives” the name as suggested by David and Liam may not work out as it
suggest that the company is guarantying the rich quality of olives and such name which are
deceptive cannot be allowed as per the Act of Australia so hence this name cannot be kept by
them with respect to the company.
On the other hand Ridali the name as suggested by Richard will work as it not misleading in any
way or deceptive in nature hence this will work so company can keep this name.