The Minister of Commerce and Consumer Affairs, Andrew Bayly, commented that the Companies Act 1993 “is a foundational piece of legislation for our economy. It sets the rules for the birth, life and death of all our companies, of which there are over 730,000. However, the Act has not been substantially updated in 30 years and, as a result, aspects of it do not reflect the modern business environment and hamper growth and innovation.”
A number of the “phase one” company law reforms and the problems they seek to address are summarised in the table below. They will be implemented through the Corporate Governance Amendment Bill, which is expected to be introduced to Parliament in early 2025. The public will be able to make submissions on that legislation, through Parliament’s website, as it goes through the Select Committee stage.
A “phase two” Law Commission review of directors’ duties and related issues is also planned. Detail around what that review will involve is yet to be released, but more significant changes to company law are expected as a result of that review.
A central beneficial ownership register proposed by the previous Government will not be progressed as the current Government considers that the key policy objectives (e.g. to combat money laundering, terrorism financing and tax evasion) and expected outcomes (e.g. increased compliance costs) of that proposal are not aligned with those of the proposed “phase one” company law reforms (e.g. to reduce the burden of compliance and costs).
