From 1 January 2012, companies seeking a new listing
will be required to provide the ASX with criminal and bankruptcy
checks to satisfy the ASX's proposed "good fame and
This will apply to foreign directors and directors who
have worked overseas; they will be required to obtain the overseas
equivalent of these checks.
The ASX believes there is an ongoing obligation on
Boards of listed companies to carry out these searches for all new
In a recent article, we explained that amendments to the
Listing Rules will require companies seeking a new listing to
obtain relevant criminal and bankruptcy checks to satisfy ASX's
new "good fame and character" requirement.
IMPLICATIONS FOR FOREIGN DIRECTORS AND DIRECTORS WHO HAVE
The Rule will require foreign directors and directors who have
worked overseas to obtain the overseas equivalent of a criminal
history check and ITSA bankruptcy check to satisfy the "good
fame and character" requirement.
While the new Rule will not apply to directors appointed
following admission, ASX is of the view that prior to appointing a
new director, existing directors will need to satisfy themselves
that the new director is of good fame and character. To do this,
the board of listed companies will need to carry out the equivalent
COSTS OF COMPLYING WITH THE "GOOD FAME AND CHARACTER"
In Australia, the time that it will take to obtain the relevant
criminal history and bankruptcy checks will typically be between
fifteen to thirty days for a criminal history check and
instantaneous for an Insolvency and Trustee Service Australia
(ITSA) bankruptcy check using online sources.
The processing time for obtaining a foreign criminal history or
bankruptcy check from a particular country will depend on various
factors including whether there is a centralised database for the
information, the need for translation, time differences,
availability of the information that must be provided to the
relevant authority and whether the information is being requested
locally or outside of the relevant country.
The following table gives an indication of the expected
processing times in various jurisdictions in which foreign
directors of Australian companies commonly
Checks are available.
No publicly available information on the expected processing
times in the various provinces, district and cities.
Currently 1 to 30 working days depending on the EU country.
From April 2012 a uniform register called the "European
Criminal Records Information System" will be available.
2 working days (individual) or 3 working days (company).
5 -10 working days.
2 or 10 working days depending on payment type.
Up to 12 weeks.
1 to 2 working days.
The above times are indicative only. While the processing time
in several jurisdictions is relatively short and in some cases
instantaneous, companies should obtain the checks well in advance
to allow for any potential delays arising from the factors
In countries in which there is no bankruptcy register (eg
China), the ASX (and the Board) will be in a position to rely on a
declaration from the director to that effect.
The ASX has released proposed revised versions of Guidance Note
1 Applying for Admission – ASX Listings and Guidance Note 4
Foreign Entities listing on ASX. These revised Guidance Notes have
recently undergone public consultation and are expected to be
officially released shortly.
1The information in the table is based on
publicly available information.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
Most awarded firm and Australian deal of
Australasian Legal Business Awards
Employer of Choice for
Equal Opportunity for Women
in the Workplace (EOWA)
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
We discuss whether certain clauses commonly found in ordinary commercial contracts could be considered to be penalties.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).