Factors of Company Law You Need to Know as a Foreign Investor

Ensuring Corporate Documents' Enforceability - What to Know


If you’re planning to invest your savings into opening a business in Australia, you must know that it entails a meticulous process. You have to be sure of what you’re signing up for, so you know where your hard-earned money will go, and you can reap the rewards down the line.

Australian corporate law offers plenty of benefits for potential investors. Before you get started, you have to be familiar with the elements of the law to guarantee it’s the path you want to pursue as a foreign investor interested in bigger and better opportunities abroad.

Keep reading below to acquire brief knowledge regarding corporate law in Australia to give you a better time deciding that investing in the country is the right move for you.

Understanding the Regulatory Scheme

Under the Corporations Act 2001, the law has the authority to regulate companies and their incorporation, securities, the derivatives industry, and the investment of shares. The Corporations Act works with other legal parts of the government legislation to create a steady regulatory plan for companies established within Australia’s states and territories.    

Knowing the Australian Securities and Investments Commission

The Australian Securities and Investments Commission (ASIC) is a state representative that oversees the Corporations Act 2001. ASIC has a wide range of abilities and duties and serves as the regulator and enforcer. The civil organisation is the primary registry and source of information for all kinds of company matters, including that of foreign investors. 

Under the ASIC Act, they hold investigative capabilities to stop wrongdoings by conducting searches to acquire proof and initiate criminal proceedings. They strive to prevent unlawful conduct and supervise government proceedings to eliminate offences under the Corporations Act.

Being Familiar with Incorporation

When starting a company, you as the owner have the right to acquire an individual legal identity apart from your business partners, shareholders, and directors. You also have the power to own properties, enter into legally binding contracts, and hold civil procedures under your name. In Australia, incorporation, also called registration, is the most common kind of business organization. 

After deciding to invest in an Australian-based company, it will be incorporated under the Corporations Act and will include nominating directors, appointing a registered office, and providing shares. In some cases, you may also need to submit copies of your firm’s constitution to the ASIC. 

Determining the Two Types of Companies

1. Public Company

Owning a public company entails having the power to put up your shares for sale or subscription to anyone interested in the public with restricting the transfer of shares. Before you can label your company public, you will need at least three directors to manage it, two of them being a resident of Australia, and at least one shareholder.

2. Proprietary Company

On the other hand, a proprietary company can impose limitations on the sale of the shares. It is the most commonly preferred form of company in Australia and consists of a small group of shareholders that should not go past fifty non-employee shareholders. There needs to be at least one director or shareholder, with one of the directors being a resident of Australia.


With every new venture you plan to take, you must always learn what you’re getting into to avoid facing obstacles further down the line. If you’re committed to starting a company in Australia, it will be best to take the time and learn about the regulatory scheme, the ASIC, incorporation, and the types of companies. You may also want to hire a business lawyer to work with you throughout the entire process and ensure everything goes according to plan. 

Are you looking for the best law firm in Queensland for legal assistance? GLG Legal is a commercial and property law practice that offers real-world solutions to meet your needs. Get in touch with us today to receive the right solution for you.

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