Corporations Act. Australia
as a replaceable rule to any proprietary company that is or was registered before 1 July 1998 that repeals or repealed its constitution after that day; and
(iv) as an ordinary provision of this Act to any public company whenever registered.
The section or subsection does not apply to a proprietary company while the same person is both its sole director and sole shareholder.
Note 1: See sections 198E, 201F and 202C for the special provisions that apply to a proprietary company while the same person is both its sole director and sole shareholder.
Note 2: A company may include in its constitution (by reference or otherwise) a replaceable rule that does not otherwise apply to it.
Company’s constitution can displace or modify replaceable rules
(2) A provision of a section or subsection that applies to a company as a replaceable rule can be displaced or modified by the company’s constitution.
Failure to comply with replaceable rules
(3) A failure to comply with the replaceable rules as they apply to a company is not of itself a contravention of this Act (so the provisions about criminal liability, civil liability and injunctions do not apply).
Note: Replaceable rules that apply to a company have effect as a contract (see section 140).
136 Constitution of a company
(1) A company adopts a constitution:
(a) on registration — if each person specified in the application for the company’s registration as a person who consents to become a member agrees in writing to the terms of a constitution before the application is lodged; or
(b) after registration — if the company passes a special resolution adopting a constitution or a court order is made under section 233 that requires the company to adopt the constitution.
Note: The Life Insurance Act 1995 has rules about how benefit fund rules become part of a company’s constitution and about amending those rules. They override this Act (see section 1348 of this Act). Consequential amendments to the rest of the company’s constitution can be made under that Act or this Act (see Subdivision 2 of Division 4 of Part 2A of that Act).
(2) The company may modify or repeal its constitution, or a provision of its constitution, by special resolution.
Note: The company may need leave of the Court to modify or repeal its constitution if it was adopted as the result of a Court order (see subsection 233(3)).
(3) The company’s constitution may provide that the special resolution does not have any effect unless a further requirement specified in the constitution relating to that modification or repeal has been complied with.
(4) Unless the constitution provides otherwise, the company may modify or repeal a further requirement described in subsection (3) only if the further requirement is itself complied with.
(5) A public company must lodge with ASIC a copy of a special resolution adopting, modifying or repealing its constitution within 14 days after it is passed. The company must also lodge with ASIC within that period:
(a) if the company adopts a constitution — a copy of that constitution; or
(b) if the company modifies its constitution — a copy of that modification.
This also applies to a proprietary company that has applied under Part 2B.7 to change to a public company, while its application has not yet been determined.
(6) An offence based on subsection (5) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
137 Date of effect of adoption, modification or repeal of constitution
If a new constitution is adopted or an existing constitution is modified or repealed, that adoption, modification or repeal takes effect:
(a) if it is the result of a special resolution:
(i) on the date on which the resolution is passed if it specified no later date; or
(ii) on a date specified in, or determined in accordance with, the resolution if the relevant date is later than the date on which the resolution is passed; or
(b) if it is the result of a Court order made under section 233:
(i) on the date on which the order is made if it specifies no later date; or
(ii) on a date specified by the order.
138 ASIC may direct company to lodge consolidated constitution
ASIC may direct a company to lodge a consolidated copy of its constitution with ASIC.
139 Company must send copy of constitution to member
(1) A company must send a copy of its constitution to a member of the company within 7 days if the member:
(a) asks the company, in writing, for the copy; and
(b) pays any fee (up to the prescribed amount) required by the company.
(2) An offence based on subsection (1) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
140 Effect of constitution and replaceable rules
(1) A company’s constitution (if any) and any replaceable rules that apply to the company have effect as a contract:
(a) between the company and each member; and
(b) between the company and each director and company secretary; and
(c) between a member and each other member;
under which each person agrees to observe and perform the constitution and rules so far as they apply to that person.
(2) Unless a member of a company agrees in writing to be bound, they are not bound by a modification of the constitution made after the date on which they became a member so far as the modification:
(a) requires the member to take up additional shares; or
(b) increases the member’s liability to contribute to the share capital of, or otherwise to pay money to, the company; or
(c) imposes or increases restrictions on the right to transfer the shares already held by the member, unless the modification is made:
(i) in connection with the company’s change from a public company to a proprietary company under Part 2B.7; or
(ii) to insert proportional takeover approval provisions into the company’s constitution.
141 Table of replaceable rules
The following table sets out the provisions of this Act that apply as replaceable rules.
Provisions that apply as replaceable rules
Officers and Employees
1
Voting and completion of transactions — directors of proprietary companies
194
2
Powers of directors
198A
3
Negotiable instruments
198B
4
Managing director
198C