Replaceable rules are in the Corporations Act and are a basic set of rules for managing your company.
If a company doesn't want to have a Constitution, replaceable rules will apply by default instead.
It is also possible for a company to be governed by a combination of a Constitution supplemented by the replaceable rules.
They can be an easy way for proprietary companies to manage their corporate governance.
The below FAQ assume that a company does not have a Constitution, and the replaceable rules apply by default.
Replaceable rules do not apply to a proprietary company if the same person is the sole Director and the sole Shareholder, or if the proprietary company adopts a Constitution to vary, displace or replace the Replaceable Rules.
The Replaceable Rule provisions can change, so you should always refer to a current copy of the Corporations Act at legislation.gov.
Yes, a Director can vote on matters related to their interest if they disclose the nature and extent of the interest and its relation to the affairs of the company at a meeting of the Directors, or if the interest does not need to be disclosed under section 191 of the Corporations Act.
A company may appoint a person as a Director by resolution passed in a general meeting.
The Directors of a company may also appoint a person as a Director.
Yes, the Directors of a company may appoint one or more of themselves to the office of Managing Director for the period and on the terms they see fit.
The Directors of a company are to be paid the remuneration that the company determines by resolution.
The company may also pay the Directors' travelling and other expenses incurred in attending meetings and in conjunction with the company's business.
A Director of a company may resign by giving a written notice of resignation to the company at its registered office.
A Director may call a meeting of the company's Members (a.k.a. Shareholders).
The Directors may elect an individual to chair meetings of the company's Members.
Subject to any rights or restrictions attached to any class of shares, at a meeting of Members of a company with a Share Capital, each Member has one vote on a show of hands and one vote for each share they hold on a poll.
A person transferring shares remains the holder of the shares until the transfer is registered and the name of the person to whom they are being transferred is entered in the Register of Members in respect of the shares.
The Directors of a proprietary company may refuse to register a transfer of shares in the company for any reason.
Further reading: ASIC Guide on Replaceable Rules
This FAQ is intended for general interest + information only.
It is not legal advice, nor should it be relied upon or used as such.
We recommend you always consult a lawyer for legal advice specifically tailored to your needs & circumstances.