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Proprietary Company

What is a Proprietary Company used for?

A proprietary company is the most popular type of company. It is generally the most appropriate company structure for small businesses.

What’s required?

One director and one shareholder (this can be the same person) – must be over 18 years of age and at least one director must ordinarily reside in Australia
A secretary is not required for a proprietary company, but if one is appointed, they must reside in Australia.
A proprietary company is limited to a maximum of 50 members. Any legal entity may hold shares in a company. This includes any person, company or incorporated association which is resident anywhere in the world.

Why choose Castle Corporate

Electronic
Standard
Premium

Electronic

This package includes PDFs of all of the following:

ASIC’s certificate of registration
All company registration documents, including:
- Company Constitution
- Minutes and consents
- Form 201
Guidelines

$751

Standard

This package includes PDFs of all of the following:

ASIC’s certificate of registration
All company registration documents, including:
- Company Constitution
- Minutes, consents & registers
- Form 201
Guidelines

+ Documents provided in presentation box

+ 1 bound and 1 unbound copy of the deed/constitution

+ A printed copy of all documents

+ Documents tagged with ‘Sign here’ tags

$817

Premium

This package includes PDFs of all of the following:

ASIC’s certificate of registration
All company registration documents, including:
- Company Constitution
- Minutes, consents & registers
- Form 201
Guidelines

+ Quality binder with easy to reference indices

+ 3 bound and 1 unbound constitutions/deeds with the ability to select up to 6 bound copies

+ A printed copy of all documents

+ Documents tagged with ‘Sign here’ tags

$861

Company Name Search

Ensure your company name is available by doing a search of ASIC

Proprietary Company FAQs

Why are common seals no longer included in company packages?
As of 1 July 2014, Castle Corporate no longer offers common seals as a standard inclusion in our company packages. To explain the reasoning behind this change, we thought we would give you a little bit of background to the seal.

The history of the common seal

A common seal was once used as a form of proof by a company that it had formally and legally executed a document.

Until 30 June 1998, the use of a common seal to execute solemn or formal documents was compulsory.

However, as part of the Costello-led corporate law reform process, and as embodied in the Corporate Law Review Act 1998, the use of a common seal by a company was made optional. That Act stated that:

“A company is not required to have a common seal. If it does, the seal must show the company’s name and its ACN. The seal is equivalent to the company’s signature and may be used on important company documents such as mortgages.”

Many organisations took years to adjust to that new relaxation in the law. The worst offenders were government instrumentalities who, in some cases, did not accommodate that change for 8 to 10 years.

Now, some 16 years later, the vast majority of organisations and individuals are familiar with, and comfortable about, accepting a document executed by a company without a common seal.

Benefits of not using a common seal

The ordering of common seals when setting up a company has become less and less popular over the years.

And for good reason. This new approach means:
- lower costs for the company owners
- the ability to receive the company documentation faster
- no-one needs to worry about the location of the seal, and
- no need for ink pads and other inconveniences.
What if I still want to order a seal?

While common seals have become less popular, that does not mean we will stop offering them. Common seals can be ordered for an additional fee, either:
- when ordering a company or a change of company name – simply select it as a package option on our company order form, or
- separately – send us an email to castle@castlecorp.com.au.
Please note that ordering a common seal will slow the delivery of your company paperwork by at least one business day.

If you have any questions about common seals, we would be happy to help. Please call us on 03 9898 6666.

As we know that you may receive questions from clients regarding common seals, we pulled the above information into a useful Information Sheet that you can share with your clients: Common seals no longer part of our packages
What classes of shares do you allow for?
Nine classes of shares are provided for in all standard companies. This anticipates and prepares the company for various changes to the composition of shareholders and other changes which may arise over the life of the company, avoiding the need for (and expense of) creating the most commonly needed classes of shares in future years.

The classes are:
- ordinary shares with all normal dividend and voting entitlements. This is the class of share most commonly used in all types of companies.
- A to F class shares – these all have the same right to receive a dividend at a rate different to that paid on the ordinary shares. These shares allow for dividend streaming. Although the holders of the same class of share must receive the dividends paid at the same rate, a different rate can be paid to the holders of different classes. For example, if there is a holder of A, B and C class shares, the holder(s) of A class shares may receive a dividend of 10 cents per share; those holding B class shares may receive no dividend; and those holding C class shares may receive a dividend of 50 cents per share. Those rates can be altered for each dividend payment. These shares do not confer any entitlement to vote.
- G and H class redeemable preference shares – these generally do not confer an entitlement to vote, but do confer an entitlement to receive dividends in priority to all other shareholders. These shares can be redeemed at the Company’s option.
Other than ordinary shares, no classes are entitled to share in the surplus assets in a winding up of the company.
What is a public officer?
The public officer in a company is the primary contact for the Australian Taxation Office (ATO).

You must advise the details of the public officer to the ATO within three months of commencing trade.

This can be done when applying for your Australian Business Number (ABN).
Do I have to have a secretary?
Not for a proprietary company. Since 2000, the office of secretary has been optional for Australian proprietary companies. Even so, ASIC requires to be notified of an appointment or resignation of a company secretary. We can assist you. Simply fill in this form and email it back to us.

However, public companies are still required to have one secretary who must reside in Australia.
What do company directors do? Can I just appoint a spouse or a friend as a director?
Directors are responsible for the proper and prudent operation of the company and are the primary decision-makers.

Unless they will be actively involved with the business, it is usually not a good idea to appoint your spouse or friend as a second director of a company.

It is important to note that when it comes to statutory duties and obligations, ignorance is not accepted as an excuse for non-compliance.

If you wish to make any changes to the directors of a company, we can help. Simply fill in this order form and email it back to us.
Why does a director have to be resident of Australia?
It is a requirement under Section 201A of the Corporations Act (2001) that all Australian proprietary companies must have at least one director who resides in Australia. Because of this rule, ASIC will not allow a company to either be registered or owned by only foreign residents.

You can view where the Corporations Act references this requirement here.
Can I form a company with one director?
Yes – for a proprietary company. Since December 1995, Australian proprietary companies have been allowed to register with a sole director (who must live in Australia).

Public companies must have a minimum of three directors (two of whom must reside in Australia).
Do you provide a common seal? Do I need one?
Australian companies are not required to have or use a common seal. The requirement was removed in 1998.

Many people continue to order common seals, but their popularity has declined over the last 10 years or so.

However, if you would like a common seal, they come included in our Premium and Standard packages. If you do not want one, $16.50 will be deducted from your package fee.

For our Electronic packages, you can choose to add one to your order for an additional $27.50.
What are the replaceable rules?
The replaceable rules are a collection of about 40 sections extracted from the Corporations Act 2001 that give a general framework for running an Australian company.

These rules govern the internal relationships of officers and shareholders, but do not cover more practical rules relating to how a company is run on a day-to-day level.

To read more about constitutions and the replaceable rules and to determine the suitability of both for your company, please read this page on the ASIC website: Constitution and replaceable rules.
Do you provide a constitution?
The constitution contains the rules and procedures that determine how the company is run, making it a very important document.

All companies produced by Castle Corporate are provided with our up-to-date constitution in PDF format. If you choose our standard package, two bound copies of the constitution are included. Our premium package includes four bound copies.

What are the replaceable rules?

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