When a company director is prohibited by the Registrar of Companies under section 385 (3) of the Companies Act 1993 from taking part in any matter relating to the directing or management of any company for four years , the Registrar must take action when such a director publicly disregards this prohibition and brazenly flouts the law. Such a director “commits an offence and is liable on conviction to the penalties set out in section 373(4) of this Act…. A person convicted of an offence for failure to comply with the Act… is liable to imprisonment for a term not exceeding 5 years or to a fine not exceeding $200,000.” [Read more…]
The Deputy Registrar of Companies, Peter Barker, issued a media release on 19 May 2010 (InfoNews) noting:
The Registrar of Companies has the power under section 385 of the Companies Act 1993 to prohibit persons from being a director, or involved in the management of companies. The power can apply to any person who has been a director, or involved in the management of, a failed company or companies within the previous 5 years. Where a person has been identified as a candidate for prohibition on the basis of multiple failed companies the onus is on that person to satisfy the Registrar that their management of the affairs of those companies was not at least partly responsible for their demise, or that prohibition would not be just or equitable .
Prohibition: The maximum term of prohibition under Section 385(3) of the Companies Act 1993 is five years. The prohibition prevents those concerned from acting as directors or promoters of a company, or being concerned in, or taking part, whether directly or indirectly, in the management of a company.
Penalty: Failure to comply with the notice of prohibition is an offence and persons are liable upon conviction to a penalty of up to 5 years imprisonment or a fine not exceeding $200,000.