A company’s members are its owners. All companies must have at least one member. You don’t have to reach a minimum age before you can become the member of a company under Australia’s Corporations Act 2001, however, some companies may set a minimum age in their own constitution.
A private or proprietary company is not permitted, under Australian corporations law, to have more than 50 members that are not employees of the company. No limit is placed on the number of members for a public company, which is listed on the stock exchange.
To become a company member, you must be “an entity that can own property, sue or be sued.” In other words, certain ‘entities’ can and cannot be members of a company according to the Corporations Act 2001. For example, if you are one of the following you can become a company member:
- An individual person (Jo Blogs)
- A body corporate (Blogs Pty Ltd)
- A body politic (NSW Government)
On the other hand, the following do not qualify to be a company member:
- A business name
- An estate
- A trust
In order to be a member of a company, an estate or a trust need to nominate an executor or a trustee to hold shares in a company on their behalf.
A company has its own legal existence and owns its own assets, even though it is owned by its members. The company’s assets do not belong directly to its members and those members can’t usually be held personally liable for the company’s debts or liabilities. If called upon to do so, the only financial obligation of a member is to pay the company any unpaid amount owed on his or her shares.
Meetings of members can be held at which members can vote on resolutions and make decisions about how the affairs of the company are conducted. Specific rules are set out in Australian corporations law about how members’ meetings must be conducted.
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