January 22, 2020

Shareholder's rights to inspect Australian company books

Shareholder's rights to inspect Australian company books

Updated: 27 January 2021

A court may make an order to grant a shareholder or another person the right to  inspect the books of an Australian company on their behalf.

Here’s what you need to know.

The court may only make the order if it's satisfied the applicant is acting in good faith and the inspection is for a proper purpose. 

Copies

The person authorised to inspect the books is able to make copies (unless the court orders otherwise). 

The court can also make other orders. 

Other orders 

The court can also make orders limiting the use that a person who inspects may make of information obtained during the inspection or the right to make copies: s. 247B Corporations Act 2001 (Cth).

Also, there are rules when it comes to disclosure.

No disclosure

A person that inspects a company’s books on behalf of a shareholder must not disclose the information obtained during inspection. This is a strict liability offence.

The person that inspects is only able to make disclosures to ASIC or the applicant (shareholder authorising the person inspecting the books). 

Resolution

Also, the directors of a company or the company by a resolution passed at a general meeting, may authorise a shareholder to inspect the books of a company: s. 247D Corporations Act 2001 (Cth).

Do you have questions or comments about shareholder rights to inspect books? Be sure to leave them below. 





About the author 

Vivian Michael

As founder and lawyer at Michael Law Group, CPA and owner of a business consultancy, Vivian is well-positioned to advise Australia's top entrepreneurs. Entrepreneurs benefit from Vivian's commercially focussed legal advice, business experience, and commitment to deliver the best quality business legal services to entrepreneurs, wherever they may live in the globe.

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