Legal
How Corporate Penalties Work
When a corporation or entity, violates the Corporations Act, the law often specifies a maximum number of penalty units. However, for serious civil penalty provisions, the maximum penalty is determined by taking the greatest of the following three amounts:
1. The maximum penalty units prescribed for the offence multiplied by $330.
2. Three times the benefit obtained (and detriment avoided) because of the contravention.
3. 10% of the body corporate's annual turnover for the 12-month period ending in the month the contravention occurred (subject to a statutory cap).
Under the The Treasury Laws Amendment (Strengthening Corporate and Financial Sector Penalties) Act 2019, the maximum civil penalty for individuals is the greater of 5,000 penalty units (currently $1.65 million) or three times the benefit obtained and detriment avoided.
Under the The Treasury Laws Amendment (Strengthening Corporate and Financial Sector Penalties) Act 2019, the maximum civil penalty for companies is the greater of:
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50,000 penalty units (currently $16.5 million)
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three times the benefit obtained and detriment avoided, or
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10% of annual turnover, capped at 2.5 million penalty units (currently $825 million).
More information on Australian business requirements and responsibilities in protecting their intellectual property is available via:
Treasury Laws Amendment Act 2019
Requirements for Registering a Business Name
Business Names Registration Act 2011
