Section 187 — Corporations Act 2001 (Cth)

Directors of wholly‑owned subsidiaries

A director of a corporation that is a wholly‑owned subsidiary of a body corporate is taken to act in good faith in the best interests of the subsidiary if:

(a) the constitution of the subsidiary expressly authorises the director to act in the best interests of the holding company; and

(b) the director acts in good faith in the best interests of the holding company; and

(c) the subsidiary is not insolvent at the time the director acts and does not become insolvent because of the director’s act.

Sourced from the Federal Register of Legislation at 17 May 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au. Verify the current text against the official source before relying on it.

Related sections

s 184 — Good faith, use of position and use of information—criminal offences
s 185 — Interaction of sections 180 to 184 with other laws etc.
s 186 — Territorial application of sections 180 to 184
s 188 — Responsibility of secretaries etc. for certain corporate contraventions
s 189 — Reliance on information or advice provided by others
s 190 — Responsibility for actions of delegate

Research how courts apply s 187

BriefBridge searches Australian caselaw by meaning — every answer cited to the paragraph.

Try BriefBridge free