Selling a ready-made company, and where AML/CTF touches it
A shelf company is one that was registered in advance and kept until somebody wants it. Selling one is a designated service — and a different one from registering a new company to order.
Start here
What a shelf company is
A shelf company is a company that was registered with no business to do, and then left on the shelf. It has a name, an ACN, a constitution and an incorporation date. It has never traded.
Formation agents keep a stock of them. When a client needs a company today rather than next week, one comes off the shelf: the shares transfer, the directors change, and the client walks out with a company that already exists.
Selling or transferring one of those is item 5.
Why anyone buys one
| The reason | What it means |
|---|---|
| Speed | The company exists today; registering a new one takes time and paperwork |
| An older incorporation date | Some contracts, tenders and lenders prefer a company that is not brand new |
| Convenience | A formation agent has done the constitution, the ACN and the ASIC lodgement already |
| Appearance | The uncomfortable one: an older date can make a new venture look established |
The last row is why the service is in the Act. A company incorporated three years ago looks like an established business to anybody who glances at the record, and it was bought last Tuesday. That gap between how old a company looks and how long its owner has been involved is the thing a regulator is interested in.
The shape of it
Four things worth fixing in your head
The person taking the company — not whoever held it on the shelf
Registering a new company on instructions is item 6 instead
An incorporation date that predates the buyer’s involvement
Shelf company sales became a designated service under Table 6, item 5
The part people get backwards
Selling one is item 5. Making one is item 6.
These two get mixed up constantly, and the difference matters because the customer definitions are not the same.
If the company already exists and you are handing it over, that is item 5, and your customer is the buyer. One person to check.
If a client asks you to register a company for them, that is item 6, and your customers are the client plus every beneficial owner and every director of the new company. Often several people to check.
| Item 5 — shelf company | Item 6 — new company | |
|---|---|---|
| What you do | Sell a company that already exists | Bring a new company into existence |
| Which item | Item 5 | Item 6 |
| Who your customer is | The buyer or transferee | The person, plus the beneficial owners and directors |
| How many people to check | One | Often several |
| Typical trigger | A client wants a company today | A client wants a company built for their purpose |
A formation agent that does both provides two designated services, and the program has to deal with each.
Are you providing it?
Handing over a company that already exists
| The work | Which item? |
|---|---|
| Selling a pre-registered company from your inventory to a client | Caught — item 5 |
| Transferring the shares and directorship of a shelf company to a buyer | Caught — item 5 |
| Registering a brand-new company on a client’s instructions | Not item 5 — that is item 6 |
| Providing company secretarial services to a company you are not selling | Not caught by item 5 |
What actually gets checked
Six checks on one buyer
The purpose question does real work here. “I need it today” and “the tender closes Friday” are ordinary answers. An unexplained preference for a company with an older incorporation date is worth a note.
| The check | What is required | How it is usually done | What stays in the file |
|---|---|---|---|
| Identify the buyer | Full name, date of birth and residential address of the person taking the company | Licence or passport, in person or by digital check | What was collected and how it was verified |
| Find out who will own it | Who will own or control 25% or more once the transfer completes | The share transfer you are about to execute | Who they are and how you worked it out |
| Screen for PEPs and sanctions | Whether the buyer is politically exposed, and a check against the DFAT Consolidated List | A screening tool, or a manual DFAT search | The result and its date |
| Understand the purpose | What the company is for, and why an existing one rather than a new one | Ask. Speed is a fine answer; so is a tender deadline | The explanation, recorded |
| Rate the risk | Assess and record the ML/TF risk of the buyer | Your program’s risk factors applied to the buyer and the intended use | The rating and the reasons |
| Keep watching | Monitor for as long as the relationship lasts | Often short — but if you also hold the registered office or a directorship, it continues | What you reviewed, when, and what you concluded |
Records are kept for 7 years. If you also supply the registered office or a directorship afterwards, those are separate continuing services with their own obligations.
The provision itself
Table 6, item 5, in the Act’s own words
“selling or transferring a shelf company, in the course of carrying on a business”
Customer: the buyer or transferee. Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth), s 6(5B) table 6, item 5 — Compilation No. 62 (C2026C00274).
It is the shortest item in Table 6 — eleven words of substance. The work is done by the phrase “shelf company”, which is what separates it from item 6.
The thirteen designated services
One article for each service you can select when you enrol
13 of 13 written so far. The rest are in progress.
- ConveyancingEvery step of a settlement, and how CDD differs from the VOI you already do.Table 6, item 1
- Selling a businessWhen a company or trust changes hands.Table 6, item 2
- Client moneyHolding or controlling someone else’s money or property in a transaction.Table 6, item 3
- Equity and debt financingRaising money for a company or legal arrangement.Table 6, item 4
- Shelf companiesyou are hereSelling or transferring a company created to be sold.Table 6, item 5
- Company and trust formationCreating or restructuring a company, trust or partnership.Table 6, item 6
- Director and trustee rolesActing as, or finding someone to act as, a director, trustee or attorney.Table 6, item 7
- Nominee shareholdersHolding shares in your name for somebody else.Table 6, item 8
- Registered officeLetting a client use your address as their registered office.Table 6, item 9
- Real estate agentsThe agent’s customer is both sides of the deal — and the two sides start at different moments.Table 5, item 1
- Property developersSelling your own stock with no agent in between, and why that changes who the customer is.Table 5, item 2
- BullionGold, silver, platinum and palladium, and the $5,000 exemption.Table 2, item 1
- Jewellers and dealersWhy the $10,000 line is about how the customer pays, not what they buy.Table 2, item 2
Sources
Where every figure here comes from
Data as at 27 September 2026.
- Anti-Money Laundering and Counter-Terrorism Financing Act 2006, s 6(5B) table 6 · Federal Register of Legislation · Compilation No. 62 (C2026C00274)Item 5 and its customer definition, quoted verbatim on this page.
- Professional designated services · AUSTRAC · Guidance, current at Sep 2026The worked examples, including that registering a new company is item 6 rather than item 5.
- Register a company · ASIC · Current guidanceWhat registering a company involves, for comparison with buying one ready-made.
- FATF Recommendations 24 and 25 — transparency of legal persons · Financial Action Task Force · CurrentWhy ready-made companies are an international concern.
Before you rely on this
This content is general information only. It is not legal, financial or compliance advice. Organisations should check AUSTRAC guidance, legislation, their own AML/CTF Program and professional advice where needed.
- Whether a company is a shelf company, and whether a particular sale is a designated service, depends on the facts of the case.
- Selling a shelf company is entirely lawful. Nothing here suggests otherwise — the obligation is to know who you sold it to and why.
- Current as at 27 September 2026.
Lex-AML supports compliance workflows and record keeping. It does not provide legal advice, does not guarantee compliance, and does not replace professional judgement or advice from a qualified AML/CTF adviser or legal professional.
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