The Queensland Building Services Authority Act 1991 (the QBSA)is no more. The new version of the Act, which came into force on 1 December 2013, is now called the Queensland Building and Construction Commission Act 1991 (the QBCC).

What you need to know

  • There is a new management structure. The QBCC replaces the Authority with a commission structure consisting of a board (the Queensland Building and Construction Board) and a commissioner overseeing new business units.
  • It is now clearer that parties to a contract are not required to be licensed merely because they have entered into a contract to carry out building work, so long as the building work involved is carried out by an appropriately licensed contractor.
  • However, if you are unlicensed and enter into a contract to carry out building work, you will need to be able to demonstrate that:
    • you have not “caused or allowed” unlicensed building work to be carried out on your project; and
    • the work is not residential construction or domestic building work.
  • There are new exemptions to the general requirement to be licensed in relation to tenders and offers, public private partnerships and prescribed government projects. The exemption for tenders and offers will have the widest application to the industry, but industry proponents seeking to rely on this exemption should ensure that they have complied with its requirements. There is some further discussion on the new exemptions in the section below.
  • Further, and more wide-ranging, changes to the regulation of the industry are likely to be introduced in 2014.

Exemptions to the requirements to be licensed

Due to the progressive expansion of licence classes and the definition of building work, on a strict interpretation of the old requirements in the QBSA, developers and principals who entered into head contracts for building work could be required to be licensed. However, few were.

The amendments to section 42 and the new Schedule 1A in the QBCC are intended to clarify who is required to be licensed, and who is exempt. Schedule 1A sets out all of the current classes of person who are exempt from the requirement to be licensed to carry out building work.

The head contract exemption

The amendments to the QBCC clarify that parties to contracts that agree to carry out building work (such as head contracts or development agreements) are not required to be licensed if the building work is carried out by an appropriately licensed contractor.

This exemption to the general requirement to be licensed will not apply if an unlicensed person enters into a contract for residential construction work or domestic building work.

In addition, the exemption will “cease to apply to the unlicensed person if the person causes or allows any of the building work to be carried out by a person who is not licensed to carry out building work of the relevant class (section 8(3) of Schedule 1A).

Exactly what the underlined words mean is not clear. Unlicensed parties to contracts involving building work should take all necessary steps to demonstrate that they have checked that all contractors and subcontractors are properly licensed throughout the duration of the project.

The tenders and offers exemption

An unlicensed person can submit a tender to carry out, or offer to carry out, building work provided that:

  • the work will be carried out by an appropriately licensed contractor
  • the work being tendered for is not for residential construction or domestic building work.

Public Private Partnerships (PPPs) and prescribed government projects

Special purpose vehicles that are established to carry out a PPP and  undertake to carry out building work are not required to be licensed if the building work is carried out by an appropriately licensed contractor. There is a similar exception for an unlicensed person who undertakes to carry out building work for projects prescribed under a State Government regulation.