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By: Ryan Solomons, Esq. & Mark Madsen, Esq.
Mullins Lawyers
Brisbane, Australia

It has now been announced that the licensing phase of the QBCC amendments will come into force as of 1 July 2015, the major change being the repeal of the “permitted individual” regime.

For those in the building and construction industry, it is essential to have a working understanding of these changes and the effect they could have on your business, some of which we set out below.

Reduction of exclusion period

Under the existing system, the QBCC will cancel a building licence of an individual where a construction company is wound up, or the individual concerned goes bankrupt (whilst that person is a director or within one year after they ceased being a director). Currently, the cancellation applies for five years.

To soften the impact of the changes about to come into force, the relevant exclusion period will be reduced from five years to three years.

The penalty for multiple defaults will remain unchanged in the form of a life ban.

Construction company

Key provisions of the licensing regime, including whether in fact a licence is required, depend on whether or not the licensee is directly or indirectly carrying out building work or building works services. If a category of licence is available for the performance of the work, and the above insolvency situations apply, individuals may be subject to cancellation of their licence.

The legislation has been tidied up.  Licensees will only fall foul of the regime where they are a director of an insolvent company if that company is a “construction company” as defined under the Act. This will prevent people becoming excluded individuals where they are also directors of companies that may have become insolvent but have nothing to do with the construction industry; for example, a company carrying on a coffee shop business.

Permitted individual applications

Previously, affected licensees were able to make an application to have their licence reinstated where the insolvency event was out of their control and they had done everything to prevent the default. This was referred to as a “permitted individual” application.

This application will no longer be available. It has been replaced with the ability to make limited submissions to the QBCC on whether or not a licensee was in fact the subject of an insolvency event and, therefore, should be considered an excluded individual for that particular insolvency event.

The submissions must be made within a 28 day reply period after notice from the QBCC.  Any decision by the QBCC is a decision which can still be reviewed by QCAT.

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