As part of the Queensland Government's building industry fairness reforms, new laws that strengthen the minimum financial requirements (MFR) for licensing commenced on 1 January 2019.
The Building Industry Fairness (Security of Payment) Act 2017 (BIF Act) allows for the MFR to be prescribed in a regulation, which is a step towards making the provisions more transparent.
In 2014, the reporting requirements for licensees were reduced. However, since then, numerous high-profile insolvencies have demonstrated that the Queensland Building and Construction Commission (QBCC) must be able to:
In September 2018, the QBCC released a discussion paper (PDF, 664KB) seeking feedback from industry and the community on the proposed new financial reporting laws.
These laws will benefit industry and the community by:
As a result of this consultation, changes to the requirements are happening in 2 phases:
Phase 1 began on 1 January 2019 through the new Queensland Building and Construction Commission (Minimum Financial Requirements) Regulation 2018 and:
Phase 2 will begin on 1 April 2019 and will introduce higher reporting standards for category 4–7 licensees (larger, higher risk licensees), along with the rest of the reforms.
This phase will also involve repealing the existing MFR Board Policy and placing its provisions in a regulation.
Key changes in the Minimum Financial Requirements Framework (PDF, 173KB) include:
Licensees will need to:
Additionally, the upper revenue limit for self-certifying licensees will increase from $600,000 to $800,000.
The enforcement framework is also being improved, including new penalties and offences for failing to comply with the requirements, such as failing to provide financial information annually. The new regulation outlines these penalties.
Existing penalties continue to apply. Under the BIF Act, the QBCC can place conditions on a licence, or take steps to suspend or cancel the licence.
Penalties also apply for providing false or misleading information, or refusing to supply financial information at the QBCC's request.
The enforcement provisions will be further strengthened as part of Phase 2, including executive officer liability and escalating penalties, to help motivate all parties involved in running a licensed company to meet the new MFR.
Read more information about financial requirements for licensees on the QBCC website .
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