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Changes to QBCC Licensing Requirements: Head Contractor Licensing Exemption Gone

16th November 2020

Contractors are no longer exempt from the requirement to hold a building license even where they are subcontracting building work to a licensed subcontractor.

In addition to significant reforms to the security of payment provisions (you can see our previous article on the security of payment reforms here) the Building Industry Fairness and Other Legislation Amendment Act 2020 which was passed on 23 July 2020 removes the previous exemption under the Queensland Building and Construction Commission Act 1991 (Qld) (“the QBCC Act”) which allowed unlicensed head contractors to avoid committing an offence under the QBCC Act, by carrying out unlicensed building work, provided they subcontracted the building work to a licensed party.

This means that a contractor who carries out or even undertakes to carry out (for example, by signing a contract) building work, for which they do not hold a license of an appropriate class, will now commit an offence under the QBCC Act. This is so even if the work is ultimately carried out by an appropriately licensed subcontractor.

The consequences of carrying out unlicensed building work are severe. The offence carries a maximum penalty of more than $30,000 for a first offence and possible jail time for multiple offences. Additionally, a person who carries out or undertakes to carry out unlicensed building work is not entitled to any monetary or other consideration for doing so.

It is not yet confirmed when the changes noted above will come into effect and whether they will apply to existing contracts and tenders. If you are concerned about a current subcontract or tender for which you may be unlicensed or if you would like further information on any of the issues raised in this alert please contact our Building & Construction workgroup.

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