Australia: Queensland introduces chain of responsibility legislation for non-conforming building products

The Queensland Government proposes to introduce comprehensive changes to its building and construction laws through the amendments to the Queensland Building and Construction Commission Act 1991 (QBCC Act) proposed by the Building and Construction Legislation (Nonconforming Building Products – Chain of Responsibility and Other Matters) Amendment Bill 2017 (Amendments), introduced in to Parliament on 26 May 2017.

The Amendments will address the growing problem of non-conforming building products (NCBPs) and attempt to eliminate the use of unsafe building products across Queensland building sites by introducing a chain of responsibility for the supply of building products. The compliance and enforcement powers of the regulator, the Queensland Building and Construction Commission (QBCC), will also be increased. The Amendments require critical attention for all participants in the building product supply chain, including designers, manufacturers, importers, suppliers and installers (Supply Chain Participants).

NCBPs are building products and materials that are marketed and supplied with misleading claims about their quality or purpose, or do not meet the required standards.

Why are the Amendments being proposed?

The Amendments are a response to 'the proliferation of cheap, imported, substandard products entering our country, [which] is a risk to the health and safety of all Queenslanders', according to Queensland Minister for Housing and Public Works, Mick de Brenni. NCBPs not only threaten the integrity of a building, putting those who enter and work on the building at risk, but also cost building owners significant amounts to rectify damages or undertake remedial action as a result of NCBPs.

Reviews of the current regulatory system have concluded that the present system does not provide an effective overarching framework for identifying and addressing NCBPs.1 The current framework also disproportionately focuses on the end of the supply chain, with tradesmen, installers and building licensees bearing the responsibility for NCBPs. The Amendments to the QBCC Act will address this inequity by establishing obligations for all participants in the building product supply chain.

Key takeaways from the Amendments to the QBCC Act:

  1. Introduction of a chain of responsibility in the supply of building products

Supply Chain Participants will have a positive obligation to, so far as reasonably practicable, ensure building products they use are safe and fit for their intended purpose. The accountability mechanism will allow the QBCC to address a point of failure in the supply chain, and the party that is responsible for an NCBP can be directed to replace a NCBP, fix a problem related to a NCBP, or may be liable for offences related to supplying or installing a NCBP.

  1. Increased powers of the regulator

Presently, the QBCC is only empowered to inspect active sites. The Amendments will extend the regulator's current powers to enable the QBCC to:

  • audit and inspect buildings that are not active building sites;
  • enter a site to collect samples of products for testing;
  • require Supply Chain Participants to produce information about alleged NCBPs;
  • direct rectifications of unsafe buildings and sites;
  • declare a building or site unsafe;
  • prosecute offences related to supplying or installing a NCBP; and
  • recall NCBPs and issue public warnings about them.

The Commissioner will also be empowered to share information with other relevant agencies, including the health and safety regulator, local governments and agencies of the Commonwealth or State. This will facilitate a uniform approach by QBCC and health and safety regulator, such that they can more effectively work together to prosecute offences related to NCBPs, to encourage compliance with the provisions and protect the public and building industry workers from harm arising from unsafe situations caused by NCBPs.

  1. Establishment of an advisory committee, the Building Products Advisory Committee

The Amendments establish a Building Products Advisory Committee (BPAC), which will assist the Minister, Commissioner and Board with advice regarding the suitability and safety of building products, promoting safe building products and raising awareness of NCBPs within the industry. The BPAC will possess all the powers necessary to perform its functions, including obtaining expert advice from industry bodies.

  1. New offences related to NCBPs

With the increased powers of the regulator, the Amendments introduce offences for contravening the obligations placed on Supply Chain Participants, to act as a deterrent for offences related to NCBPs and emphasise the seriousness of the offences. The proposed maximum penalty for breaching a duty in relation to NCBPs is currently $121,600, which is higher than penalties currently imposed by the QBCC Act.

The Amendments are expected to lead to higher building product standards, greater attention in the construction industry, more effective regulatory enforcement and ultimately result in safer infrastructure.

How can you prepare?

We can help you prepare for the changes to the laws by examining your systems that deal with building products that pass through your position in the supply chain, to ensure that you comply with the new obligations.

Report on NCBPs in the Commonwealth Government

The Queensland Government appears to have set the standard for legislation to deal with NCBPs, although the Commonwealth Government is slowly joining the move towards sharing the accountability for NCBPs. Back in June 2015, the Senate referred an inquiry and report into NCBPs to the Senate Economics References Committee. Following several delays and extensions, the interim report on the illegal importation of products containing asbestos is due to be handed down on 31 August 2017, and the final report will be released on 31 October 2017.

Footnote

1Explanatory Note, Building and Construction Legislation (Nonconforming Building Products – Chain of Responsibility and Other Matters) Amendment Bill 2017 (Hon M de Brenni MP, 26 May 2017).

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