The Design and Building Practitioners Act 2020 (NSW) (Act) received assent on 11 June 2020. The property development and construction industry in NSW has been eagerly awaiting the finalisation of the Regulations, which have now been released after a period of consultation. These contain the detail for the new registration and declaration regime for work on Class 2 buildings, or mixed use buildings that have a Class 2 part, in NSW.
Here we summarise the key takeaways and what you need to do to prepare for the 1 July 2021 commencement.
The table below outlines what you need to do for work on Class 2 buildings, or mixed use buildings with a Class 2 part.
* Note: There are special requirements for Engineers that are not summarised in this article.
The Act created a legislative regime for builders and designers of buildings to:
The Regulations now provide further details on how the regime will operate and who will be covered by the new regime.
The Act also introduced a new duty of care, and investigation and enforcement provisions. Those provisions are not summarised in this article. You can read our previous summary of the Act Double Bill! New rules for NSW construction industry.
The new regime for registration and declaration applies only to the construction, alteration, addition, repair, renovation, or protective treatment of Class 2 buildings and mixed use buildings that contain a Class 2 part. This means that the whole of a mixed use building, if it contains a Class 2 component, will be covered by the regime (including the parts that are not Class 2).
The Regulations provide a useful example: the Act and the Regulations apply to the whole of a mixed use building that is comprised of Class 2, Class 3 and Class 6 parts, including the Class 3 and Class 6 parts.
Practitioners who want to work on Class 2 buildings, or mixed use buildings with a Class 2 part, must register from 1 July 2021 through the NSW Planning Portal. To accommodate the anticipated influx of applications for registration, the Regulations provide that applications lodged between 1 July to 31 December 2021 will receive deemed approval in certain circumstances.
The Regulations provide for various categories of registration (e.g. architectural, structural engineering, general building). Individuals and bodies corporate can be registered, subject to certain conditions.
Builders must hold a contractor licence under the Home Building Act 1989 (NSW), and have 5 years' recent practical and relevant experience, before qualifying for registration.
Regulated Designs must be at 'construction issue' standard before work commences on-site. This is a significant departure from the typical design and construct (D&C) model that is popular among property developers and builders. This change is intended to minimise the risk of design defects.
Builders may still be engaged under a D&C contract, and therefore bear the risk for design development. However, the Regulatory Impact Statement clearly states: 'designs for all the building works that require a regulated design must be lodged prior to any building work commencing'. Therefore, project programs will need to be adjusted to allow for all design work for critical elements of the building to be completed before construction commences.
The time for lodging declarations and Regulated Designs in the NSW Planning Portal is confirmed in the Regulations:
Note that in addition, the Act requires declarations to be provided to clients and certifiers.
For applications for certificates made on or after 1 July 2021, a construction certificate or a complying development certificate for building work cannot be issued unless the person who issues the certificate has received:
Variations to Regulated Designs must be re-declared and lodged in the NSW Planning Portal no later than 1 day after the building work in respect of that variation is commenced by the builder. This ensures that builders must build in accordance with the designs that have been declared and lodged in the NSW Planning Portal.
Certain variations must be recorded in a 'variation statement'.
Designers and builders must comply with a Code of Practice. The code is set out at Schedule 4 of the Regulations and includes obligations to act in good faith and to avoid conflicts of interest.
Engineers and designers who want to work on Class 2 buildings (or buildings with a Class 2 part) must be insured in accordance with the Regulations, but there are deferred dates for application of the insurance provisions up to 1 July 2023. The Regulations do not stipulate a minimum dollar amount for professional indemnity insurance.
The draft Regulations issued for public consultation in November 2020 provided for a hard commencement date on 1 July 2021. The final Regulations now amend Schedule 1 of the Act to provide a more nuanced transitional period for existing projects depending on when work is commenced.
It is important that developers, builders, engineers and designers working on Class 2 buildings, or mixed use buildings containing a Class 2 part, comply with the new regime. Failure to comply can result in an occupation certificate being withheld, or fines being imposed.
You should act now to get your business ready for 1 July 2021. If you have an existing project, review the transitional provisions in Schedule 6 of the Regulations to determine how the Regulations apply and seek any necessary advice.
For advice on this matter, please reach out to a member of our National Building Regulation and Compliance team.