- The Building and Construction Industry Security of Payment Amendment Act 2018 commenced on 21 October 2019. The amendment effects a number of changes to the operation of the Building and Construction Industry Security of Payment Act 1999.
- Insofar as it concerns the process of issuing a payment claim and applications for adjudication, the changes will only apply to new contracts entered into after 21 October 2019. Existing contracts will be unaffected.
- This article will look briefly at the new regulatory regime imposed under the Act. It follows an article in the March 2019 edition which provided an introductory explanation of the forthcoming amendments.
Two issues arise out of the new regulatory landscape imposed by amendments to the Building and Construction Industry Security of Payment Act 1999 (‘the Act’): the first, being implementation of a Code of Practice regulating authorised nominating authorities, and the second being certain powers given to authorised officers to allow them to investigate and enforce compliance with it.
Code of Practice
The Minister will have power to implement a new code of practice concerning authorised nominating authorities (new s 28A). The Explanatory Statement issued by Fair Trading NSW in August 2018 indicates (at p 13), that the Code of Practice was intended to replace the existing arrangements whereby an authorised nominating authority gives the Minister an undertaking to abide by a code when applying for an authority to appoint adjudicators. It seems that the new Code of Practice is intended to:
- remove concerns about the adjudicator selection process;
- remove the potential for perceptions of bias or conflicts of interest; and
- outline the standards of conduct which authorised nominating authorities and adjudicators should abide by in discharging their respective functions.
The new Code of Practice is likely to be promulgated at some point after the commencement of the Building and Construction Industry Security of Payment Amendment Act 2018 (‘the Amendment Act‘) on 21 October 2019.