SOP Legislation in Australia
August 06, 2021
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There are eight states and territories in Australia, each with its own security of payment (SOP) legislation. This causes challenges for contractors, lawyers, consultants, and the like that work across the different jurisdictions, because each SOP legislation differs.
The first jurisdiction to introduce SOP legislation in Australia was New South Wales (NSW) in 1999. In the early 2000s SOP legislation was introduced in other Australian Jurisdictions. The NSW legislation formed the basis of the model used for the East Coast of Australia, and Western Australia (WA) and Northern Territory (NT) Acts more closely aligned with the construction industry payment legislation in the UK and New Zealand (NZ).
The Australian Acts create a statutory dispute resolution process (Adjudication) that allows a party (the Applicant) alleging they are owed monies under a construction contract to promptly obtain payment from another party (the Respondent), based on an assessment of the merits of the claim by an appropriately qualified and independent adjudicator.
The current SOP legislation in force in the Australian jurisdictions includes the following:
- Building and Construction Industry Security of Payment Act 1999 (the NSW Act).1
- Building and Construction Industry Security of Payment Act 2002 (the Vic Act).
- Building Industry Fairness (Security of Payment) Act 2017 (the QLD Act).
- Construction Contracts Act 2004, as amended by the Construction Contracts Amendment Bill 2016 (the WA Act).
- Construction Contracts (Security of Payments) Act 2004 (the NT Act).
- Building and Construction Industry (Security of Payment) Act 2009 (the SA Act).
- Building and Construction Industry (Security of Payment) Act 2009 (the ACT Act)
- Building and Construction Industry (Security of Payment) Act 2009 (the Tasmanian Act)
1: Substantial amendments were made to the NSW Act on 21st October 2019.