Building Services (Registration) Act 2011

The Board must not declare a person to be an excluded contractor unless —

the Board has given the person a written notice of its intention to consider making the declaration (a show cause notice); and

the show cause notice identifies the insolvency event or events on which the declaration would be based; and

the Board has given the person the opportunity to make a submission to the Board on the matter within 28 days or any longer period that is specified in the show cause notice.

The Board must not declare a person to be an excluded contractor if the person satisfies the Board that —

reasonable steps were taken to avoid the circumstances that resulted in the insolvency or insolvencies concerned; and

sufficient arrangements are in place to ensure that the person’s construction work business will be managed in a competent and proficient manner.

The Board must not declare a corporation to be an excluded contractor because a particular individual is an officer of the corporation if the corporation satisfies the Board that the individual is no longer an officer of the corporation.

For the purposes of this section, the reasonable steps taken to avoid the circumstances that resulted in insolvency may include (but are not limited to) the following —

keeping proper accounting records;

obtaining appropriate financial or legal advice before entering into significant business arrangements;

reporting fraud or theft in relation to the business;

putting in place appropriate credit arrangements and taking reasonable steps to recover outstanding money owed;

making adequate provision for Commonwealth and State taxes and employee entitlements;

ensuring there are sufficient assets to meet guarantees.

Reasonable steps for the purposes of this section do not require a person to contribute additional equity to a business to prevent insolvency.

Reasonable steps for the purposes of this section require consideration of the circumstances existing before an insolvency that were known to the individuals who could have prevented the insolvency and whether the individuals were in a position to control the circumstances that resulted in the insolvency.

For the purposes of this section, sufficient arrangements to ensure that a person’s construction work business will be managed in a competent and proficient manner may include (but are not limited to) the following —

the appointment of additional company directors or business managers;

the engagement of financial or legal advisers on an ongoing basis;

the provision of sufficient working capital and equity;

credit management arrangements and other appropriate business plans.