COAG DECISION REGULATION IMPACT STATEMENT

Transcription

1 COAG DECISION REGULATION IMPACT STATEMENT PROPOSAL FOR NATIONAL LICENSING OF THE PROPERTY OCCUPATIONS QUEENSLAND CONSULTATION This document highlights some of the key differences between current licensing arrangements and those proposed under national licensing in the COAG Decision Regulation Impact Statement and poses a number of questions for Queensland stakeholders. Your submissions will assist the Queensland Government to develop its final position on the national licensing reform. The Council of Australian Governments Standing Council for Federal Financial Relations will consider the Decision Regulation Impact Statement, legislative package, and the results of this consultation before making a final decision regarding national licensing.

2 I. Options considered in Decision RIS Option 1 National licensing (recommended option) The Decision RIS recommends national licensing for the property occupations. Under national licensing, licence requirements would be consistent in all jurisdictions and uniform licence categories would be issued. A national policy framework would apply overseen by the National Occupational Licensing Authority, which would help ensure consistency. National licensing represents the highest net benefit to the community, taking all impacts into account, when compared against the other options considered. It would achieve significant benefits through improved labour mobility and reduced red tape for businesses and licensees. While this benefit would be greatest for larger companies working in multiple jurisdictions, it would also be felt by small businesses, which would more readily be able to attract staff from other states and territories and to understand the scope of the licences prospective employees may hold. Option 2 Automatic mutual recognition Under this option each jurisdiction would continue to issue licences against existing jurisdictional categories and associated scopes of work, but they would recognise each other s licences without the licensee having to reapply for a licence or pay an additional fee. Recognition would be restricted to those licences where equivalency has been agreed. For licences where no equivalent has been agreed, current mutual recognition requirements would continue to apply. Under automatic mutual recognition, the regulated work for the licence category would not be harmonised or made consistent. Regulators and employers would therefore be responsible for understanding the scope of work authorised under the licence issued by another jurisdiction. While automatic mutual recognition has the potential to provide for a level of enhanced labour mobility, the complexities of operating such a system would make implementation extremely difficult and require close cooperation and coordination at all levels of policy development, regulation setting and compliance. This option would deliver fewer benefits and give rise to a more complex, less transparent and a more high risk environment with far less opportunity for reduced regulation and reduced prospect for the longevity of the reform over time. Automatic mutual recognition is therefore not the preferred option. Option 3 Status quo Under this option, there would be no changes to existing licensing and mutual recognition arrangements. This option would not address current regulatory complexities and is not the preferred option. 1. Which of the following is your preferred model for licensing reform: (i). national licensing (ii). automatic mutual recognition (iii). status quo (iv). other II. Proposed licence categories National licensing proposes to establish the following uniform licence categories: (i). real estate agent; (ii). business agent; (iii). strata managing agent; (iv). agent s representative registration; (v). real estate auctioneer. Page 2

3 Under national licensing Queensland would offer every national licence category, except the stratamanaging agent licence. If a participating jurisdiction does not license a scope of work, the participating jurisdiction may choose not to offer that licence. Consequently, not every participating jurisdiction will offer every licence category. The following Queensland licences would cease under national licensing: resident letting agent licence; limited real estate agent s licence (business letting); limited real estate agent s licence (affordable housing); pastoral house licence; pastoral house director s licence; pastoral house manager s licence; pastoral house auctioneer s licence; pastoral house salesperson s licence; property developer s licence; property developer director s licence; property developer salesperson s licence; trainee auctioneer s licence. Persons who currently hold one of these licences would be transitioned to a national licence with an equivalent scope of work, if the work is licensed under national licensing. 2. Do you agree with the proposed licence categories? III. Proposed regulated work Real estate agency work (1) Real estate agency work means selling, purchasing, exchanging, leasing, managing or otherwise dealing with real property, on behalf of another person, for fee, gain or other reward. (2) Real estate agency work does not include the following (a) strata managing agency work; or (b) selling, purchasing, exchanging, leasing, managing or otherwise dealing with real property that (i). is not rural land; and (ii). is used, or intended to be used, wholly for purposes other than residential purposes; (iii). and has an estimated contract price of at least a prescribed amount or has an area greater than a prescribed area. (3) Estimated contract price for selling, purchasing, exchanging, leasing or managing or otherwise dealing with real property, means the true estimate, made on reasonable grounds by the person carrying out the work, of the price payable for the real property transaction. (4) Rural land means land used or apparently intended to be used, for gain or profit for grazing livestock or cultivating crops. (5) Residential real property means real property that is used, or is intended to be used, for residential purposes and does not include real property that is used primarily for the purposes of industry, commerce or primary production. The scope of work for the national real estate agent s licence differs from the Queensland real estate agent s licence in that it does not include the sale of property that is not real property. The sale of businesses will be licensed separately under the national business agent s licence. The sale of livestock and chattels may continue to be licensed in Queensland separately to the national real estate agent s licence. This matter will be considered as part of the proposed split of the Property Agents and Motor Dealers Act 2000 into separate Acts. Page 3

4 The scope of work for the national real estate agent s licence does not include dealings with real property: that is not rural land; that is not used or intended to be used for purposes other than residential purposes (commercial, industrial or primary production); and that has an estimated contract price of at least a prescribed amount or an area greater than a prescribed area. This work will become unlicensed under national licensing. The objective of this threshold is to exclude the upper end of the property market, but it is not clear how this exclusion will operate in practice. Real estate agency work over an estimated contract price or involving real property of greater than a prescribed area will not require a real estate agent s licence. The estimated contract price will be a prescribed amount. An amount of $10,000,000 was initially proposed. The person carrying out the work determines the estimated contract price, but it must be a true estimate, made on reasonable grounds. The estimated contract price is not the value of the real property in the transaction, but the price payable for the real property transaction. An area greater than 10,000m 2 was proposed to be the prescribed area. Where real property (that is not rural land or used for residential purposes) is greater than the area prescribed, a real estate agent s licence will not be required to deal in that real property. It is not clear whether an individual lot, or the combined area of lots in one transaction, must exceed the prescribed area. The exclusion was introduced at the request of the Shopping Centre Council of Australia, which considered that persons dealing in property of this nature are sophisticated participants in the property industry who do not require the consumer protection provided by the licensing regime for real estate agents. If national licensing is implemented, persons holding a Queensland real estate agent s licence will be entitled to be transitioned to a national real estate agent s licence and a national business agent s licence. The national business agency licence is discussed below. The conduct requirements under the Property Agents and Motor Dealers Act 2000 will continue to apply to the real property work excluded from the scope of the national real estate agent s licence. 3. Do you support the proposed scope of work for the real estate agent s licence? 4. Do you support the proposal that the sale of livestock and other chattels will continue to be licensed work in Queensland after the commencement of national licensing? 5. Do you support the proposal that dealings with real property that is not rural or residential with an estimated contract value over a certain amount should become unlicensed work after the commencement of national licensing? If so, what contract value should be prescribed? 6. Do you support the proposal that dealings with non rural or non residential real property that has an area greater than a prescribed area will become unlicensed work after the commencement of national licensing? If so, what area should be prescribed? Page 4

5 Business agency work Business agency work means the sale, purchase or lease of a business, on behalf of another person, for fee, gain or other reward. Queensland currently licenses the sale, lease, etc. of businesses under the real estate agent s licence. If national licensing is implemented, dealings with interests in a business will be licensed separately under the business agent s licence. The business agent s licence has specific business broking qualifications (discussed further below in the eligibility section). If national licensing is implemented, persons holding a Queensland real estate agent s licence would be entitled to be transitioned to a national real estate agent s licence and a national business agent s licence. New licence applicants will be required to obtain the separate business agent s licence after completing the required qualifications. 7. Do you support the proposed scope of work for the business agent s licence? Strata managing agency work Queensland does not currently license strata managing work because it is regulated under the Body Corporate and Community Management Act If national licensing is implemented, Queensland does not intend to offer the strata managing agent s licence as part of national licensing and consequently, this work will remain unlicensed work in Queensland. Other jurisdictions may choose to offer the strata managing agent s licence after the commencement of national licensing. A person in Queensland who wishes to carry out this work in a jurisdiction that does offer the strata managing agent s licence will have to obtain the strata managing agent s licence in that jurisdiction. Agent s representative registration The agent s representative registration is equivalent to Queensland s existing real estate salesperson licence. The agent s representative will be authorised to carry out real estate agency and business agency work, under the supervision of a person who holds a real estate agent s or business agent s licence. 8. Do you support the proposed scope of work for the agent s representative registration? Real estate auctioneering work Real estate auctioneering work means the auctioning of real property, on behalf of another person, for fee, gain or other reward. If national licensing is implemented, the real estate auctioneer licence will authorise the auctioneering of real property but will not include other property such as chattels or livestock. The auctioning of chattels and livestock may continue to be licensed work in Queensland after the commencement of national licensing. This matter will be considered as part of the proposed split of the Property Agents and Motor Dealers Act 2000 into separate Acts for property agents and other kinds of agents. The national real estate auctioneer s licence will only be offered to individuals (natural persons). Bodies corporate (companies) will not be able to obtain a real estate auctioneer licence. If national licensing is implemented, the Queensland trainee auctioneer s licence will no longer be offered. This is because individuals will no longer be required to conduct auctions as a trainee prior to being qualified to become an auctioneer. National licensing will not prescribe experience requirements for Page 5

6 real estate auctioneers. Persons who currently hold the Queensland trainee auctioneer s licence would be transitioned to the national real estate auctioneer s licence. 9. Do you support the proposal that the auctioning of chattels and livestock should continue to be licensed work in Queensland after the commencement of national licensing? 10. Do you support the proposal for the real estate auctioneer s licence to only be available to individuals? 11. Do you support the proposed scope of work for the real estate auctioneer licence? Why Livestock The Interim Occupational Licensing Advisory Committee for the Property Occupations determined that dealings in livestock should not be licensed under national licensing and as a result, this work has been excluded from the national licences for real estate agents or auctioneers. However, some respondents to the Consultation RIS for the Property Occupations considered that there should be an endorsement on the national real estate agent s licence for the sale of livestock and that there should also be a national livestock auctioneer licence. The Decision RIS discusses the proposal on pages Do you support the proposal to license either: (i) the sale of livestock in national licensing; or (ii) the auctioning of livestock in national licensing? 13. Do you support the proposal that: (i) the sale of livestock requires an additional endorsement on the national real estate agent s licence; or (ii) the auctioning of livestock requires an additional licence to the national real estate auctioneer s licence? IV. Proposed exemptions Exemptions Short term residential letting If national licensing is implemented, a person who carries out regulated work that consists only of leasing residential real property for periods of less than three months will be exempt from the requirement to hold a real estate agent s licence. Two or more consecutive lettings of the same residential property to the same person will be considered to be a single letting for calculating the length of the lease. The resident letting agent licence currently issued in Queensland will no longer be offered after the commencement of national licensing, as this work will no longer require a licence. 14. Do you support the proposed exemption for short term letting? Page 6

7 Exemptions Related entities If national licensing is implemented, related entities will be able to carry out regulated work for each other without being required to hold a licence, provided that the person carrying out the regulated work notifies others that the person is related to the entity that owns the property. The related entities exemption was included at the request of the Shopping Centre Council of Australia. The ownership of a shopping centre is often held by one company (the owner company), while another related company will manage the shopping centre for the owner company, negotiating and entering leases with tenants and arranging required maintenance (the managing company). The related entities exemption would allow a managing company that is a related company of an owner company to manage property for the owner company for a fee without needing to hold a real estate agent s licence. The related entities exemption only permits an entity to carry out regulated work for a related entity. It does not permit an entity to offer property services to the public. The related entities exemption also allows entities to be prescribed as related entities under the national regulations. This means that the national regulations can provide that a particular corporate group or other similar arrangement be exempted from the requirement to obtain a property licence to carry out regulated work for entities in that corporate group or arrangement. If this exemption is included in national licensing, and your company holds a licence in the property occupation solely to carry out licensed work for a company that is related to your company (as defined under the Corporations Act 2001 (Cwth)), your company would no longer need to hold that licence after the commencement of national licensing. 15. Do you support the proposed exemption for related entities? 16. Do you support the entities listed as related entities? : V. Proposed eligibility requirements To be eligible for a national licence, the applicant must meet the eligibility requirements for the licence. The National Law prescribes qualification requirements and personal and financial probity requirements. The personal and financial probity requirements are similar to the suitable person requirements for licensees in the Property Agents and Motor Dealers Act The personal and financial probity requirements are discussed on pages of the Decision RIS. The qualification requirements for the national licences are discussed in detail on pages of the Decision RIS. The qualification requirements under national licensing will differ from existing requirements in a number of ways. Queensland currently requires the completion of 19 units of competency from the Certificate IV in Property Services (Real Estate) to obtain a real estate agent s licence. The National Law requires the completion of the full Certificate IV to obtain the national real estate agent s licence. This requires the completion of 24 units. The Real Estate Institute of Australia strongly supports a Diploma level qualification for a real estate agent s licence. The diploma requires the completion of 26 units of competency. Furthermore, new licence applicants who wish to carry out business agency work will have to complete the full Certificate IV in Property Services (Business Broking) to obtain this licence (12 units), including nine specific units from that certificate. This is an increase in qualification requirements in Page 7

8 Queensland, as previously this work could be carried out by a real estate agent without completing any additional qualifications relating to business agency work. However, a person who holds a national real estate agent s licence needs to complete only one additional unit of competency to satisfy the qualification requirements to obtain the national business agent s licence. Two units of competency will be required if a proposed new unit is included in the certificate. Applicants for a real estate salesperson s registration in Queensland need to complete seven units of competency to obtain the registration. Only four units are required to obtain the national agent s representative registration. Currently applicants for an auctioneer s licence in Queensland have to complete five units of competency and conduct five auctions as a trainee auctioneer under the supervision of an auctioneer to qualify for an auctioneer s licence. Under national licensing an applicant for a real estate auctioneer s licence will only need to complete three units of competency and will not be required to conduct any auctions or obtain any other practical experience as an auctioneer. If you have completed or commenced a course of training that would have entitled you to obtain a licence in Queensland at the commencement of national licensing, you would be taken to meet the qualification requirements to obtain the equivalent national licence and would not be required to undertake additional training. 17. Do you agree with the proposed qualification requirements the national licences? 18. In Queensland, individuals are required to carry out five auctions as a trainee auctioneer before being eligible to obtain an auctioneer s licence. Under national licensing it is proposed that there will be no experience requirements. Do you agree with this proposal? Page 8