By Aaron Gadiel, Partner
The NSW Government has introduced a proposed new law into the state parliament. The new law will rewrite the rules for development certification. The new law would entirely replace the existing system of construction certificates and occupation certificates with a new regime of building approvals and completion approvals.
The changes are set out in the Building (Approvals and Practitioners) Bill 2026. If the proposal is passed by parliament it will result (among other things) in:
This article provides an overview of the changes from the perspective of property developers and their consultants. It does not cover all aspects of the proposed changes. It focuses on the changes relevant to obtaining and managing approvals. This means, for example, it does not address provisions concerning the civil liability of developers and builders for building defects.
This article is not a replacement for legal advice.
Part 6 of the EP&A Act is currently titled ‘Building and subdivision certification’, but is proposed to be renamed ‘Subdivision certificates and building information certificates’.
All references to construction certificates and occupation certificates will be stripped out of Part 6. The scaled-back Part 6 will deal with subdivision works certificates, subdivision certificates and building information certificates.
A building approval and a completion approval will be formally issued by an ‘approval authority’ — essentially registered certifiers or a local council.
Building approvals will replace construction certificates.
Completion approvals will replace occupation certificates.
The Bill scoops up the current regulatory regime for regulated designs and design compliance declarations (set in out the Design and Building Practitioners Act 2020) and includes it in the building approvals framework.
The Bill expressly provides for the staging of building approvals.
It says that each building approval for staged building work relates only to the building work specified for the particular stage. However, the approval authority must consider the impact of other stages of the building work when deciding each application for a building approval for staged building work.
The first application for a building approval (for staged building work) will need to include a schedule of the proposed stages.
The staging schedule will need be in an approved form.
The regulations to be made under the Bill, once enacted, may:
This would introduce additional complexity to the existing system.
The Bill does not address the existing problem where some development consents are granted with conditions that effectively preclude a meaningful staging of construction certificates. This means that:
The version of the Building Code of Australia that would apply is the version that is in force:
This is probably better than the current position under the EP&A Act, which only allows for an earlier version of the Building Code of Australia to be applied for:
The Bill expressly provides for the staging of completion approvals.
Interestingly, unlike building approvals, the approval authority would (subject to yet-to-be-published regulations) be given the authority issue a completion approval even though a development consent condition has not been satisfied, if the approval authority reasonably considers:
For example, this may (in appropriate circumstances) allow a completion approval to be given for the first stage of a development, despite a condition of the development consent that requires landscaping to be completed out before any completion approval (occupation certificate) is issued.
The Bill proposes a new procedure for ‘varying’ a building approval. This replaces the existing procedure to make an application to modify a development the subject of a construction certificate.
In general terms, an approval authority would be able to consent to the variation if satisfied that the building approval would still have been issued if the variation had been included as part of the application.
However, an approval authority would not be able to issue a building approval that applies to building work that has already commenced, unless it is the subject of a ‘post-commencement authorisation’.
(The carrying out of work without a building approval would be unlawful, but this does happen from time-to-time under the existing construction certificate regime and is likely to still occur under the new regime.)
A post-commencement authorisation could only be issued by the Secretary of the Department of Customer Service — or other persons specified in (yet to be published) regulations.
The post-commencement authorisation may require that conditions and other matters be included in the building approval (or the building approval as varied). Conditions could require rectification work to be carried out.
It is not clear to us that this better than the existing regime. Under the EP&A Act no construction certificate is required for work that that has already been unlawfully carried out without a construction certificate. Commonly certifiers ask for a building information certificate to be obtained from the local council (although this is not strictly required). The new regime anticipates that a varied building approval will be required, but a proponent will have to go through a process managed by the NSW Government’s Department of Customer Service.
The Department of Customer Service would be entitled to recover ‘all reasonable costs’ it incurs in giving a post-commencement authorisation. These costs may be recovered from any of the following:
This means, for example, a landowner may be liable for the costs of the issue of a post-commencement authorisation even if they are not the beneficiary of the work (for example if the work has been carried out by a tenant or the beneficiary of an easement).
Under the EP&A Act, an application for a construction certificate or occupation certificate can be made by a person who has the benefit of a development consent. Often this will not be the owner of the land, but might be, say, a lessee or the beneficiary of an easement.
Under the Bill, an application for a building approval and completion approval would only be able to be made by the landowner, or a person who has the consent of the landowner. This effectively extends the landowner consent regime that already exists for development applications to building approval and completion approval applications.
The change is likely to complicate the process for some people looking to get construction going (or signed off) on land on which they are not the owner.
For example, it is often difficult to get the owners of land burdened by easements to consent to development applications concerning their land. Typically, such landowners are under a legal obligation to give consent, but they may not understand this. Sometimes it is necessary to threaten and even commence legal proceedings to compel consent to be given.
It is disappointing that it seems that the complications of this landowner consent regime will now extend to the new building approvals and completion approvals.
Section 73 of Environmental Planning and Assessment (Development Certification and Fire Safety) Regulation 2021 is titled ‘Certifiers may be satisfied of certain matters’.
This provision means that, no matter what a development consent says, a certifier, rather than a local council, is able to approve the final plans and specifications for a wide range of work. This has the potential to considerably speed-up the process of issuing a construction certificate (and, in relation to the finish of a building) an occupation certificate.
The streamlined process currently only applies to certain categories of matters.
Firstly, the streamlined process applies to the form or content of the plans and specifications for the following kind of work:
Secondly, the streamlined process applies matters relating to the external finish of a building.
Section 73 is authorised by section 6.29 of the EP&A Act.
The Bill will see section 6.29 — and section 73 — retained for the issue of a subdivision works certificate and a subdivision certificate only.
However, the Bill proposes an equivalent to these provisions (a new section 75 of the Bill).
This provision dumps the list set out in section 73. In simple terms the new provision says that where there is a requirement under (say) a development consent that a consent authority or local council must be satisfied about a matter (concerning the issue of a building approval or completion approval), it is enough that the approval authority (ie the certifier) is satisfied as to the matter. The consent authority and the council would not have a say.
This means, for example, that a much wider range of matters will be able to be dealt with by approval authorities (certifiers) in the development consent implementation process, rather than having to go back to the local council for approval. This is good news for property developers and builders.
However, this provision does not allow an approval authority to confirm that matters that are the subject of a deferred commencement condition are satisfied.
Under the Bill, a building approval would be required for any ‘building work’ carried out under a development consent.
This is wider that the existing EP&A Act requirement that a construction certificate is only required prior to carrying out the ‘erection of a building’.
The Bill’s provisions extend the requirement to obtain a building approval to any physical activity involved in the erection of a building. This will make it necessary to obtain a building approval prior to the carrying out of:
The existing power for principal certifiers to give written directions in relation to non-compliances will be beefed-up under the new Bill.
At present these directions are not binding. If a developer/builder does not comply with the directions, the certifier must report the matter to the consent authority. It is then up to the consent authority to decide whether to issue a development control order. A development control order is binding. The decision to issue a development control order can be appealed on its merits to the Land and Environment Court.
However, under the Bill, the system will be toughened for building work (the system will remain the same for subdivision work).
Under the proposed section 73 of the Bill, it will be a criminal offence for a person issued a written direction by an approval authority (a certifier) to not comply with the direction. (There is a maximum fine of $33,000 for individuals and $165,000 for companies.)
Bizarrely, unlike a development control order, there is no right of merit appeal against the decision to issue a direction by an approval authority. This places developers and builders in an unusually vulnerable position if one of these directions are issued. It may be necessary to commence judicial review proceedings (challenging the legality of a written direction) if a developer or builder feels that the notice has been unlawfully issued.
There is an existing power of the Land and Environment Court to substitute its own decision in place of a decisions by a certifier that the plans and specifications the subject of a construction certificate are consistent with the development consent. Proceedings need to be commenced within three months. This power will not be carried forward to new building approvals regime.
The Court will retain its general power of judicial review in relation to unlawful decisions, but it seems it will lose its general power to substitute its own opinion for that of the certifier when the question of consistency is disputed.
This increases the certainty about the status of a building approval and should be welcomed by property developers and builders. However, it should be appreciated that it may not protect property developers and builders from legally unreasonable decisions, which can still be challenged in judicial review proceedings.
The Bill proposes the regulation of ‘prefabricated buildings’.
In broad terms, these are generally defined as follows.
Firstly, a substantially complete building or room if manufactured away from a building site.
Secondly, a building component manufactured away from a building site that:
In general terms, building work involving a prefabricated building would not be able to commence unless a ‘prefabricated building declaration’ and ‘prefabricated building instructions’ have been:
This requirement will apply to, among other things, manufactured homes.
At present, the definition of a ‘building’ under the EP&A Act excludes a manufactured home.
This has two consequences.
Firstly, the installation of a manufactured home is not, in itself, ‘development’ as it does not constitute the ‘erection of a building’.
Secondly, a construction certificate does not need to be obtained for a manufactured home.
The Bill seeks to change this.
The EP&A Act’s definition of a ‘building’ will no longer exclude a manufactured home.
As a result, under the EP&A Act, the installation of a manufactured home will require development consent (unless it is identified under an environmental planning instrument as exempt development or development that does not require consent).
There would no longer be a requirement to obtain a ‘section 68’ approval under the Local Government Act 1993:
These changes will likely trigger a review of the development standards for manufactured home estates and how they are managed. In general terms, these are currently set out by the NSW government in a statewide regulation under the Local Government Act 1993. It would seem that these standards will need to move into some document in force under the EP&A Act. It is not yet clear whether this will be a state environmental planning policy — or if local councils will be free to make up their own rules under, say, a development control plan.
It is not yet clear whether the Bill will be passed by the parliament and, if it is, what amendments may be made to it. If the Bill is passed, it is likely that its key provisions will not come into effect for some time.
These proposed changes are mixed. There are some very positive elements. However, there is also an extension of the regulatory burden in some areas.
Past ‘reforms’ have taught us to be very sceptical about such wide-ranging changes. Experience suggests that there will be many legal and bureaucratic complications.
If you would like further information or have any queries regarding other matters, please do not hesitate to contact:
