Fair Trading (Building and Construction Industry Dispute Resolution Code) Regulations 2017

This instrument organises dispute resolution around a small set of legal concepts. State their meaning and operational effect as given in the text.

Industry and participants (reg 4; Schedule 1, cl 2)

• The regulations expressly treat the building and construction industry as "an industry" for Part 3A of the Act (reg 4(a)). That is a formal prescription so Part 3A’s industry-code machinery applies.
• "Participant" is defined by the regulation in breadth. It includes persons carrying on a business in the building and construction industry, businesses connected to the industry, suppliers of goods or services where the supply occurs in connection with carrying on such a business, and persons who have contracted to carry out construction work or to supply related goods and services under a construction contract (reg 4(b)(i)-(ii); Schedule 1, cl 2 notes the term). The definitions adopt the construction-contract related terms as those used in the Building and Construction Industry Security of Payment Act 2009 (reg 3).

The code (reg 5(1); Schedule 1)

• The Building and Construction Industry Dispute Resolution Code 2017 is prescribed as an industry code (reg 5(1); Schedule 1, cl 1). The code itself is the procedural instrument that sets out when ADR may be commenced and what participating parties must do (Schedule 1, cl 3-4).

Alternative dispute resolution procedure (Schedule 1, cl 2)

• The code uses the term alternative dispute resolution procedure repeatedly and explicitly excludes arbitration from that term (Schedule 1, cl 2). That is a definitional limit on what an authorised officer may start under the code.

Authorised officer and the Commissioner (reg 3; reg 5(2); Schedule 1, cl 4)

• The Commissioner is the Small Business Commissioner for the purposes of these regulations (reg 3). The Commissioner is given administrative responsibility for the code (reg 5(2)).
• The instrument repeatedly uses the term "authorised officer" as the person who may commence and conduct ADR, make requests of parties, refer disputes to mediation, appoint experts, suspend or terminate procedures, and issue certificates (Schedule 1, cl 4). The instrument itself does not define "authorised officer", so the role is a functional one established by the code’s powers and likely defined elsewhere in Part 3A or in the Commissioner’s administrative arrangements.

Mandatory participation and conduct obligations (Schedule 1, cl 4(2)-(4))

• Once ADR is commenced, parties (or authorised representatives) must attend and participate as required by the authorised officer (Schedule 1, cl 4(2)). Participants must act reasonably, fairly, honestly and cooperatively; must not mislead, harass, intimidate or oppress another party (Schedule 1, cl 4(3)). Parties must comply with reasonable requests by the authorised officer, including exchanges of information, answering questions, attending meetings and participating in mediation (Schedule 1, cl 4(4)).

Timing and compliance (Schedule 1, cl 4(6))

• Requests by an authorised officer must be complied with as soon as reasonably practicable and, for written requests, within 14 days or a longer period as allowed by the authorised officer (Schedule 1, cl 4(6)).

Expert advisers and costs (Schedule 1, cl 4(7)-(8))

• An authorised officer may, after consultation with parties, appoint an expert adviser to assist (Schedule 1, cl 4(7)(b)). Parties are equally liable for the costs of expert advice unless they agree a different apportionment (Schedule 1, cl 4(8)).

Suspension, termination and certificates (Schedule 1, cl 4(9)-(13))

• The authorised officer may suspend or terminate ADR where the dispute is the subject of court/tribunal proceedings, arbitration or another ADR (Schedule 1, cl 4(9)), or if the officer forms the view the dispute has no reasonable prospect of resolution or is frivolous or vexatious (Schedule 1, cl 4(10)). After completion the authorised officer must provide a certificate recording parties, nature of dispute and whether resolution occurred and, if so, the terms (Schedule 1, cl 4(11)). Communications and documents prepared in connection with ADR are confidential unless otherwise agreed, but the certificate may be produced in a court or tribunal (Schedule 1, cl 4(12)-(13)).

Civil penalty and expiation fees (reg 6)

• A contravention of section 28E of the Act that is constituted by contravention of the code is to be subject to a civil penalty under Part 7 Division 3A of the Act (reg 6(1)). The regulations set expiation fees for alleged contraventions, $4 000 for bodies corporate and $500 for natural persons (reg 6(2)).

Mediation fees and recovery (reg 7)

• Where mediation is arranged by an authorised officer with parties’ agreement, each party must pay $195 per day or part day; the fee is a debt due to the Crown and the Commissioner may waive it in a particular case (reg 7(1)-(3)).

These are the instrument’s principal concepts and the direct operational consequences that flow from them as written.

The instrument explicitly identifies who is within its scope and who takes decisions under it.

Scope: participants in the building and construction industry (reg 4; Schedule 1, cl 3)

• The regulations take a broad approach to “participant” status. They extend beyond contractors doing construction work to include businesses that have a connection to the building and construction industry and businesses that supply goods or services to persons involved in the industry where the supply occurs in connection with carrying on a business in that industry (reg 4(b)(i)(A)-(C)). The prescription also specifically includes persons who have undertaken construction work under a construction contract or to supply related goods and services under a construction contract (reg 4(b)(ii)). The construction-contract related terms are cross‑referenced to the Building and Construction Industry Security of Payment Act 2009 meanings by reg 3.

Disputes captured (Schedule 1, cl 3)

• The code applies both to disputes relating directly to a construction contract to which participants are parties (Schedule 1, cl 3(a)) and to disputes connected with the acquisition or supply, or potential acquisition or supply, of goods or services relating to carrying on business in the building and construction industry (Schedule 1, cl 3(b)). That second limb brings disputes with prospective suppliers or customers into scope where the goods or services relate to carrying on the business.

Who makes decisions: the Commissioner and authorised officers (reg 5(2); Schedule 1, cl 4)

• The Commissioner (Small Business Commissioner) is responsible for administering the code (reg 5(2)), and authorised officers (role not defined within the instrument) conduct ADR, make requests of parties, appoint experts after consultation, refer disputes to mediation, suspend or terminate ADR, and issue certificates (Schedule 1, cl 4(1), (4), (7)-(11)). Thus administrative power is concentrated with the Commissioner’s office and with persons designated as authorised officers.

Financial impacts on participants (reg 6(2); reg 7(1)-(3); Schedule 1, cl 4(8))

• Parties to mediation must pay $195 per party per day (reg 7(1)). If expert advice is appointed, parties are equally liable for those costs unless they agree otherwise (Schedule 1, cl 4(8)). Expiation fees for alleged civil-penalty contraventions are $4 000 for a body corporate and $500 for a natural person (reg 6(2)). Mediation fees are recoverable as a debt due to the Crown (reg 7(2)). The Commissioner may waive mediation fees in a particular case (reg 7(3)).

Behavioural obligations on participants (Schedule 1, cl 4(2)-(6))

• If ADR is commenced, parties must attend or otherwise participate (Schedule 1, cl 4(2)). They must act reasonably, fairly, honestly and cooperatively and must not mislead, harass, intimidate or oppress another party (Schedule 1, cl 4(3)). They must comply with reasonable requests by the authorised officer, including exchange of information and answering questions (Schedule 1, cl 4(4)-(6)). Written requests must be complied with within 14 days unless the authorised officer allows longer (Schedule 1, cl 4(6)).

Interaction with external processes (Schedule 1, cl 4(9)-(10))

• The authorised officer may suspend or terminate ADR where the dispute is the subject of court or tribunal proceedings, arbitration, or another ADR (Schedule 1, cl 4(9)). The officer may also terminate where there is no reasonable prospect of resolution or the dispute is frivolous or vexatious (Schedule 1, cl 4(10)). Therefore participants who commence court or arbitration proceedings should expect the code procedure may be suspended.

Who pays and who decides to waive

• The Commissioner has the discretion to waive mediation fees (reg 7(3)). Other cost decisions (for example apportionment of expert costs) default to equal liability unless parties agree otherwise, but parties can contractually agree different arrangements (Schedule 1, cl 4(8)).

In short, the regulations affect a broad set of commercial actors who carry on construction-related businesses, suppliers where supplies are in connection with such businesses, and contracting parties to construction contracts. The administrative, enforcement and procedural decisions are made by the Small Business Commissioner’s office and authorised officers, with financial and participation obligations falling directly on the parties in dispute.

The regulations and the prescribed code create a set of duties, procedural rights and administrative discretions. Below are the principal ones spelled out with their legal source.

Duties to participate and to behave (Schedule 1, cl 4(2)-(4))

• Duty to attend and participate: Once the authorised officer commences an alternative dispute resolution procedure, a party or an authorised representative "must attend or otherwise participate in the procedure, as required by the authorised officer" (Schedule 1, cl 4(2)).
• Duty of conduct: Participants must "act reasonably, fairly, honestly and cooperatively" and must not mislead, harass, intimidate or oppress other parties (Schedule 1, cl 4(3)).
• Duty to comply with reasonable requests: Participants must comply with reasonable requests from the authorised officer, which may include exchanging relevant information, answering questions on matters relevant to the dispute, attending meetings, and participating in mediation or other ADR forms (Schedule 1, cl 4(4)).

Timing duty for written requests (Schedule 1, cl 4(6))

• Practical timing duty: A request by an authorised officer must be complied with "as soon as reasonably practicable" and, in the case of a written request, within 14 days or such longer period as allowed by the authorised officer (Schedule 1, cl 4(6)). This creates a default short compliance window for documentary or information requests.

Duty to share expert costs (Schedule 1, cl 4(8))

• Cost sharing duty: Where the authorised officer appoints an expert adviser to assist, parties are equally liable for the expert costs unless they agree otherwise in writing (Schedule 1, cl 4(7)(b)-(8)). This is a default cost allocation for expert assistance.

Mediation fee payment (reg 7(1))

• If mediation is arranged by an authorised officer with the parties’ agreement, each party must pay $195 per day or part of a day the mediation occurs (reg 7(1)). The fee is payable notwithstanding the outcome unless the Commissioner exercises a waiver (reg 7(3)).

Expiation and civil-penalty exposure (reg 6(1)-(2))

• Civil penalty treatment: A contravention of section 28E of the Act that is constituted by contravention of the prescribed code is subject to civil penalties under Part 7 Division 3A of the Act (reg 6(1)). The regulations fix expiation fees for alleged contraventions at $4 000 for bodies corporate and $500 for natural persons (reg 6(2)). The instrument does not, within its text, describe enforcement steps under the Act; those steps operate through the Act’s civil-penalty machinery as indicated.

Right to confidentiality, with a limited exception (Schedule 1, cl 4(12)-(13))

• Right to confidentiality: Unless the authorised officer and the parties otherwise agree in writing, communications and documents prepared in connection with ADR under the code must be treated as confidential (Schedule 1, cl 4(12)).
• Exception: The certificate provided by the authorised officer under Schedule 1, cl 4(11) may be produced before a court or tribunal (Schedule 1, cl 4(13)). The certificate must state the names of parties, nature of matters, and whether the procedure was terminated without resolution or the terms of resolution (Schedule 1, cl 4(11)). That makes the certificate an admissible document despite general confidentiality.

Discretionary powers exercisable by authorised officers and Commissioner (reg 5(2); reg 7(3); Schedule 1, cl 4)

• Commissioner’s administrative responsibility: The Commissioner administers the code and Part 3A in relation to the code (reg 5(2)). The Commissioner may also waive mediation fees if satisfied it is appropriate in a particular case (reg 7(3)). The authorised officer has multiple discretions: to commence ADR after being satisfied the applicant has made a reasonable attempt to resolve and the dispute is not frivolous or vexatious (Schedule 1, cl 4(1)); to appoint experts after consultation (Schedule 1, cl 4(7)(b)); to refer to mediation (Schedule 1, cl 4(7)(a)); to request that an authorised person attend (Schedule 1, cl 4(5)); to suspend or terminate ADR where other proceedings exist or where there is no reasonable prospect or where the dispute is frivolous or vexatious (Schedule 1, cl 4(9)-(10)).

Procedural rights to seek ADR and to obtain a certificate (Schedule 1, cl 4(1), (11))

• Right to apply: A party may make a written application to the Commissioner asking an authorised officer to commence ADR (Schedule 1, cl 4(1)).
• Right to a certificate: Following completion, the authorised officer must provide a certificate recording the outcome and essential particulars (Schedule 1, cl 4(11)). That certificate can be used in later proceedings (Schedule 1, cl 4(13)).

Default exclusions and definitions (Schedule 1, cl 2)

• Arbitration excluded: The code explicitly excludes arbitration from its definition of alternative dispute resolution procedure (Schedule 1, cl 2). Therefore an authorised officer cannot commence arbitration under the code.

These duties and rights create a structured administrative ADR pathway with mandatory participation obligations, short compliance timelines, default cost allocations for experts and mediation, confidentiality protections with a narrow exception for the official certificate, and civil-penalty exposure for code contraventions linked to the Fair Trading Act.

The instrument links contraventions of the code to the Fair Trading Act’s civil-penalty regime and fixes expiation amounts for alleged contraventions. It also creates recoverable fees for mediation and leaves operational enforcement action to the Act’s machinery and the Commissioner’s office.

Civil-penalty exposure (reg 6(1))

• Subject matter: Regulation 6(1) provides that a contravention of section 28E of the Fair Trading Act 1987 that is constituted by contravention of the code is a civil penalty contravention under Part 7 Division 3A of the Act. The instrument therefore does not itself set the civil penalty quantum beyond the expiation fees for immediate discharge; instead it channels contraventions into the Act’s civil-penalty mechanism.

Expiation fees (reg 6(2))

• Fixed amounts: The regulations prescribe expiation fees of $4 000 for a body corporate and $500 for a natural person for an alleged civil-penalty contravention involving the code (reg 6(2)). The instrument does not set out the procedural mechanics for how expiation operates; those procedures are contained in the Act’s civil-penalty regime. The presence of fixed expiation amounts creates a summary “pay-and-go” option for alleged contraventions but does not itself preclude enforcement under the Act.

Mediation fees recoverable as Crown debt (reg 7(1)-(2))

• Recoverability: Where an authorised officer arranges mediation with the agreement of the parties, each party must pay $195 per day or part day (reg 7(1)). That fee is explicitly stated to be recoverable as a debt due to the Crown (reg 7(2)). That creates a statutory priority for recovery of the mediation fee and places the debt recovery power with the Crown’s recovery mechanisms.

Waiver power (reg 7(3))

• Discretion to waive: The Commissioner may waive a mediation fee if satisfied it is appropriate in a particular case (reg 7(3)). That discretion allows administrative relief from the fee but is not constrained by formula in the instrument.

Administrative enforcement via the Commissioner and authorised officers (reg 5(2); Schedule 1, cl 4)

• Administrative tools: The Commissioner is given responsibility for administering the code and Part 3A in relation to it (reg 5(2)). Authorised officers may commence ADR, require participation, compel compliance with reasonable requests (which can include production of documents and answering questions), appoint experts, allocate expert costs, suspend or terminate ADR when overlapping proceedings exist, and issue a certificate on completion (Schedule 1, cl 4). Those powers are the principal operational enforcement instruments.

Use of certificates in court (Schedule 1, cl 4(11)-(13))

• Evidentiary effect: After completion of ADR the authorised officer must provide a certificate containing the names of the parties, nature of the matters, whether the procedure was terminated without resolution, and terms of any resolution (Schedule 1, cl 4(11)). While communications in ADR are confidential by default (Schedule 1, cl 4(12)), the code explicitly permits production of that certificate before a court or tribunal (Schedule 1, cl 4(13)). That creates a mechanism for converting an ADR outcome or non‑outcome into admissible material in judicial or tribunal proceedings.

Limitations and dependencies

• The regulations do not themselves authorise criminal sanctions, nor do they alter the internal procedural mechanisms for civil penalty proceedings which are governed by the Act. The instrument depends on the Act’s enforcement framework for civil penalties (reg 6(1)). The instrument also relies on the Commissioner’s and authorised officers’ exercise of discretion for much of its operational effect, including commencement of ADR, assessment of whether a party has made a reasonable attempt to resolve the dispute, whether the subject matter is frivolous or vexatious, appointment of experts, and waiver of fees (Schedule 1, cl 4(1), (7), reg 7(3)).

Practical enforcement consequences for participants

• Non-compliance with an authorised officer’s reasonable request or failure to attend/participate once ADR is commenced is a breach of the code and, if constituted as a contravention of s 28E of the Act, exposes the contravenor to civil-penalty proceedings under the Act (Schedule 1, cl 4(2)-(4); reg 6(1)). Parties who undertake court or arbitration proceedings risk suspension of the code process (Schedule 1, cl 4(9)), and parties should note that the certificate issued at the end of ADR can be used in later proceedings (Schedule 1, cl 4(11)-(13)).

In summary, enforcement is a mix of administrative compulsion to participate and produce, economic levers in the form of recoverable mediation fees and shared expert costs, and the overlay of civil-penalty exposure via the Fair Trading Act’s Part 7 Division 3A mechanisms. The Commissioner’s discretionary powers are central to whom and how enforcement occurs.

The instrument is expressly structured to operate within and alongside other legal frameworks. The regulations cross‑reference the Fair Trading Act 1987, the Building and Construction Industry Security of Payment Act 2009, and provide express rules for concurrency with court, tribunal and arbitration processes.

Interaction with the Fair Trading Act 1987 (reg 3; reg 5(1); reg 6(1))

• Foundational link: The regulations are made under the Fair Trading Act 1987 and expressly operate within Part 3A of that Act (reg 5(1)). The code is an industry code for the purposes of Part 3A (reg 5(1)). Contraventions of the code that amount to breaches of section 28E of the Act are to be treated as civil-penalty contraventions under Part 7 Division 3A of the Act (reg 6(1)). Thus the instrument does not replace the Act’s enforcement regime; it triggers it.

Cross-reference to Security of Payment Act terminology (reg 3)

• Definitions link: The definitions for "construction contract", "construction work" and "related goods and services" are those in the Building and Construction Industry Security of Payment Act 2009 (reg 3). That cross-reference aligns the scope of disputes captured by the code with the established statutory definitions used in security‑of‑payment law, tying the code’s scope to existing contractual and statutory boundaries.

Interaction with arbitration and other ADR (Schedule 1, cl 2; cl 4(9))

• Exclusion of arbitration: The code defines alternative dispute resolution procedure to exclude arbitration (Schedule 1, cl 2). That establishes a legal boundary in favour of non‑arbitral ADR forms under the Commissioner’s ADR powers.
• Concurrency rules: The authorised officer must suspend or terminate ADR if the dispute is the subject of proceedings before a court or tribunal, arbitration, or another ADR procedure (Schedule 1, cl 4(9)). That rule creates a standard primacy of external adjudicative processes over the code’s ADR in cases of overlap.

Admissibility and evidence (Schedule 1, cl 4(11)-(13))

• Confidentiality and admissibility balance: The code makes communications and documents prepared for ADR confidential by default (Schedule 1, cl 4(12)). However, it provides that the certificate the authorised officer issues on completion is admissible before a court or tribunal (Schedule 1, cl 4(13)). This makes the certificate a specific legal bridge between the code’s administrative ADR and formal court/tribunal processes. Practitioners should treat the certificate as a permitted disclosure point.

Recovery of debts to the Crown (reg 7(2))

• Financial enforcement: The mediation fee is recoverable as a debt due to the Crown (reg 7(2)). That places recovery within Crown debt recovery mechanisms rather than private contractual recovery, and interacts with broader public-debt collection and Crown law mechanisms.

Interaction with contractually agreed dispute resolution pathways

• The instrument does not alter the enforceability of private dispute-resolution clauses directly, but its concurrency rule means that if parties commence court, tribunal or arbitration proceedings, the authorised officer may suspend ADR (Schedule 1, cl 4(9)). The code explicitly excludes arbitration from its ADR definition (Schedule 1, cl 2), which preserves the distinct legal space of arbitration.

Dependencies on definitions external to the instrument

• Several key terms are defined by reference: the Act (reg 3), and the Security of Payment Act for construction-contract related terms (reg 3). Also, "authorised officer" is not defined within these regulations or the Schedule. Consequently, to understand the full scope of powers and limits one must consult the Fair Trading Act 1987 and any appointments or instruments that define authorised officers under that Act or related administrative instruments.

Operational overlap risks

• Parallel proceedings: Because the authorised officer can suspend ADR when a dispute is the subject of court, tribunal or arbitration proceedings (Schedule 1, cl 4(9)), parties who start external proceedings may interrupt the code pathway. Conversely, parties engaging in the code’s ADR should be aware that the resulting certificate can be used in subsequent court or tribunal processes (Schedule 1, cl 4(11)-(13)).

In sum, the instrument is tightly integrated with the Fair Trading Act’s Part 3A and civil-penalty machinery, adopts Security of Payment Act terminology for construction-contract concepts, preserves arbitration as a distinct route and provides explicit rules for suspension where external adjudication is underway. Practitioners must read the code in tandem with the Fair Trading Act and the Security of Payment Act to understand full operative effect.

The instrument records a concise legislative history in the text provided.

• Principal regulations: The Fair Trading (Building and Construction Industry Dispute Resolution Code) Regulations 2017 are recorded in the Legislative history as 2017 No 318 (Gazette 5.12.2017 p4852) (Legislative history). The commencement clause states the regulations come into operation on the day on which they are made (reg 2). The Gazette reference and commencement date in the Legislative history and reg 2 indicate that the instrument commenced on 5 December 2017 (Legislative history; reg 2).

• No amendments recorded in the instrument: The schedule labelled "Legislative history" lists only the principal regulations (2017 No 318). There are no subsequent amendment entries, repeal entries or other notes included in the copy provided. Therefore, within the text provided, there have been no recorded regulations-amending entries or subsequent instrument notes.

• Stability of the instrument’s core provisions: Because the text provided contains only the original principal regulation entry and no later amendment entries, the provisions as printed (definitions, prescription of the code, civil-penalty linking, mediation and expiation fees, and the full text of the Building and Construction Industry Dispute Resolution Code in Schedule 1) reflect the original 2017 instrument as enacted.

Practical implication for users

• Users should treat the version supplied as the enacted 2017 regulation and code. However, the instrument does not itself record any later amendments or revocations. For an up‑to‑date view, practitioners would ordinarily check the current consolidated legislation database or Gazette. The instrument as provided records the principal regulation details and commencement but no later amendment history entries.

This is the full legislative history content contained in the instrument provided.

The regulation text and Schedule do not include any litigation history, case citations or adjudicative materials. The instrument itself is a subordinate legislative instrument and contains no references to decisions or judicial interpretation.

What the instrument records about interactions with courts and tribunals (Schedule 1, cl 4(9)-(13))

• Although there is no litigation history recorded, the code contemplates interaction with courts and tribunals. An authorised officer may suspend or terminate ADR if the dispute is the subject of proceedings before a court or tribunal, arbitration, or another ADR procedure (Schedule 1, cl 4(9)). The code also provides that a certificate issued at the end of ADR may be produced before a court or tribunal (Schedule 1, cl 4(11)-(13)). Those provisions demonstrate an expectation that judicial and tribunal decisionmakers will see materials created under the code, but no case law or litigation outcomes are cited in the instrument.

No cases named or referenced

• The regulation text gives no details of court judgments, tribunal determinations, or appeals concerning the code or the regulations. It does not purport to summarise judicial treatment of the code or its provisions.

Implications for practitioners

• Because the instrument contains no litigation history, practitioners cannot rely on judicial interpretation within the text itself to resolve ambiguities that may arise in application, such as what constitutes a "reasonable attempt" to resolve a dispute (Schedule 1, cl 4(1)) or the scope of an authorised officer’s "reasonable request" (Schedule 1, cl 4(4)). Those questions would require reference to subsequent judicial or tribunal decisions, administrative guidance from the Commissioner’s office, or the relevant provisions of the Fair Trading Act if contested in court.

Evidence-access pathway (Schedule 1, cl 4(11)-(13))

• The code creates a limited evidentiary pathway by which a certificate resulting from ADR can be produced in court or tribunal proceedings (Schedule 1, cl 4(11)-(13)), but the instrument does not provide case law on how courts have treated such certificates, whether they are given probative weight beyond recording procedural matters, or whether further hearsay, admissibility or confidentiality questions have been litigated.

For the purposes of this instrument, therefore, there is no litigation history contained within the text. Any precedential or interpretive authority must be sought outside the instrument by checking court or tribunal databases and the Commissioner’s administrative publications.

The instrument contains several provisions where the stated operation may produce practical surprises for participants and advisers. These points are grounded in the text and focus on legal and operational frictions created by definitions, discretions and procedural default positions.

1. Broad scope of "participant" (reg 4(b); Schedule 1, cl 3)

• Gotcha: The term "participant" is broad and includes suppliers and businesses "having a connection" to the industry and suppliers of goods or services "in connection with the carrying on of a business" in the industry (reg 4(b)(i)(B)-(C)). A supplier who provides goods to a construction company may be captured even if not directly performing construction work. Practitioners should not assume the code only applies to contractors doing building work.

2. Alternative dispute resolution explicitly excludes arbitration (Schedule 1, cl 2)

• Gotcha: The definition in Schedule 1, cl 2 says "alternative dispute resolution procedure does not include arbitration". An authorised officer cannot commence arbitration under the code, and parties cannot be forced under the code into arbitration. If parties have existing contractual arbitration clauses, the code’s concurrency rule permits suspension where arbitration is under way (Schedule 1, cl 4(9)), but the exclusion means arbitration is outside this administrative ADR tool.

3. Mandatory attendance and compliance with "reasonable requests" subject to an undefined authorised officer role (Schedule 1, cl 4(2)-(6))

• Gotcha: Once ADR is commenced, parties must attend and comply with reasonable requests, including production of information and answering questions (Schedule 1, cl 4(2)-(4)). The instrument does not define "authorised officer" or "reasonable request" within its text. The absence of a statutory definition in the instrument means the scope of compellability is administratively determined and may be contested in practice.

4. Short compliance windows: 14-day rule for written requests (Schedule 1, cl 4(6))

• Gotcha: Written requests by an authorised officer must be complied with within 14 days unless the authorised officer allows longer (Schedule 1, cl 4(6)). This imposes a relatively short default window for document production or answers, which can be operationally difficult for parties who require time to assemble records or seek legal advice.

5. Expert costs equally apportioned by default (Schedule 1, cl 4(7)-(8))

• Gotcha: If the authorised officer appoints an expert after consultation, parties are equally liable for the expert’s costs unless they agree otherwise (Schedule 1, cl 4(8)). A party with stronger financial resources may prefer expert appointment; absent prior agreement that allocation should follow fault or other considerations, cost splitting is the default.

6. Confidentiality with a narrow exception: the certificate is admissible (Schedule 1, cl 4(12)-(13))

• Gotcha: ADR communications and documents are confidential unless otherwise agreed (Schedule 1, cl 4(12)). However, the authorised officer’s certificate may be produced in court or tribunal proceedings (Schedule 1, cl 4(13)). That means the practical confidentiality of the ADR may be limited by the formal certificate, which records whether resolution occurred and terms of any resolution (Schedule 1, cl 4(11)). Parties should carefully consider what is included in settlement terms and whether they want those terms recorded in a certificate that may be produced in future proceedings.

7. Mediation fee is recoverable as a debt due to the Crown and waiver is discretionary (reg 7(1)-(3))

• Gotcha: Parties must each pay $195 per day, recoverable as a debt to the Crown if unpaid (reg 7(1)-(2)). The Commissioner may waive the fee in a particular case (reg 7(3)), but waiver is discretionary and not guaranteed. Parties should budget for the fee or seek a waiver in advance.

8. Civil-penalty exposure under the Fair Trading Act for code breaches (reg 6(1)-(2))

• Gotcha: Contravention of the code that constitutes a contravention of s 28E of the Act is subject to civil-penalty treatment under the Act (reg 6(1)). The instrument fixes expiation amounts ($4 000 corporate, $500 natural person) (reg 6(2)), which can be an immediate charge and could have reputational or financial effects.

9. Suspension where external proceedings exist (Schedule 1, cl 4(9))

• Gotcha: If a party starts court, tribunal or arbitration proceedings, the authorised officer may suspend or terminate the ADR (Schedule 1, cl 4(9)). Parties trying to preserve the code pathway should consider the timing of external litigation.

10. Undefined concept of "reasonable attempt to resolve" before Commissioner will commence ADR (Schedule 1, cl 4(1))

• Gotcha: The authorised officer will only commence ADR if satisfied the applicant has made a "reasonable attempt to resolve the dispute" and the subject matter is not frivolous or vexatious (Schedule 1, cl 4(1)). The code does not define what counts as a reasonable attempt. This leaves scope for administrative discretion and potential disagreement about admissibility of an application.

11. No internal definition of "authorised officer" in the instrument

• Gotcha: The instrument frequently relies on actions by an "authorised officer" but does not define who that is, or how they are appointed or authorised, within the regulation or Schedule. The identity and remit of authorised officers may be set out in the Act or administrative instruments, but the absence here means parties must verify appointment and powers administratively.

These are practical pitfalls that can materially affect strategy. They derive from the code’s definitions, discretion points, financial defaults and confidentiality carve-outs.

This section sets out concrete, source-grounded steps and considerations for businesses and advisers who want to comply with the code and the regulations. Each step references the relevant provision.

1. Confirm whether the code applies to you (reg 4; Schedule 1, cl 3)

• Check participant status: Determine whether your business is a participant as defined. The code applies to persons carrying on a business in the building and construction industry, businesses that have a connection to it, suppliers of goods or services supplied in connection with carrying on such a business, and persons who have undertaken to carry out construction work or to supply related goods and services under a construction contract (reg 4(b)(i)-(ii); Schedule 1, cl 3(a)-(b)). Note the definitions of construction contract, construction work and related goods and services adopt the definitions in the Building and Construction Industry Security of Payment Act 2009 (reg 3). If your activity falls within those definitions, plan on compliance obligations.

2. Make a reasonable attempt to resolve the dispute before applying (Schedule 1, cl 4(1))

• Evidence of attempt: The Commissioner will only commence ADR if satisfied the applicant has made a reasonable attempt to resolve the dispute and the subject matter is not frivolous or vexatious (Schedule 1, cl 4(1)). While "reasonable attempt" is not defined, preserve contemporaneous records of negotiations, correspondence, dispute notices, and offers. That documentary history will be the basis for the Commissioner’s assessment.

3. Apply in writing if seeking ADR (Schedule 1, cl 4(1))

• Written application: Lodge a written application to the Commissioner asking an authorised officer to commence ADR. Ensure your application includes evidence of the reasonable attempt to resolve and succinctly summarises the dispute, the contractual or supply background and the relief sought.

4. Prepare to attend and participate (Schedule 1, cl 4(2)-(4))

• Attendance and representation: Once ADR is commenced the authorised officer can require a party or an authorised representative to attend or otherwise participate (Schedule 1, cl 4(2)). Appoint an authorised representative in writing if you do not plan to attend personally. Ensure any representative has authority to answer questions and, if requested under cl 4(5), is authorised to resolve the dispute.
• Behavioural obligations: Train participants and representatives to "act reasonably, fairly, honestly and cooperatively" and to avoid misleading, harassing, intimidating or oppressing other parties (Schedule 1, cl 4(3)).
• Information requests: Be ready to supply information and documents, answer questions and attend meetings as reasonable requests from the authorised officer (Schedule 1, cl 4(4)). For written requests, prepare to respond within 14 days unless you obtain an extension from the authorised officer (Schedule 1, cl 4(6)).

5. Budget for costs: mediation fee and potential expert costs (reg 7(1); Schedule 1, cl 4(7)-(8))

• Mediation fee: If mediation is arranged by an authorised officer with your agreement, budget $195 per party per day or part day for mediation (reg 7(1)). The mediation fee is recoverable as a debt due to the Crown (reg 7(2)). If cost is a concern, consider asking the Commissioner for a waiver in advance and provide grounds for why a waiver is appropriate (reg 7(3)).
• Expert costs: If the authorised officer appoints an expert after consultation, plan to share their costs equally with the other party unless you negotiate a different apportionment in writing (Schedule 1, cl 4(7)-(8)).

6. Consider the confidentiality implications of the certificate (Schedule 1, cl 4(11)-(13))

• Settlement terms and confidentiality: Communications in ADR are confidential unless the authorised officer and parties otherwise agree (Schedule 1, cl 4(12)). However, the authorised officer will issue a certificate noting whether the dispute was resolved and the terms of resolution, and that certificate may be produced in court or tribunal proceedings (Schedule 1, cl 4(11)-(13)). If settlement terms are commercially sensitive, negotiate how they will be recorded in the certificate or consider using separate confidentiality agreements to protect commercial details while complying with the code’s certificate requirement.

7. Be cautious about commencing court, tribunal or arbitration proceedings (Schedule 1, cl 4(9))

• Impact of external proceedings: If you commence external proceedings, an authorised officer may suspend or terminate the code’s ADR (Schedule 1, cl 4(9)). Consider the strategic implications of starting litigation before or during ADR. Conversely, if the other party starts proceedings you can notify the Commissioner to ask whether ADR will continue or be suspended.

8. Avoid conduct that could be a contravention of the code and attract civil penalties (Schedule 1, cl 4(2)-(4); reg 6(1)-(2))

• Compliance with participation and disclosure obligations is not merely procedural. A contravention of the code that constitutes a breach of section 28E of the Fair Trading Act will attract civil-penalty treatment under Part 7 Division 3A of the Act (reg 6(1)). Expiation fees are $4 000 for bodies corporate and $500 for natural persons for alleged contraventions (reg 6(2)). Ensure staff and representatives are aware of these legal obligations.

9. If you disagree with a request from an authorised officer, seek clarification and record it in writing (Schedule 1, cl 4(4)-(6))

• Managing scope and reasonableness: The code requires compliance with "reasonable requests". If a request is overly broad or raises privilege issues, seek clarification from the authorised officer in writing, state your concerns, and propose an alternative timetable consistent with the "as soon as reasonably practicable" standard and the 14-day written-request default (Schedule 1, cl 4(4)-(6)). Maintain contemporaneous records to demonstrate responsiveness if the issue escalates.

10. Preserve commercial options while engaging the code

• Use the certificate for leverage: The authorised officer must provide a certificate at the end of ADR recording the terms of any resolution (Schedule 1, cl 4(11)). Consider negotiating the terms and their recording in the certificate, and remember that the certificate may be used in later court or tribunal proceedings (Schedule 1, cl 4(13)). If resolution is achieved, ensure settlement terms are recorded in a way that achieves commercial goals and protects confidentiality where possible.

11. Check the definitions and linked Acts

• Definitions check: Confirm how "construction contract", "construction work" and "related goods and services" are defined in the Building and Construction Industry Security of Payment Act 2009 because the code adopts those meanings (reg 3). Also check the Fair Trading Act 1987 for the mechanics of civil-penalty enforcement under Part 7 Division 3A.

12. Understand who the authorised officers are in practice

• Administrative step: The instrument does not define "authorised officer" within its text. Seek the Commissioner’s administrative guidance or statutory instruments that locate or appoint authorised officers so you know who will conduct ADR and what powers they have in practice (Schedule 1, cl 4).

Following these steps will align behaviour with the code’s procedural and financial requirements, preserve legal options, and reduce the risk of contravening the code or triggering civil-penalty enforcement. The focus should be on early documentation of settlement attempts, timely compliance with authorised‑officer requests, sensible cost planning, and careful management of confidentiality and future litigation risk.