The grace period for penalties under the new Property and Stock Agents Act regulations have been extended until 1 April 2021.
This is a six-month extension.
We want to ensure that all our members are across the extension and highlight what it means for those in the industry, and what penalties still apply.
The extension is in response to the economic impacts of COVID-19 on the property sector and was issued in good faith to vary NSW Fair Trading’s enforcement intentions for new regulatory obligations under the Property and Stock Agents Act 2002, which started on 23 March 2020.
Fair Trading will move to more active enforcement of compliance with the new regulatory obligations from 2 April 2021 onwards and revise its advice to the industry accordingly.
The new regulatory obligations on real estate and property agents that this statement addresses are found in the following laws and policies, which all commenced on 23 March 2020:
- Property, Stock and Business Agents Amendment (Property Industry Reform) Act 2018
- Property, Stock and Business Agents Amendment Regulation 2019
- Property and Stock Agents (Qualifications) Order 2019
- Schedule 2.12 of the Fair Trading Legislation Amendment (Reform) Act 2018
- Schedules 1.6, 1.8 and 1.9 of the Better Regulation Legislation Amendment Act 2019
- Secretary’s Supervision Guidelines issued under section 32 of the Act
- Secretary’s Continuing Professional Development requirements issued under section 20 of the Act
Some of the key changes for agents introduced by these laws and policies include:
- restrictions on the functions that can be performed by assistant agents, class 2
- licensees and class 1 licensees who are not nominated as a licensee in charge
- separate trust accounts to be maintained to hold rental and sales money
- new Continuing Professional Development (CPD) requirements
- comprehensive operational procedures to be maintained by the principal licensee.
During this time, Fair Trading’s compliance response will be not to penalise agents who have been identified as non-compliant with new regulatory obligations.
However, Fair Trading will expect non-compliant agents to be able to demonstrate that they have taken active steps towards full compliance within a reasonable time and to be compliant after the grace period expires (1 April 2021).
Possible Enforcement Actions:
For the duration of the grace period, Fair Trading retains the option to take active enforcement action against existing regulatory obligations that did not change on 23 March 2020.
This is especially important where non-compliance poses a higher risk of consumer detriment, including but not limited to:
- unlicensed trading (sections 8, 9 and 10 of the Act)
- fraud and false accounts of money received (sections 211 and 212 of the Act)
- misrepresentations generally (section 52 of the Act)
- underquoting (Part 5, Division 3 of the Act)
- failure to arrange for annual audit of the agency’s trust accounts (section 111 of Act)
- failure to hold professional indemnity insurance (section 22 of Act).
If you’d like more information, details of the real estate and property services industry reforms are available on the Fair Trading website at www.fairtrading.nsw.gov.au