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Generative AI: A global guide to key IP considerations
Artificial intelligence (AI) raises many intellectual property (IP) issues.
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Australia | Publication | 五月 2020
Since project bank accounts (PBA) were introduced on a ‘trial basis’ in 2018 under the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (BIF Act), they have largely applied to Queensland Government building projects between $1 million and $10 million. However, it is the Queensland Government’s intention that the roll out of PBAs will apply to other organisations (both public and private sector) and a broader ambit of building contracts pursuant to the Building Industry Fairness (Security of Payment) and Other Legislation Amendment Bill 2020 (Qld) (BIF Amendment Bill).
It is proposed that from 1 July 2020 it will be mandatory for Hospital and Health Services’ (HHS) building projects to comply with the proposed project trust account regime (to replace the current PBA regime) under the BIF Act, as amended by the BIF Amendment Bill. While the proposed BIF Amendment Bill has not yet been passed by Parliament, and remains under review, it is worthwhile recapping the key features of the new regime as they are proposed to apply to HHSs and also identify some key issues to be considered in its application.
A project trust account will need to be established by a contractor engaged by a HHS where:
Unlike the current BIF Act and the application of PBAs, the BIF Amendment Bill broadens the concept of what work will be caught and which beneficiaries will benefit from establishing a project trust. Importantly:
Although maintenance services and building work services are not project trust work, a long term maintenance contract may be caught by the project trust regime where at least half of the contract price relates to other project trust work such as asset lifecycle renewal or capital works expenditure.
HHSs are not responsible for establishing and administering the project trust account, which is the obligation of the head contractor as the trustee. That said, head contractors face serious consequences if they do not comply with these and other project trust requirements, including fines, loss of QBCC licence, demerit points under the Queensland Government’s Ethical Supplier Mandate and jail.
However, as the principal under eligible head contracts, HHSs have a number of residual responsibilities, including:
The requirement to establish a project trust account substantively applies to new contracts entered into by the HHSs after 1 July 2020, however there is limited retrospective operation of the trust account requirements for existing contracts where there has been a variation to those contracts, including where the contract prices has increased by more than 30%.
The BIF Amendment Bill also includes a new regime for the establishment of a retention trust, which is a trust over retention amounts withheld from a contracted party. This will include retention monies withheld by a principal from a head contractor as well as retention amounts withheld by head contractors from first tier subcontractors. This broadens the current regime under the BIF Act in establishing a project bank account for retention monies.
Importantly, the need for a HHS, as the principal under a head contract, to establish a retention trust account is specifically exempted under the BIF Amendment Bill.
While the BIF Amendment Bill remains under review and has not been passed by the Parliament, it is broadly considered this will occur in due course. In the meantime, HHSs should carefully review compliance with the current BIF Act as well as the proposed BIF Amendment Bill. This might include:
The construction team at Norton Rose Fulbright will keep you informed of developments regarding the proposed project trust regime and other construction industry reforms. Should you wish to discuss how these developments will affect HHS procurements and projects, please contact us.
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