A key to achieving a fair and competitive marketplace is ensuring businesses comply with consumer laws. We continue to support businesses to be compliant by giving them information and resources and act quickly against businesses and organisations that are causing the most harm, to protect consumers before there is significant detriment.
Over the past year CAV continued to prioritise licensing, registration and compliance activities with a focus on rooming house safety and digital improvements to our systems. We prioritised rooming house safety checks to ensure compliance with the prescribed minimum safety standards, including secure doors and windows and up-to-date gas and electrical safety checks.
Licensing and registration transactions were made quicker and easier for businesses, professionals, and organisations. This was achieved by implementing several digital improvements to the BLA and CAV’s online licensing and registrations systems. Improvements included Automatic Mutual Recognition notifications, easier trust accounting notifications, and enabling rooming house operators to upload gas and electrical safety checks online.
Digital improvements to licensing and registration online systems
The Minister for Consumer Affairs, Gaming and Liquor Regulation issued the BLA and CAV with a new Statement of Expectations in September 2021. Significant changes included the addition of a key element to support economic and social recovery, as well as refreshed targets for the standing elements of timeliness, risk-based strategies and compliance related assistance. A crucial new target was to implement ongoing digital improvements to make licensing and registration interactions quicker and easier for businesses, professionals, and community groups.
In response, CAV implemented several digital improvements to its and the BLA’s online licensing and registrations systems, funded by the Victorian Government’s Regulation Reform Incentive Fund, with more planned for 2022–23. These digital improvements will make licensing and registration transactions quicker and easier for businesses, professionals and organisations.
In 2021–22, these improvements include online Automatic Mutual Recognition notifications, the inclusion of additional content in trust accounting notifications and the introduction of new functionality which enables rooming house operators to upload gas and electrical safety checks online. In 2021–22, 537 safety certificates were lodged. These can be more easily checked as part of CAV’s compliance monitoring activity to ensure residents are safe while saving operators time and giving them handy automated reminders when an updated certificate is due.
Through a joint project with Service Victoria, identification verification technology was integrated into the licensing and registration online portal myCAV. This has delivered a faster application process and reduced processing times for businesses and professionals.
The launch of the professional engineering registration scheme resulted in the extension of myCAV to facilitate registration applications. The single capture of data approach enables the Victorian Building Authority to manage registration endorsement and insurance requirements for building engineers through data sharing mechanisms.
Helping businesses through the COVID-19 pandemic
This year we supported regulated industries to manage the impacts of COVID-19 and their ability to meet compliance obligations, such as annual reporting and payment of licensing or registration fees. We worked with the BLA to provide fee waivers, refunds and deadline extensions for annual statements and trust account audit requirements to businesses and community organisations that sought assistance. The BLA provided 38 waivers and refunds totalling more than $6,700, in addition to 113 sex work licence fee refunds totalling more than $246,000. CAV gave 910 estate agents and conveyancers additional time to lodge their trust account annual audits. Extensions of time were also provided to more than 1,200 incorporated associations and co-operatives to hold annual general meetings and lodge annual statements.
Automatic mutual recognition
Automatic mutual recognition (AMR) enables individuals licensed or registered for an occupation in one Australian state or territory to work in another state or territory using their home state licence.
The AMR scheme commenced for several occupations in Victoria from 1 July 2021 and from 1 January 2022 for estate agents and professional engineers. Workers covered by AMR may be able to do the activities they are licensed for in their home state or in other states and territories without the need to apply and pay fees for a second licence. The scheme makes it easier for licensed or registered workers to operate in multiple states and territories while providing safeguards to maintain standards and protect consumers, workers and others.
We also extended our licensing and registration portal, myCAV, to allow estate agents and professional engineers to notify the BLA of their intention to operate under AMR in Victoria. This seamless process will deliver an increase in available qualified professionals and the faster delivery of services to Victorians, whilst ensuring all necessary public protection requirements, such as complying with Victorian trust account requirements, are met.
Professional engineers registration scheme
CAV led the implementation of the Professional Engineers Registration Act 2019, which for the first time introduced a registration scheme and conduct requirements for professional engineers in Victoria. This was a historic moment for the engineering profession in Victoria, and finally provided recognition of the vital role that engineers play in building our world and protecting our communities. The scheme also supports infrastructure delivery in Victoria and gives Victorians greater confidence by ensuring only suitably qualified and experienced engineers provide professional engineering services.
In a first for Victoria, the scheme is run under a co-regulatory model, where registration is jointly administered by the BLA, CAV, the Victorian Building Authority and the engineering profession. Under a progressive implementation model, professional engineers in five nominated areas – civil, structural, electrical, mechanical and fire safety – will be required to register unless they work under the direct supervision of a registered professional engineer or under a prescriptive standard.
The Act commenced on 1 July 2021 with existing registered building engineers, across all five areas, automatically transferred from the Victorian Building Authority to new registration with the BLA. The first area of engineering to be implemented in full was fire safety engineers, with registration becoming mandatory in December 2021. Implementation will conclude with mandatory registration for mechanical engineers in December 2023, although engineers can apply for registration at any time since the scheme commenced. In 2021–22, 4,571 engineers have been registered across the five areas of engineering.
Sex work decriminalisation
The Sex Work Decriminalisation Act 2022 was passed by the Victorian Parliament on 22 February 2022. Decriminalisation ensures that sex work is safe work. It maximises sex workers’ safety, health, and human rights and improves access to government health and justice services. It also reduces stigma and fear of criminal repercussions. Decriminalisation of sex work recognises that sex work is legitimate work and should be regulated through standard business laws, like all other industries in the state.
Stage One commenced on 10 May 2022. In addition to the decriminalisation of street‑based sex work in most locations, under Stage One, the Act repealed industry-specific advertising controls, the requirements for independent sex workers to register or be licensed by the BLA, and public health offences under the Sex Work Act 1994. The Act also included new anti-discrimination protections in the Equal Opportunity Act 2010. Stage Two of the reforms will come into force in December 2023 and repeal the Sex Work Act 1994. Upon the repeal of the requirements for independent sex workers (‘exempt small owner-operators’) to register, the BLA and CAV destroyed all records associated with the former small owner-operator register.
New educational requirements for prospective conveyancers and estate agents
New educational requirements for conveyancers were introduced in Victoria on 30 September 2021, following a national review of the existing qualification. The new qualification is the refreshed and updated Advanced Diploma of Conveyancing. The new qualification requires prospective conveyancers to complete nine core units and six electives. The changes to the regulations also changed the work experience requirements to be licensed, to recognise previous work as a licensed conveyancer. A person who has held a conveyancer’s licence within the last five years is now able to rely on that experience to be re-licensed, without having to undertake further supervised work experience.
DJCS sought stakeholder feedback on whether the proposed electives for the new qualification would give students the right skills they need to work as conveyancers. This feedback informed changes to the Conveyancers (Qualification and Experience) Regulations 2018 to implement the new qualification in Victoria.
Conveyancers who were already licensed were not affected by these changes.
We took various enforcement actions in 2021–22, with a particular focus on ensuring compliance with essential estate agent obligations.
For more information on actions completed or in progress as at 30 June 2022, see pages 16 – 18 of the Annual Report 2021-22 (PDF, 762KB).
Protecting consumers from underquoting and trust account losses
In 2021–22, CAV focused on compliance with essential estate agent obligations regarding trust accounting and underquoting. We issued 171 infringements and 226 Official Warnings to 200 estate agents regarding breaches in these areas.
Underquoting occurs when a property is advertised at a price below the estimated selling price, the seller’s asking price or a price that has been rejected as too low by the seller. When underquoting occurs, potential buyers can waste significant time and money inspecting and assessing properties that were never in their price range. It may also distort the market and create an artificial purchasing environment while enriching those who break the law.
Throughout the year, CAV monitored compliance with underquoting laws across the industry to protect homebuyers from underquoting. The pandemic contributed to unique conditions in the Victorian property market and raised concerns some agents were engaging in underquoting. We responded by making over 350 visits to estate agencies to ensure their compliance with underquoting laws.
We also continued to facilitate consumer and industry awareness, including website updates and social media posts to help agents understand the laws and to educate Victorians on how they can report suspected underquoting.
Trust accounts are a critical part of the consumer protection framework. They protect consumers who pay money (such as rent, purchase or sale deposits or advertising and maintenance fees) to real estate agents and conveyancers. Under the law, estate agents and conveyancers must deposit any client money they receive in advance into a trust account for safe keeping and face high penalties if they fail to comply.
In 2021–22 we finalised four criminal prosecutions against estate agents for trust account, underquoting and other conduct breaches. We also finalised a matter concerning the director of former western suburbs estate agency The Sarain Pty Ltd, Surinder Sarain, who agreed to an undertaking after admitting to breaches of Victoria’s Estate Agents Act 1980 and Estate Agents (Professional Conduct) Regulations 2008, including failing to disclose relevant information about the commission of two properties, making false and misleading representations whilst advertising properties and underquoting while marketing 11 properties. Additionally, Mr Sarain failed to maintain accurate trust accounting records. The matter was resolved out of court, with an undertaking provided to the Director of Consumer Affairs Victoria by Mr Sarain preventing him from working in any management position in the industry and a payment of $2,500 made to the Victorian Consumer Law Fund.
Completing and lodging a trust account annual audit is an essential consumer protection requirement. Estate agent and conveyancer trust account audits can be lodged electronically using our online portal myCAV. We continued our focus on ensuring compliance with these requirements in 2021–22 and will continue to take further enforcement action regarding non‑lodgement of audits where required.
Enforcing compliance with domestic building consumer protections
Building or renovating a house is one of the biggest investments many people will make in their lifetime. Victorian consumers seeking to engage in residential building works are provided with a number of legal protections, including domestic builder registration requirements and contractual regulations under the Domestic Building Contracts Act 2005 (the DBC Act).
The DBC Act prohibits building practitioners from demanding an excessive upfront deposit and regulates stage payments and cost escalation. Consumers who are pressured to pay too much
up-front are at risk of the builder not finishing the works on time or at all or not fixing defects. Consumers who unwittingly engage an unregistered building practitioner can also risk financial and workmanship problems; this is as well as not being afforded the same protections they would have had if engaging a registered building practitioner.
Mr Michael Johnson undertook outdoor building works across Melbourne as an unregistered builder, trading under several business names. Following a public warning notice issued about Mr Johnson in January 2021, CAV commenced court action against Mr Johnson in late 2021 for entering into a major domestic building contract without being a registered building practitioner and for receiving deposits greater than the amounts permitted under the DBC Act. We took action against Mr Johnson following complaints from consumers who had made payments for building work, which was then not supplied or completed, or was completed poorly and without the required building permit or registration.
In June 2022, Mr Johnson was convicted of breaches under the DBC Act and ordered to pay an aggregate fine of $7,000. He was also ordered to pay over $43,000 in compensation to affected consumers and to pay costs.
CAV will continue to respond to domestic building conduct that puts consumers at risk and unfairly damages confidence in the industry and registered builders doing the right thing.
Registers we administer
We administer the following registers:
- Estate agents
- Motor car traders
- Second-hand dealers and pawnbrokers
- Owners corporation managers
- Sex work service providers (licensees)
- Sex work brothel managers
- Rooming house operators
- Incorporated associations
- Patriotic funds
- Limited partnerships
- Retirement villages
- Funeral service providers
For more information see pages 12 of the Annual Report 2021-22 (PDF, 762KB).