The amendments have the following effects:

• harmonising the definitions of ‘builder’, ‘domestic building work’ and ‘major domestic building contract’ in the DBC Act;

• inserting a statutory prohibition in the DBC Act which was previously only contained in the Building Act, removing a ‘blind spot’ for owners and builders when it comes to understanding the statutory requirement regarding DBI; and

• clarifying the industry position that a builder may enter into an insurable MDBC without being covered by insurance, but must not demand or receive money from the owner under the contract until the domestic building work is covered by DBI.

The starting position under the Ministerial Order remains that a builder must not enter into an insurable MDBC unless the building work is covered by DBI, but allows this if the contract expressly provides a condition that:

• requires a compliant policy to be issued before the builder can enforce any provision of the contract; and

• requires a compliant policy to be issued before any domestic building work is carried out under the contract; and

• states that no money (including deposit money) is payable under the contract before that policy is issued; and

• requires the builder to ensure that a copy of the policy is provided to the owner within 7 days after it is issued.

The Victorian Building Authority (VBA) has the power to require production of information or documents to determine if s 43B of the DBC Act has been complied with, or where it has reasonable grounds to suspect that an offence has been committed under that section. The VBA may also seek an injunction from the court for a contravention of s 43B of the DBC Act.

The offence and penalty provisions under the Building Act have also been expanded, in that:

• if a person or company is found guilty of an offence against s 43B of the DBC Act, a court may, in addition to imposing any penalty for that offence, direct that the person or company is ineligible to apply for registration for not more than 3 years;

• if a builder (in a partnership) is found guilty of an offence against s 43B of the DBC Act, the offence may be extended to the partnership; and

• if a builder (that is a company) is found guilty of an offence against s 43B of the DBC Act, any person who is concerned in or takes part in the management of the company may be taken to have committed that offence.