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New WA construction bill targets phoenix builders

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The WA Government plans to introduce new legislation that will close a loophole allowing so-called phoenix builders to declare bankruptcy and start in the industry again under a new business name.

Builders with a history of ripping-off subcontractors will also be removed when the Building and Construction Industry (Security of Payment) Bill 2020 becomes law.

The WA Government says the legislation aims to create a fairer system for the state’s building and construction industry.

A mandatory retention trust scheme will be introduced when the bill becomes law. This will protect subcontractors' retention money from being misappropriated or lost altogether in insolvency at each level of the contracting chain.

“The building and construction industry is a vital part of our economy, ” WA Commerce Minister John Quigley said.

“The current reality is businesses need to always contend with the fear of not getting paid on time or at all, and without access to effective rights and protections under the law.”