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Legal Developments to the Industrial Sector in 2025



As we navigate 2025, the industrial sector is facing a wave of regulatory changes that could reshape compliance, operations and risk management. In July 2020, Queensland parliament passed the Building Industry Fairness (Security of Payment) Act 2017 (QLD) (SOPA), which adopted a number of recommendations from the building Industry Fairness Reforms Implementation and Evaluation Panel, requiring head Contractors to open a trust-style bank account when withholding retention under contracts in Queensland.


Key Update: Delays to Queensland’s Project Trust Regime

Despite passing SOPA in 2020, the full rollout of the regime has been delayed indefinitely. Designed to improve financial security in construction projects, the SOPA requires project trust accounts be established for eligible contracts, ensuring transparent payment processes.


Currently, SOPA requires a trust account to be established for:

  1. State government, hospital, and health service contracts of $1 million or more (Phase 1); or

  2. Local government and private sector projects of $10 million or more (Phase 2).


The now-delayed expansion was set to include Phase 3 and Phase 4, which included trust accounts for:


  1. Local government and private sector projects of $3 million or more (Phase 3); and

  2. Contracts of $1 million or more across public and private sectors (Phase 4).


The Queensland Government indicated that the decision to pause Phase 3 and Phase 4 will allow the Queensland construction industry (particularly smaller contractors) more time to prepare for the changes and additional compliance requirements


Implications you may face

If you primarily engage as Contractors and Subcontractors in your agreements, this pause does not affect contracts already subject to the trust account framework. There is no indication that the remaining phases will not proceed, making this an ideal time for you to fully understand the future regulatory requirements and prepare for the rollout of Phases 3 and 4.

 
 
 

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