The Property, Stock and Business Agents Act 2002 allows for licences and certificates of registration to be granted subject to certain conditions as set out in sections 20 to 23 of the Act.
Conditions on licences and certificates serve several purposes:
- Conditions can be imposed generally on all licenses or certificates to reinforce professionalism and ethical conduct in the property agency industry or to protect consumers. For example:
- the Act allows conditions to be imposed requiring licence holders to take out professional indemnity insurance and requiring licence and certificate holders to undertake continuing professional development each year
- real estate and stock and station agent licences are subject to the condition that the holder must not act as an auctioneer unless accredited as an auctioneer by the Secretary
- the Act also provides for conditions which apply to all on-site residential property manager licences to minimise consumer risks.
- Individual licences and certificates may be subject to specific conditions limiting the functions that can be exercised under the licence or certificate.
This type of condition may be imposed where the applicant will undertake a limited range of agency functions only, for example, where a real estate agent wishes to act only as a buyer’s agent.
- Individual licences and certificates may have specific conditions imposed on them following disciplinary action by the Secretary. This kind of condition could, for example, restrict a licence or certificate holder from exercising certain functions unless they do so under the supervision of an appropriately licensed person.
- A condition could also be imposed on an individual’s licence or certificate requiring the holder to undertake specified additional education or training in a particular aspect of agency practice.
Continuing professional development
Licences and certificates of registration issued on or after 1 September 2003 must complete continuing professional development in accordance with the Director General’s Guidelines within the following 12 month period.
Special conditions for on–site residential property managers
It is a condition of every on–site residential property manager’s licence that the holder may act only in respect of premises if:
- the licensee’s principal place of residence is situated at those premises, and
- the licensee owns or has an interest in that principal place of residence.
If an on–site residential property manager wishes to act in respect of other buildings, they will need to hold a real estate agent’s licence.
Conditions restricting the functions that can be exercised under a licence
The Act recognises that agents may wish to restrict the scope of their activities to a particular market niche, for example, buyers’ agents. Buyers’ agents act exclusively for purchasers in finding a suitable property and negotiating a sale on the best possible terms for the purchaser.
Buyers’ agents are required to hold a real estate agent’s licence, however, if they wish to act only as a buyer’s agent they can apply for a conditional real estate agent's licence that restricts them to carrying out those functions. Their licence will be annotated with this condition, which will reassure their clients that conflicts of interest between the roles of sellers’ and buyers’ agent will not arise.
Professional indemnity insurance
Licensees must hold professional indemnity insurance as a condition of their licence. Professional indemnity insurance provides protection to policyholders for claims made against them relating to acts or omissions committed in a professional capacity.
The Property Stock and Business Agents Amendment (Professional Indemnity Insurance) Regulation 2012 makes professional indemnity insurance mandatory from 1 January 2013. However, transitional arrangements mean that this requirement did not come into effect until 1 July 2013, allowing licensees who do not presently have any professional indemnity insurance coverage time to obtain suitable policy.
If a licensee is insured under an existing policy issued before 1 January 2013 the policy will be deemed to comply until it expires or until January 2014, whichever comes first.
The requirement for mandatory professional indemnity insurance applies to all licensees under the Property, Stock and Business Agents Act 2002 who engage in activities for which a licence is required. Those who do not conduct activities under their license, for example educators, trainers, unemployed licensees and licensees employed in other industries do not need to hold insurance.
View the Professional indemnity insurance information sheet (PDF, 149.51 KB) for more information, including details of transitional arrangements and insurance policy requirements.
In certain circumstances, you may have a right of internal review of a decision of a delegate of the Secretary with respect to the issue, renewal or restoration of licenses or certificates or the imposition of conditions. The result of the internal review and any decisions of the Secretary are reviewable by way of appeal to the NCAT.