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Dealing with Construction Permits in

Australia

Below is a detailed summary of the procedures, time and costs to build a warehouse in Australia. This includes obtaining necessary licenses and permits, completing required notifications and inspections and obtaining utility connections.

This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 190 economies. The most recent round of data collection was completed in June 2016. Read the methodology.

Compare Australia to 189 other economies.

  • Measure of efficiency
    No. Procedure Time to Complete Associated Costs
    1

    Verify if a development application is required

    Agency: Local Council

    It is the responsibility of the applicant to contact a planner at the nearest Council Location before preparing a Development Application (DA), to check:
    * whether the proposed development is permissible;
    * whether a DA is required; and
    * how the City's planning instruments - plans, codes and policies - affect the proposed development.

    BuildCo should ensure that the relevant planning controls have been identified and satisfied.

    There are a range of planning instruments that apply to various types of development and locations within Sydney.

    Most environmental and planning law in Australia varies from one Australian state to another. In Sydney, in the state of New South Wales, development will generally be assessed under one of the regimes in the Environmental Planning and Assessment Act 1979 (Planning Act).

    The warehouse to be constructed by BuildCo is most likely to fall under Part 4 of the Planning Act and will most likely require development consent from the relevant local council. The Planning Act provides that, for certain types of development, the concurrence of an authority other than the consent authority must be obtained. The conditions for approval of development assessed under Part 4 may also require the developer to obtain further certificates or approvals. These will add cost and time.

    The council's local environment plan (LEP) usually identifies whether development consent is required. The LEP categorizes development as requiring consent, not requiring consent, or prohibited. In most cases, the zoning of the site determines the types of development permitted on the land. Note that the construction of a warehouse is a type of development that almost always requires consent. If the development requires development consent, the local council will usually be the consent authority. However, in some cases, another authority (such as a State minister) may be the consent authority.

    1 day no charge
    2

    File development application with consent authority

    Agency: Local Council

    It is a legal requirement to submit digital copies of plans and supporting documentation.

    A minimum of six sets of drawings of the proposed development, plus one A4 set and a digital copy, should be submitted. These must include:
    • A site plan showing the location of the development within a building or within the locality. The site plan should also identify the site, streets, and adjoining properties, and include a north point.
    • Floor plans of the proposed buildings showing the layout, partitioning, room sizes and intended uses of each part of the building. Existing floor plans would also be useful.
    • Elevations and sections showing proposed external finishes and heights (not required where there is no new work proposed).
    • Drawings must be to scale, normally at 1:100.
    • Drawings are to be suitably numbered and dated.
    • Sign applications require plan and elevation details of the location, size and width of the sign, height above ground, materials, coloring, text including size of lettering, graphics and logo, and illumination. Council’s Signage and Advertising Structures DCP 2005 contains details of the requirements for the design and location of signs.
    • Drawings are to be folded to A4 size with the title block to the front.
    • Digital copies of plans and supporting documentation must be submitted with every application in Portable Document Format (PDF) files no more than 1 MB size.

    The consent authority reviews the environmental impact assessment for this proposed work and considers the following:
    • Relevant planning controls
    • Likely environmental impacts
    • Suitability of the site for development
    • Submissions received
    • Other prescribed matters
    • The public interest

    If the assessment is satisfactory, the consent authority will grant BuildCo development consent, which may be subject to conditions. The Development Application will be advertised for approximately 21 days to give the surrounding neighbors the opportunity to contest the planned development in that area. Once the advertising period is over, it will typically take 6 weeks for the development certificate to be issued.

    The fee for a Development Application is governed under the Environmental Planning and Assessment Regulation 2000.

    For a development with a cost over AUD 1,000,000 the Development Application fee will be calculated as follows:
    - Base fee = AUD 1,975
    -PlanFirst fee = AUD 640
    - Additional AUD 1.44 per AUD 1000.00 (or part thereof) by which the estimated cost exceeds AUD 1,000,000.00
    - Advertising fee = AUD 1,105

    60 days AUD 7,053
    3

    Apply for a construction certificate

    Agency: Sydney City Council

    After a Development Consent has been issued by the Local Council and before any building work is carried out, the owner must apply for a Construction Certificate. This certificate shows that the proposed development satisfies the Environmental Planning and Assessment Regulation 2000.

    This includes:
    • The construction plans and specifications must comply with the relevant standards (ie Building Code of Australia).
    • The construction plans and specifications are consistent with the development consent; and
    • All conditions of the development consent requiring compliance prior to the issuance of a construction certificate are finalized (i.e., payment of the long service levy has been made, the fire protection and structural capacity of the development is adequate, etc.).

    The Principal Certifying Authority (PCA) can be a Council or a private accredited building surveyor. If BuildCo chooses the Council as the PCA, an appointment form must be completed after the Construction Certificate is obtained. BuildCo must confirm with the PCA what work will be done, the fee, and any other requirements.

    When the City of Sydney is the PCA, the developer submits a Notice of Commencement of Work 2 days before work begins (Under Sections 81 A(2)(b)(i),(c), or (4)(b)(i),(c), 86(1)and (2) and 109E of the Environmental Planning and Assessment Act 1979).

    The PCA will also provide a list of mandatory inspections that need to be carried.

    Some councils may charge a standard fee for appointment as the PCA. Otherwise, the fee for obtaining a construction certificate for a development such as a new warehouse will vary by council, for example:

    For a warehouse with a construction cost above AUD 1,000,000.00, the Sydney City Council will charge:

    Fee = AUD 3,219 (including 10% of GST)
    Additional charge = AUD 1.43 for every AUD 1,000.00 for cost over AUD 1,000,000.00

    Additionally, some councils, such as the Hills Shire Council, offer combined fees for a development application and construction certificate, which can help streamline the process and potentially reduce time and cost.

    21 days AUD 5,936
    4

    Apply for approval of building/development plans by Sydney Water Quick Check Agent

    Agency: Sydney Water

    Before any construction work can be done, BuildCo must have the approved construction certificate plans assessed and stamped by a Sydney Water Quick Check Agent to verify that the proposed building work will not affect a Sydney Water asset (water supply pipe and/or drainage pipe).

    A copy of the stamped plans must be provided to the principal certifying authority before work commences.

    The documents that must be provided are:
    • A full set of building plans
    • A site plan to a recognized scale (e.g. 1:500) that shows the full site and the relationship of the proposed building works to the full site (the location on the lot where the building works will take place must be clearly identified)
    • A set of engineering plans detailing the foundations/footings of the proposed building works

    1 day AUD 18
    5

    Notify Sydney City Council of Commencement of work and appoint Sydney City Council as PCA

    Agency: Sydney City Council

    The builder will submit a “Notice of Commencement of Building or Subdivision Work” form and Appointment of Council as Principal Certifying Authority under Sections 81A(2)(b)(i),(c), or (4)(b)(i),(c), 86(1)and (2) and 109E of the Environmental Planning and Assessment Act 1979.

    This form is submitted only when the City of Sydney is retained as the Principal Certifying Authority (PCA).

    1 day no charge
    6

    Receive the commencement of building work inspection

    Agency: Sydney City Council

    Once a PCA is appointed, it is his responsibility to provide to the applicant a list of the mandatory critical stage inspections (in accordance to Clause 162A of the Environmental Planning and Assessment Regulation 2000) and any other inspections (determined by the PCA) that will be required during construction of the building. The builder needs to be aware of these inspections as they need to be carried out at the appropriate time. It is the responsibility of the builder to contact the PCA at least 48 hours before an inspection is required.

    Inspections during construction ensure that the construction is consistent with what has been approved in the development consent and construction certificate, and that the building will meet acceptable standards of health, safety and amenity.

    Mandatory critical stage inspections are set according to the building class. For the case study of Doing Business, the warehouse is a class 7 building.

    In the case of a class 5, 6, 7, 8 or 9 building, the building work on the development site must be inspected:
    • At the commencement of building work
    • Prior to covering any storm water drainage connections
    • After the building work has been completed and prior to any occupation certificate can be issued in relation to the building

    The cost of inspection when Sydney City Council is the PCA is AUD 309.00 per inspection including 10% GST. However, Doing Business does not include GST in its calculation.

    1 day AUD 281
    7

    Receive inspection prior to covering any stormwater drainage connections

    Agency: Sydney City Council

    A second mandatory inspection prior to covering any storm water drainage connections is conducted by the PCA to ensure compliance with the Construction Certificate.

    1 day AUD 281
    8

    Request and receive connection to water and sewage services

    Agency: Sydney Water

    To receive a connection to water and sewage services, BuildCo must first select a water-servicing coordinator. The coordinator requests a Section 73 Compliance Certificate (for water and sewerage infrastructure) from Sydney Water on BuildCo’s behalf. Sydney Water issues a notice of requirements to the coordinator within 10 days of application receipt (or longer if the development is complex). The notice specifies charges to be paid and the project to be built. If construction is required, certification will depend on the time required for the project to be built and taken over by Sydney Water. BuildCo pays the fees, builds the project, and receives the certificate.

    Fee schedule for water and sewage connection:
    • Water (including works): Up to AUD 1215.00
    • Sewage (assuming that infrastructure exists): AUD 132.00

    10 days AUD 1,347
    9

    Request the occupation certificate

    Agency: Sydney City Council

    The authority that has approved the development may monitor the finished development to ensure compliance with laws and local planning policies. If the development does not comply with the development consent, the applicant can be fined (with a penalty notice), ordered to make changes to the development, or taken to the Land and Environment Court of New South Wales. The court may issue orders to remedy or restrain breaches of the development consent (e.g. orders to carry out works, cease certain uses of the premises, or remove the development). In addition, breaches of planning laws may be criminal offences.

    New South Wales planning legislation allows any person to bring an action to remedy or restrain a breach of development consent. Thus, in theory, any person may commence proceedings to enforce compliance with the law (a) if a relevant approval (such as a development consent or construction certificate) has not been obtained where required; or (b) if there has been non-compliance with the conditions of a relevant approval.

    1 day no charge
    10

    Receive final inspection by PCA and obtain the final occupation certificate (OC)

    Agency: Sydney City Council

    An occupation certificate is issued by the appointed Principal Certifying Authority (PCA) under the Environmental Planning and Assessment Act 1979 allowing a building to be used and occupied.

    This certificate verifies that the PCA is satisfied that the building is suitable to be occupied and used according to the requirements of the Building Code of Australia (BCA). That Code sets required standards for the design and construction of various classes of building to protect health, safety and amenity.

    There are two types of occupation certificates:
    • A final occupation certificate allows commencement of either the occupation or use of a new building (including alterations or extensions), or the new use of an existing building resulting from a change of its use
    • An interim occupation certificate allows the commencement of either the occupation or use of partially completed building, or of a new use of part of an existing building resulting from a change of use for the building

    An occupation certificate is required for any new building work or change of use of a building that has a development consent or a complying development certificate under the EP&A Act.

    15 days AUD 281

  • Measure of quality
    Answer Score
    Building quality control index (0-15) 14.0
    Quality of building regulations index (0-2) 2.0
    How accessible are building laws and regulations in your economy? (0-1) Available online; Free of charge. 1.0
    Which requirements for obtaining a building permit are clearly specified in the building regulations or on any accessible website, brochure or pamphlet? (0-1) List of required documents; Fees to be paid; Required preapprovals. 1.0
    Quality control before construction index (0-1) 1.0
    Which third-party entities are required by law to verify that the building plans are in compliance with existing building regulations? (0-1) Licensed architect; Licensed engineer; Private firm. 1.0
    Quality control during construction index (0-3) 3.0
    What types of inspections (if any) are required by law to be carried out during construction? (0-2) Inspections by external engineer or firm; Inspections at various phases; Risk-based inspections. 2.0
    Do legally mandated inspections occur in practice during construction? (0-1) Mandatory inspections are always done in practice. 1.0
    Quality control after construction index (0-3) 3.0
    Is there a final inspection required by law to verify that the building was built in accordance with the approved plans and regulations? (0-2) Yes, external engineer submits report for final inspection. 2.0
    Do legally mandated final inspections occur in practice? (0-1) Final inspection always occurs in practice. 1.0
    Liability and insurance regimes index (0-2) 1.0
    Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1)  Architect or engineer; Construction company. 1.0
    Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) No party is required by law to obtain insurance . 0.0
    Professional certifications index (0-4) 4.0
    What are the qualification requirements for the professional responsible for verifying that the architectural plans or drawings are in compliance with existing building regulations? (0-2) Minimum number of years of experience; University degree in architecture or engineering; Being a registered architect or engineer; Passing a certification exam. 2.0
    What are the qualification requirements for the professional who supervises the construction on the ground? (0-2) Minimum number of years of experience; University degree in engineering, construction or construction management; Being a registered architect or engineer. 2.0