New licence rules for building contractors are out

Regulations providing for the licensing of building contractors are in force from today, ensuring for the first time that all operations in the construction industry are regulated.

The legal notice out on Tuesday stipulates that existing contractors have until 31 October 2023 to apply for a licence. They will be allowed to continue working pending the approval of their licence.

Contractors applying from 1 November will have to wait for the provisional licence to be issued before they can operate.

Provisional licences will be issued for the first year but from 1 January 2025 all contractors would have to be fully licensed as per legislation.

The new rules apply to contractors offering services of demolition, excavation and construction and impose several obligations, including the requirement that any work done is covered by a valid insurance policy to cover any loss or damage to third parties and employees.

The legal notice could be published today after the government received clearance from the European Commission last Friday, following what is known as a proportionality test.

The regulations also establish a schedule of penalties for contractors working without a licence, or carrying out work with a suspended licence or in violation of licence conditions.

The penalties also contemplate prison sentences of up to six months and administrative penalties that can go up to €50,000 and fines that can reach €5,000 per day.

Planning Minister Stefan Zrinzo Azzopardi said the regulations were the first concrete attempt to introduce a licensing system in the construction sector after the 1880 law that introduced the mason’s licence.

“This is also the first time that excavation and demolition works will be regulated through a licensing regime,” he said on Tuesday. “The rapid evolution in the type of buildings that have been going up over the past decade or so has created new challenges that requires a mentality shift in the sector.”

The new rules mean that contractors will have to undergo specialised courses or demonstrate a track record of jobs carried out. But more importantly, the minister added, the licensing regime will ensure that the regulatory authorities have a list of contractors thus enabling them to better enforce laws.

Zrinzo Azzopardi said the enforcement capacity of the Building and Construction Authority will be beefed up to ensure contractors comply with the new rules.