Strata legislation reforms on commissions and conflicts of interest underway

The NSW government has recently announced plans to tighten laws on commissions received by strata managing agents and conflicts of interest in an attempt to strengthen regulation of the strata management industry and support confidence in investing and living in strata schemes.

These plans follow the ongoing investigation by the ABC about undisclosed insurance and other commissions.

Announced by the Minister for Fair Trading Anoulack Chanthivong, it was said that the latest changes would include “banning agents from receiving a commission on insurance products when they don’t play a role in finding the best deal for residents”.

Other aspects of the proposed reform include increasing the maximum penalties for agent’s obligations related to commission disclosure, strengthening disclosure requirements on any conflict of interest, and enhancing the enforcement powers of NSW Fair Trading.

Consultation on the proposed changes with the industry peak bodies including the Strata Community Association and Owners Corporation Network will start in the coming weeks, with the NSW parliament considering the changes later this year.

– Arvin Kong