REALWorld Law


Licences and permits

What official permissions, licences or consents are required by a building or engineering contractor before it can start work?

United States

United States

Professional and other licensing and permit requirements vary widely from state to state in the US. Moreover:

  • additional licenses and permits are often required by regional, state, and local jurisdictions, and
  • a governmental agency in charge of a project could require additional qualifications in a request for proposal

This is a highly detailed and regulated area of law that not only depends on the jurisdiction, but on the nature of the project being undertaken (eg construction of a facility, engineering of public works), the entities involved (eg individual, corporation, partnership), and the type of work being performed.

As only a very broad and generic overview, examples of licenses and permits that an engineer or contractor may be required to obtain to carry out construction work include:

Engineering and architect licensing

Generally, an engineer or architect must possess a professional license to render services within the state where the project is located. In order to obtain the required license, the engineer or architect generally must attain a certain level of education, satisfy requirements for experience in the field, pass state-administered licensing examinations, and satisfy other requirements, such as residency, ethics and fee requirements.

General contractor licensing

Although not every state requires that a general contractor be licensed, several states have requirements that must be met. For example, a general contractor might be required to meet certain educational requirements, possess certain experience, and/or take and pass certain tests. This is critical because in some states unlicensed contractors are deemed to have forfeited any right to bring a legal action seeking payment for work performed and/or may be required to return all payments received for work on the project. However, even where such licensing is not required, a contractor likely will have to register to do business as a domestic or foreign corporation with the secretary of the state in which the project is located, obtain a tax identification number from the agency or agencies that collect state and municipal taxes, and procure a local business license.

Trade contractors

Trade contractors may have to be licensed or registered, obtain bonding, or register with certain authorities. These requirements are particularly relevant to mechanical electrical and plumbing (MEP) contractors, those handling asbestos or other hazardous materials, or trades that require the handling of explosives etc.

Licensing for US federal projects

The Federal Acquisition Regulations (FAR) serve as the primary regulations for US federal agencies acquiring services and supplies. FAR does not include any blanket federal authority that allows a contractor to perform work in a jurisdiction where it does not have a relevant authorization. According to FAR, the US federal government places the burden and expense upon contractors to obtain all necessary authorization to perform the work, including any authorization applicable in the state or other jurisdiction where the federal project is located.