On November 27, the Construction Prompt Payment Act received Royal Assent and was officially enacted as law.
This milestone brings B.C.’s construction industry one step closer to a standardized payment system – keeping cash flowing, crews working, and projects moving forward.
But what will it mean for contractors on the ground and what happens next?
Key Takeaways
Now that the Act has passed through the House and received Royal Assent, we know that the following key provisions will form part of its legal framework:
Regular and Proper Invoicing
1. Contractors will be required to submit a proper invoice to owners on a monthly basis unless otherwise specified in the contract, e.g. milestone-based invoicing (s.5).
2. Proper invoices must include the information specified in s.7(1)(a) and will be deemed proper unless the owner objects, in writing, within 7 days after the invoice date (s.7).
Prompt Payment
1. Owners must pay contractors within 28 days after the invoice date (s.9)(1)(a)).
2. Contractors must pay subcontractors within 7 days after they receive payment from the owner or before the subcontractor’s payment due date – whichever comes first (s.9).
3. Notices of non-payment from owners to contractors must be given within 14 days after the invoice date (s.11(2)(b)(i)).
4. Notices of non-payment from contractors to subcontractors must be given within 7 days after the contractor receives a notice of non-payment from the owner or before the subcontractor’s payment due date – whichever comes first (s.11(2)(b)(ii)).
5. If a contractor receives partial payment more than 7 days before the subcontractor’s payment due date, the contractor must pay the subcontractor rateably from the amount of the partial payment and within 7 days after they receive it (s.10).
6. Interest will begin to accrue on unpaid amounts after the payment due date at the rate specified in the contract or the prescribed rate – whichever is higher (s.15).
Adjudication
1. Notices of adjudication regarding owner-contractor contracts must be given within 90 days after a contract is completed, abandoned, or terminated (s.19(2)).
2. An adjudicator must be appointed by the adjudication authority within 7 days after a request is made by one or more of the parties (s.23)(2)).
What’s Next?
Currently the Act exists as a legislative framework – it needs to be fleshed out before it can begin being implemented and enforced.
In this next phase, the regulatory phase, the Ministry of Attorney General will work closely with industry stakeholders to develop the regulations needed to implement the law. This phase is expected to last between 12 and 18 months.
“MCABC was the first organization in B.C. to call for this reform over a decade ago,” says CEO Kim Barbero.
“Commitment and collaboration are what have gotten us to this point, and we look forward to partnering with government and other stakeholders on development of the regulations which, I expect, will further strengthen the mechanical contracting industry.”
As the regulatory process takes shape, we’ll be sharing updates and member-focused guidance so you know what to expect and how to prepare for the changes ahead.
Watch this space!
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Read the Act in Full: https://www.bclaws.gov.bc.ca/civix/document/id/lc/billscurrent/1st43rd:gov20-3
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About
The Mechanical Contractors Association of B.C. (MCABC) is the dedicated representative of the mechanical contracting industry in British Columbia – the industry with the largest share of skilled trades workers in the construction sector. As the connection to industry excellence for our diverse membership, we deliver education and professional development programs that enable high standards of practice and business success. Through advocacy and strong industry partnerships, we influence policy and regulatory development at all levels of government, advancing the interests of our industry and improving its ability to meet B.C.’s growing infrastructure demand.
Media Contact
Conor Brendan Dunne
Manager, Communications & Stakeholder Engagement
cdunne@mcabc.org
(604) 205-5058
