As the construction industry continues to grapple with the effects of the COVID-19 pandemic, contractors may find some respite in the latest round of amendments to the COVID-19 (Temporary Measures) Act (“COTMA”) passed by Parliament on 4 September 2020. Significantly, the COVID-19 (Temporary Measures) (Amendment No. 2) Bill (“Bill”) will align the operation of the COTMA with adjudication, the dispute resolution mechanism set up under the Building and Construction Industry Security of Payment Act (“SOP Act”) and commonly used in the construction industry.
In June 2020, amendments to the COTMA were proposed to provide relief from performance or breaches of construction or supply related contracts due to COVID 19 events. For instance, a tenant who is unable to move in because of the landlord’s inability to renovate or retrofit would be entitled to seek reliefs under the COTMA. As at the date of this update, the details of such reliefs are still being finalised.
This update sets out the salient features of the Bill where they relate to the construction industry, and briefly explains how they align with the SOP Act. For ease of reference, Sections of the COTMA highlighted in this update refer to Sections of the amended COTMA, as those new Sections introduced by the Bill will come into force in due course. We will, for illustrative purposes, also provide examples involving a hypothetical scenario concerning two parties to a construction or supply contract, where Party A is the party who is unable to perform an obligation due materially to a COVID-19 event, and Party B is the counterparty to the contract.
This update is accurate as of 25 September 2020.
If you would like information or assistance on the above or any other area of law, you may wish to contact the Partner at WongPartnership whom you normally work with or any of the following Partners:
Christopher CHUAH
Head – Infrastructure, Construction & Engineering
d +65 6416 8140
e christopher.chuah@wongpartnership.com
Click here to see Christopher’s CV.
Christopher CHUAH is a Senior Accredited Specialist in Building and Construction Law.
Candy Agnes SUTEDJA
Partner – Infrastructure, Construction & Engineering
d +65 6416 8273
e candy.sutedja@wongpartnership.com
Click here to see Candy’s CV.
Candy Agnes SUTEDJA is an Accredited Specialist in Building and Construction Law.