Knowledge Highlights 28 July 2022
On 28 June 2022, the Building and Construction Authority (“BCA”) issued a circular on assessor’s determinations under Part 10A of the Covid-19 (Temporary Measures) Act 2020 (“COTMA”) for construction contracts in the built environment sector (“Circular”).
The Circular serves as a reminder to the built environment sector that the application period for an assessor’s determination under COTMA Part 10A will end on 31 August 2022.
Details of the Circular are set out below.
Application for assessor’s determination under COTMA Part 10A
The Circular encourages contractors to continue to negotiate amicable outcomes between parties. If contracting parties are unable to come to an agreement, contractors may apply for an assessor to seek a determination to adjust the contract sum for the increase in foreign manpower salary costs, in respect of Work Permit holders, due to Covid-19 for the period between 1 October 2020 and 30 June 2022. Contractors can apply for an assessor’s determination until
31 August 2022.
Public sector approach
Main contractors involved in eligible public sector construction contracts can request for further adjustment to their contract sum beyond any base adjustment, provided the necessary substantiation is submitted by 31 August 2022. Subcontractors likewise should negotiate with their main contractors for adjustment of contract sum with respect to COTMA Part 10A. More information on the negotiation process is set out in a BCA circular dated 27 October 2021 titled Clarifications on Public Sector Approach for COTMA Part 10A.
The Circular states that for avoidance of doubt, main contractors or subcontractors involved in public sector construction contracts may still apply for a Part 10A assessor’s determination if attempts to negotiate with the other party of the contract are unsuccessful.