OTTAWA — The federal government’s prompt payment regime was officially launched today (Dec. 12), enshrining new legal payment requirements for parties involved in federal projects.
Under the Federal Prompt Payment for Construction Work Act and its regulations, the federal government will have 28 calendar days to pay after a contractor submits a proper invoice. The contractor will then have seven days to pay its subcontractors and subcontractors will have another seven days to pay their sub-subcontractors.
The act was passed in June 2019 and regulations were posted in the Canada Gazette last February, stated a blog published by Osler. ADR Chambers Inc. has been appointed as the adjudicator authority and the training of adjudicators was to begin this fall.
There will be no grandfathering of older contracts and all existing construction contracts will have one year, as of Dec. 9, 2023, to comply with the Federal Prompt Payment for Construction Work Act.
Ontario, Saskatchewan and Alberta are the only provinces with fully implemented prompt payment regimes.
The Daily Commercial News will have more on this story.
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