On December 9, 2023, the Federal Prompt Payment for
Construction Work Act, SC 2019, c 29, s 387 ("Act")
came into force. Pursuant to the Act, the Government of Canada must
pay all construction contractors within 28 days of invoicing.
Contractors, in turn, must pay sub-contractors within 7 days
thereafter.
All construction contracts of Canada existing prior to December
9, 2023 will not be subject to the Act until December 9, 2024.
The Act will apply in all provinces and territories where
reasonably similar legislation does not already exist. Ontario,
Saskatchewan and Alberta have enacted reasonably similar
legislation. Therefore, the Act will not apply in those
provinces.
The Act is the culmination of the effort of Canada's
construction industry and Members of the House of Commons and the
Senate that formally began in 2016.
