Adjudication in Malaysia – now effective

The Construction Industry Payment and Adjudication Act (CIPAA) 2012 became effective on the 15 April 2014. This means that adjudication and payment registration is now effective in Malaysia in a similar way to other countries around the world such as England, Wales and Scotland, New Zealand, Australia and Singapore.

CIPAA was passed on 18 June 2012 and then issued in the Gazette on the 22 June 2012. It has therefore taken a while before it was brought into force. It will now be interesting to see how it is used in practice in the Malaysian construction industry. No doubt some will welcome the act whilst others will be concerned about its impact on their practice. Payment legislation and adjudication has now been used for many years in different countries around the world, but it will still be interesting to see the impact on Malaysia and in particular how the courts interpret the provisions. The real question is whether the Malaysian courts will enforce promptly the payment of adjudicator’s decisions. Only time will tell.

Click here to read more information about the Malaysia Act which Nicholas Gould first commented about in our newsletter International Quarterly.