January 01, 2021
Publication of New AIAC CIPAA Circulars
The AIAC is pleased to announce the publication of four (4) new circulars to assist in the AIAC’s exercise of its functions as the sole adjudication authority under the Construction Industry Payment and Adjudication Act 2012 (the “CIPAA”). The AIAC’s power to issue circulars relating to the CIPAA is enshrined in Section 32(d) of the CIPAA which deems that the AIAC is responsible for “any functions as may be required for the efficient conduct of adjudication under this Act”. A summary of the four (4) new circulars that will take effect from 1st January 2021 is below.
This circular supersedes AIAC CIPAA Circular 1A and reinforces the prospective application of the CIPAA as determined by the Federal Court in Jack-in Pile (M) Sdn Bhd v. Bauer (Malaysia) Sdn Bhd and Another Appeal  1 MLJ 174 and Ireka Engineering & Construction Sdn Bhd v. PWC Corporation Sdn Bhd and Other Appeals  1 MLJ 311. It reinforces the scope and application of CIPAA, as well as the AIAC’s position that payment disputes under the CIPAA that relate to contracts executed prior to 15th April 2014 will no longer be registered by the AIAC, save for in specified circumstances.
This circular supersedes AIAC CIPAA Circular 05 to reflect the repeal of the Goods and Services Tax Act 2014 in June 2018 and the enactment of the Services Tax Act 2018 in September 2018. It reflects the AIAC’s instructions to parties and to adjudicators on the manner for the collection of Sales and Service Tax (“SST”) in adjudication proceedings, particularly with respect to the adjudicator’s fee and the AIAC Administrative Fee.
This is a new circular which addresses the differing positions taken by the High Court on the calculation of “working days” under the CIPAA. The purpose of the circular is to clarify the AIAC’s position on the calculation of working days under the CIPAA, as well as to reinforce the necessity of parties providing proofs of service alongside their registration and appointment requests to the Director of the AIAC.
This is a new circular which introduces the AIAC’s Continuing Competency Development (“CCD”) scheme for adjudicators commencing on 1st January 2021. The CCD scheme complements the AIAC’s ongoing efforts to improve the quality and maintain expected competency standards of adjudicators empanelled with the AIAC, and is launched in furtherance to the AIAC Adjudicator Evaluation Form. The purpose of the CCD scheme is to equip adjudicators with the necessary know-how to confidently navigate through the various legal, technical, and procedural issues that may manifest in the course of an adjudication proceeding. In certain instances, the Director of the AIAC may give weightage to an adjudicator’s successful participation in the CCD scheme in determining the suitability and/or advancement of an adjudicator’s appointment(s) in proceedings. However, such consideration is not guaranteed.
The AIAC will be incorporating the abovementioned circulars, as well as the recently announced AIAC CIPAA Circular 07 and AIAC CIPAA Circular 08, in its latest publication of the AIAC CIPAA booklet, a copy of which will be made available on our website in due course.
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TAN SRI DATUK SURIYADI BIN HALIM OMAR