Rewriting The Rules Of Payment In British Columbia Construction

On October 7, 2025, the BC government introduced Bill 20 – Construction Prompt Payment Act (Bill 20).¹ Bill 20 closely resembles Ontario's 2019 prompt payment legislation outlined here and features:

• Prompt payment requirements;
• Adjudication process; and
• Amendments to the Builders Lien Act.

Prompt payment

Bill 20 introduces new invoicing and payment requirements:

• A "proper invoice" must be submitted monthly unless the parties agree otherwise.²
• Owners are required to either pay a "proper invoice" within 28 days of the date of the invoice or issue a notice of non-payment within 14 days.³
• Contractors and subcontractors are required to pay their subcontractors within seven days of receipt of payment or by the "calculated payment date".⁴
• If a contractor intends to rely on the owner's non-payment of its own invoices to delay payment to its subcontractors, then the contractor must similarly provide any notice of non-payment it has received to its subcontractors.⁵
• If the amount that is the subject of a notice of non-payment is paid to the contractor, then the contractor must pay its subcontractor within seven days of receipt of payment or within the time calculated based on their position in the contractual chain.⁶

The timelines are purposely tight, intended to reduce payment delays down the contractual chain.

Adjudication process

Bill 20 introduces a fast-track adjudication system for resolving certain construction disputes, including those related to a notice of non-payment, failure to give a proper invoice and failure to make prompt payment.⁷

Adjudicators are required to issue a decision within 30 days after receipt of relevant records.⁸ If the adjudicator's decision requires one party to make a payment, then that payment must be made within 15 days of the decision.⁹

An adjudicator's decision is binding on the parties, meaning payment must be made, but it is not final. The parties are permitted to bring the dispute to court or arbitration.¹⁰

Amendments to the Builders Lien Act

Bill 20 proposes the following key amendments to the Builders Lien Act:

• Abolishment of Shimco liens – A lien against the holdback, commonly referred to as a "Shimco" lien, is a type of lien unique to BC, named after the court decision that first recognized its existence.¹¹ Bill 20 proposes abolishing the lien against the holdback.¹²
• Reduction of the holdback period from 55 to 46 days – This same reduction also applies to the holdback obligations of a purchaser of a strata lot from an owner developer.¹³ The reduction in the holdback period would allow the parties to release the holdback amount one day following the expiration of the lien claim period.¹⁴
• Addition of demolition work – Bill 20 proposes expanding the definition of "improvement" in the Builders Lien Act to expressly include demolition and removal work.¹⁵

What's next?

Having completed the First Reading, Bill 20 must now pass through few more stages before officially becoming a law, including a Second and Third Reading, and Royal Assent.¹⁶ There is opportunity for discussion and debate at each stage, and further regulations are expected. It will likely be at minimum several months before some form of Bill 20 officially becomes a law.

Bill 20 will only apply to contracts and subcontracts entered into after it is enacted.¹⁷ The parties may start preparing by familiarizing themselves with the requirements for proper invoices and timelines for prompt payment. Once enacted, Bill 20 will be an exciting reformative step for stakeholders in the construction industry.

Footnotes

1. Bill 20, Construction Prompt Payment Act, 1st Sess, 43rd Leg, British Columbia, 2025 (first reading 7 October 2025) [Bill 20].

2. Bill 20, cl 5.

3. Bill 20, cls 9, 11.

4. Bill 20, cl 9.

5. Bill 20, cl 11.

6. Bill 20, cl 11.

7. Bill 20, cl 16.

8. Bill 20, cl 30(1).

9. Bill 20, cl 34.

10. Bill 20, cl 31.

11. Shimco Metal Erecters Ltd. v Design Steel Constructors Ltd., 2002 BCSC 238.

12. Bill 20, cl 54.

13. Bill 20, cl 58.

14. Bill 20, cl 56.

15. Bill 20, cl 52.

16. Legislative Assembly of British Columbia, "How Bills are Passed", online: < https://www.leg.bc.ca/learn/discover-your-legislature/parliamentary-proceedings/how-bills-are-passed >.

17. Bill 20, cl 50.