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Construction Contracts Act 2002

The Construction Contracts Act 2002 provides a process for dealing with payments and disputes under a construction contract, including requirements for withholding retention money from subcontractors.

The Construction Contracts Act:

  • protects retention money withheld under commercial construction contracts
  • helps to ensure a fair, balanced and timely payment regime
  • provides a fast and cost-effective adjudication process for people with disputes
  • provides enforcement mechanisms to recover any unmade payments.

Retention money

On 5 October 2023, new requirements for withholding retention money came into force. The new requirements make it easier for subcontractors to access retention money without a court order, should a head contractor become insolvent.

The new requirements apply only to new commercial contracts from 5 October 2023 and existing commercial contracts that are renewed on, or after, that date. They do not apply to construction contracts with homeowners/residential occupiers.

Other requirements

Learn about payments and disputes under the Construction Contracts Act 2002.

Previous amendments

Learn about other changes made to the Construction Contracts Act since it was introduced in 2002.

This information is published by the Ministry of Business, Innovation and Employment’s Chief Executive. It is a general guide only and, if used, does not relieve any person of the obligation to consider any matter to which the information relates according to the circumstances of the particular case. Expert advice may be required in specific circumstances. Where this information relates to assisting people: