Adjudication Proceedings
Adjudication Mechanism
The Construction Industry Security of Payment Ordinance introduces an adjudication mechanism providing a speedy, cost-effective and binding resolution process for payment disputes in the interim. Under the Ordinance, a payment dispute is regarded to have arisen between the parties to the contract under three specified circumstances:
- the claiming party serves a valid payment claim but the paying party fails to serve a payment response on or before the deadline; or
- the paying party serves a payment response but disagrees with an amount claimed by the claiming party, or
- the paying party, while responding and having admitted an amount due in a payment response, fails to pay the admitted amount in full on or before the deadline
In the above circumstances, the claiming party may initiate adjudication proceedings for the payment dispute under the Ordinance.
Below is the timetable for the adjudication proceedings (based on the maximum time limits set in the Ordinance and it is assumed that only 1 adjudicator nominating body is specified in the contract):
Adjudicator Nominating Body
An Adjudicator Nominating Body (ANB) refers to a corporate body established and maintained by the Secretary for Development under section 62(1)(b) of the Ordinance. The ANB is responsible for specifying the qualifications required for adjudicators, establishing a panel of adjudicators, and formulating nomination procedures to appoint suitable adjudicators to handle payment disputes. It also sets appropriate adjudication rules for conducting adjudication proceedings. The ANB consists of professional organisations familiar with the construction industry and institutions specialising in contract dispute resolution. To ensure the quality of adjudication, the Development Bureau has formulated the main content of adjudication rules, practice guidelines, and a code of conduct for adjudicators, as well as unified guidelines on conflict of interest, which the ANB must follow when drafting relevant documents.
The Development Bureau has been accepting applications for ANBs since 10 February 2025. Details of the application process, adjudication rules, practice guidelines, and the main content of the code of conduct for adjudicators can be found on the Development Bureau's website.
The list of ANBs established by the Development Bureau will be published on the Development Bureau's website. A link will be provided soon.
Adjudicator
Adjudicators are qualified professionals such as engineers, architects, surveyors, and lawyers with experience in handling construction contract disputes. The Ordinance requires adjudicators to declare and disclose any conflicts of interest upon appointment and during the adjudication process.
The panel of adjudicators established and maintained by individual Adjudicator Nominating Bodies will be published on the respective ANB websites. Links will be provided soon.
Cost of Adjudication Proceedings
The cost of adjudication proceedings includes the fees charged by the adjudicator nominating body, the fees and expenses of the adjudicator, and the costs of independent experts appointed, or of inspections of a construction site, construction work or any other things carried out, under Section 35(1). As the costs of adjudication should be within the range affordable to all parties, the Ordinance empowers the Secretary for Development to regulate the fees of nominating bodies and adjudicators. The Development Bureau has specified a reasonable upper limit on the fees in the application guidelines for registration as an adjudicator nominating body. For details, please refer to the Development Bureau’s website.
The cost of individual adjudicator nominating bodies will be published on the respective ANB websites. Links will be provided soon.