A COMPARATIVE STUDY OF THE SECURITY OF PAYMENT LEGISLATION IN SINGAPORE AND MALAYSIA

Abstract

With the recent amendments made to Singapore’s Building and Construction Industry Security of Payment Act Cap. 30B (“SOP Act”), it has been noted that the SOP Act has many possible areas for improvement. Many areas of the SOP Act had been refined and additional exclusions and inclusions have been added into the SOP Act’s (Amendment) Bill which was read on 10 September 2018. Hence, it is important to continually review and revise the SOP Act in order to further improve on the effectiveness of the SOP Act. This study aims to improve the Singapore legislation by carrying out a comparative analysis between the SOP Act and the Malaysian Construction Industry Payment and Adjudication Act 2012 (“CIPAA”) and assessing the application of their differences to the context of Singapore. Through this analysis, it was noted that the SOP Act in comparison to the CIPAA is stricter and has a much rigid structure. Industry experts from both Singapore and Malaysia who are knowledgeable in the construction field were interviewed to gain insights on their perspectives. Recommendations to improve the SOP Act by applying specific existing CIPAA legislation were provided based on the differences that were identified by the comparative analysis conducted. The selection of these recommendations were then further justified by the perspective of the interviewees. Hence, this study has contributed to knowledge by presenting the potential for the improvement of the SOP Act along with the study of the effectiveness of neighbouring country Malaysia’s security of payment legislation.