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Retention regime update

Many of you will be aware of the new Retentions regime that came into effect on 31 March 2017. The regime is part of the Construction Contract Amendment Act 2015. Further legislation for the retentions regime, the Regulatory Systems (Commercial Matters) Amendment Bill, was passed by Parliament on Thursday 23 March to take effect on 31 March 2017.

The changes affect all developers, contractors and sub-contractors. Specialist Trade Contractors Federation, Master Builders (RMBA) and the Institute of Quantity Surveyors (NZIQS) issued some guidance notes and FAQs - Retention Guidance Bulletin #1 which you can download here.

Let us know if you have any further questions or concerns and we can pass them on to the group to address. Contact heidi@prefabnz.com

You can also read more about a retention bond as an alternative to holding retentions “on trust” from Builtin Insurance. https://builtininsurance.co.nz/policies/retention-bonds/. A bond gives financial flexibility to contractors and eliminates directors personal trustee liability while still complying with the new Construction Contracts Act rules.

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