Circular No: C&P/198/09/tl
3 September 2020
COVID-19 (Temporary Measures) Act and COVID-19 (Temporary Measures) (Amendment) Act (COTMA)
The COVID-19 (Temporary Measures) Act 2020 (COTMA) was passed in Parliament on 7 April 2020. Subsequently, the COVID-19 (Temporary Measures) (Amendment) Act 2020 (the “Amendment Act”) was passed on 5 June 2020.
COTMA provides temporary relief from legal action for those who are unable to perform certain types of contracts due to the Measures that are implemented to contain the spread of COVID-19. An example of such relief is Liquidated Damages (LD) that Contractors may face in meeting their contractual obligation.
We would like to remind members who intend to seek temporary relief under COTMA to serve the notification of relief before 19 October 2020.
The notification of relief could be served to the contracting party/parties to seek temporary relief under COTMA with the following action:
1. Confirm eligibility for relief
· Visit the Ministry of Law website for more information
2. Serve Notice for Relief on the other contracting party / parties
· Use the form
· The Notification for Relief must also be served on any guarantor or surety for the obligation in the contract, and the issuer of any related performance bond
The other party may not agree that relief applies, e.g. your inability to perform obligations is not due to COVID-19. Members are encouraged to discuss with the other party/parties and try to reach a compromise. If you cannot agree, either of you may make an Application for an Assessor’s Determination through a Panel of Assessors for COVID-19 Temporary Relief (PACT) appointed by Ministry of Law (MINLAW). For construction and supply contracts, the determination will be limited to whether there is an inability to perform the obligation, and whether the inability is due to COVID-19. The determination will aim to be fair to both parties. The determination by the Assessor is binding on the parties, and is not appealable.
The details of the Act can be found in Ministry of Law’s website.