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In our previous insight, Changes to Ontario's Construction Act: Mandatory annual holdback release, expanded adjudication and more, the amendments arising from Bill 216, Building Ontario For You Act had received royal assent but were not yet in force. Subsequently, the government issued Bill 60, Fighting Delays, Building Faster Act, 2025, which refined some of the changes put forward in Bill 216.
As of January 1, 2026, the key amendments to the Construction Act are in force, along with the supporting regulations. The mandatory annual holdback regime, expanded adjudication framework and updated "proper invoice" provisions that we wrote about in our previous insight are now the governing law for projects across Ontario.
The hallmark of the reforms to the Construction Act is the mandatory annual release of holdback. Below we highlight briefly the changes implemented since Bill 216 received royal assent.
1. Removal of annual lien expiry
Under the previous version of the amendments to the Construction Act, publication of an annual holdback notice would have triggered a separate 60-day lien preservation period specific to that year's obligation to release holdback. This change was ultimately removed by the legislature before the amendments came into force. As a result, owners are still required to release holdback annually, but lien rights do not expire on an annual basis tied to the publication of the holdback notice. The crux of Section 31 (expiry of liens) of the Construction Act remains intact.
For most participants in the construction industry, this is a welcome change which reduces the complexity that would have arisen from having to navigate dual lien timelines: one for annual holdback and another for the work performed.
2. Updated form for annual holdback release
Form 6 – Notice of Annual Release of Holdback under the Construction Act, has been revised to reflect the amended regime and replaces the old Form 6 for notices of non-payment of holdback. Owners have to ensure that they are using the prescribed form when publishing notices of annual release of holdback. Always use the most recent form available here to ensure you are using the correct version of the form.
3. Where notices are to be published
New Regulations formally designate the Daily Commercial News, Link2Build and Ontario Construction News as "construction trade websites." These are the platforms to use for statutory notices under the Construction Act, including notices related to the Notice of Annual Release of Holdback or a Notice of Termination under subsection 31(6) of the Construction Act.
4. Back-and-forth – combining lien and trust claims into a single proceeding
Since the 2019 amendments to the Construction Act, the legislature has gone back and forth on whether it is appropriate to join a trust action with a lien action. Amendments to O. Reg 302/18 settle the debate. The Regulations now permit lien claims and trust claims to proceed in a single court action where they arise out of the same or related facts.
5. Continued expansion of the prompt payment and adjudication framework
The adjudication framework introduced in Bill 216 was not amended by Bill 60 and remain as summarized in our previous insight. Generally, the changes introduced:
- Expand adjudication scope and timing;
- The ability for disputes to be brought to adjudication after completion of a contract;
- Allow parties to select private adjudicators; and
- Deem proper invoices to be "proper invoices," subject to a timely written objection from the owner (within seven days of receiving the invoice).
6. Transition provisions – When do the changes apply?
As a starting point, most of the amendments to the Construction Act apply immediately as of January 1, 2026. However, the transition rules provided are particularly important in determining when the mandatory release of holdback regime is triggered.
Contracts entered before January 1, 2026
For contracts entered prior to January 1, 2026, the annual holdback release requirement does not begin immediately upon proclamation. Instead, the first annual release of holdback will occur on the second anniversary of the contract date that occurs after January 1, 2026. For example, if the anniversary date of the contract is March 1, 2023, the first annual holdback release will not be due until March 1, 2027.
This period will allow owners to adjust administrative practices and prepare for the changes.
P3 Projects
For P3 Projects, where the project agreement with a special purpose entity was entered into before January 1, 2026, the new annual holdback regime will not apply and these projects will continue to be governed by the prior version of the Construction Act.
Note that the annual release of holdback regime will apply to project agreements between the Crown, a municipality or a broader public sector organization and a special purpose entity which are entered into on or after January 1, 2026.
Legacy projects
For completeness, some projects where the procurement process was commenced prior to July 1, 2018, will continue to be governed by the former Construction Lien Act pursuant to section 87.3, and these projects will remain unaffected by the recent amendments.
7. Takeaways
These changes demonstrate Ontario's continued commitment to the policy objective of improving cash flow through prompt payment and mandatory annual holdback release as well as access to interim dispute resolution by means of adjudication.
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