ROLES, RESPONSIBILITIES & CIDB ACT 520

Ahmad explained about the aim of CIDB Act 520 which was introduced to regulate, develop and ease the construction industry towards competing on a global scale. He explained that since 1994, the Act has been improved and revised to drive a robust construction industry. The objective of the Act is to build capacity and capability within the construction industry through improved quality and productivity by focusing on professionalism, innovation and knowledge towards quality of life. Ahmad elaborated that CIDB’s mission is to develop the construction industry in Malaysia, and its vision is to achieve global excellence in the construction industry.

CIDB has 14 distinct functions that include advancing and stimulating development, improving and expanding the construction industry; serving as an advisory and giving recommendations to the Federal government and state governments on industry matters; advancing and driving research associated with the industry; and, controlling the quality of workmanship within the industry, among other functions.

In defining the role of contractors, Ahmad explains that contractor is an individual that carries out or completes or pledges to carry out and complete work. A registered contractor is an individual registered under Act 520. He also expounded on the meaning of construction works which is to build, restore, install, repair, maintain, refurbish, improve, change and demolish buildings.

He stresses that contractors have five key responsibilities that include registering with CIDB under Act 520, declaration and levy, personal construction, site supervision and expertise, as well as construction materials. According to Ahmad, Section 25 (1) of the Act stipulates that no person is to carry out or complete, or pledge to undertake any kind of construction work as a contractor unless the individual is registered with CIDB and holds a valid registration certificate issued by the board. Meanwhile Section 29 of the Act states that any person found to contravene sub-section 25(1) is committing an offence and is liable, if convicted, to face a fine of not less than RM10,000 and not exceeding RM100,000.

Ahmad also shared the registration criteria for contractors from Grade G1 to G7. He also shared about the codes and scope of work of each grade, starting from Grade G1 with an eligibility to tender and take on projects not more than RM200,000 up to G7, with an eligibility to take on projects of unlimited value. He also advised on parameters for financial capabilities evaluation. He also explained about CIDB’s Centralised Information Management System which enables contractors to register, make declaration on projects and levy, scores, appeals and disciplinary action, competency management, and construction personnel, among other features.

Section 34(1) of the Act calls for contractors to declare and submit to the Board, all construction project contracts that have been awarded. Meanwhile, Section 34(2) states that all contracts that are mentioned under subsection (1), which has a value of more than

RM500,000, the contractors are responsible to pay to the Board a levy at the rate of a quarter percent of the contract’s value. Section 34(3) states that every contractor has to fully manifest the facts to the Board and condition concerning liabilities on levy.

Contractors who fail to pay the stipulated levy within the timeframe provided by the Board, are committing an offence and liable to be fined not more than RM50,000 or four times the value of the levy, whichever is higher. Contractors who do not comply to sub-section (1) and (3) are committing an offence and are liable, if convicted, to be fined not more than RM50,000. Ahmad stressed that personnel carrying out any type of construction works must be registered, if not they are liable to be fined. Section 2(1) of the Act stipulates that construction personnel include general workers, partially-skilled workers, skilled workers, project managers, and any other worker involved in construction work. The criteria for registration of construction personnel includes all workers being of the age of 18 years and above (except for Sabah and Sarawak, where the minimum age is 16 and above); involvement or working in the construction industry and carrying out works; to have attended Safety Induction course for construction personnel, which is recognised by CIDB; and, adhering to all laws under Act 520. He showed samples of the ‘green card’ issued by CIDB to all registered construction industry personnel. Ahmad showed the attendees the list of skilled construction personnel under Schedule 3, stipulated in Seksyen 2 and subseksyen 33A(2).

Materials or products used in the construction industry require the approval of CIDB. Section 33(1) of the Act stipulates that all contractors have to comply with the list of materials in Schedule 4, failing which they will face a fine. Those found using materials that are not recognised or approved by CIDB are liable to be fined. Ahmad shared many instances where construction companies have been fined for non-compliance to the Act. Schedule 4 of the Act provides a comprehensive list of standard materials approved and recognised by the Board.