Even After Full Enforcement of Revised Construction Industry Act, Only 34% of Construction Companies "Always Secure Contract Modifications" During Material Price Spikes
A survey by Japan Consultant Group reveals a gap between law and practice in the construction industry: despite the revised Construction Industry Act, only 34% of companies successfully modify contracts during material price hikes, and 24% still experience below-cost contracts.
📋 Article Processing Timeline
- 📰 Published: April 4, 2026 at 00:02
- 🔍 Collected: April 4, 2026 at 03:30 (3h 27m after Published)
- 🤖 AI Analyzed: April 21, 2026 at 04:59 (409h 29m after Collected)
The revised Construction Industry Act, which went into full effect after revisions in December 2025, includes provisions that will significantly shift business practices in the construction industry, such as prohibiting unreasonably low labor costs and below-cost contracts, strengthening countermeasures against construction period dumping, and clarifying contract modification rules during material price spikes. On the other hand, as institutional development progresses, there are many pointing out that there is variation in response in on-site practices.
To grasp this current situation, the Japan Consultant Group Co., Ltd. Construction Industry Research Institute (Shinjuku-ku, Tokyo) conducted a questionnaire survey targeting construction companies nationwide regarding their "Status of Compliance with the Revised Construction Industry Act."
■ Survey Overview
Survey Name: Questionnaire survey on the status of compliance with the revised Construction Industry Act
Target: 1,300 construction companies nationwide (random sampling)
Number of Responses: 95 companies (Response rate: 7.3%)
Survey Period: February 9, 2026 - March 6, 2026
Survey Method: Mail (Collection: Mail, FAX, Email, Web)
■ Survey Result 1: Only 34% "always secure contract modifications" during material price spikes
Under the revised Construction Industry Act, it is required to specify the "method of modification" for contract amounts, etc., during material price spikes in the contract, and to negotiate in good faith regarding price changes.
However, when material prices soared, only 34% of companies responded that they "always negotiate contract modifications with the client and sign a modified contract reflecting the amount."
On the other hand,
"Able to modify about half the time": 30%
"Carrying out construction almost at the original amount": 27%
This revealed the reality that a gap still exists between the law and actual practice.
■ Survey Result 2: Below-cost contracts "sometimes occurred" at 24%
-- Practices that were customary will become legal violation risks in the future
Regarding below-cost contracts, the legal enforcement...
To grasp this current situation, the Japan Consultant Group Co., Ltd. Construction Industry Research Institute (Shinjuku-ku, Tokyo) conducted a questionnaire survey targeting construction companies nationwide regarding their "Status of Compliance with the Revised Construction Industry Act."
■ Survey Overview
Survey Name: Questionnaire survey on the status of compliance with the revised Construction Industry Act
Target: 1,300 construction companies nationwide (random sampling)
Number of Responses: 95 companies (Response rate: 7.3%)
Survey Period: February 9, 2026 - March 6, 2026
Survey Method: Mail (Collection: Mail, FAX, Email, Web)
■ Survey Result 1: Only 34% "always secure contract modifications" during material price spikes
Under the revised Construction Industry Act, it is required to specify the "method of modification" for contract amounts, etc., during material price spikes in the contract, and to negotiate in good faith regarding price changes.
However, when material prices soared, only 34% of companies responded that they "always negotiate contract modifications with the client and sign a modified contract reflecting the amount."
On the other hand,
"Able to modify about half the time": 30%
"Carrying out construction almost at the original amount": 27%
This revealed the reality that a gap still exists between the law and actual practice.
■ Survey Result 2: Below-cost contracts "sometimes occurred" at 24%
-- Practices that were customary will become legal violation risks in the future
Regarding below-cost contracts, the legal enforcement...