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Managing Tariff-Related Risks on Design and Construction Projects

This article updates and replaces an earlier Practice Advisory article, "Preparing for Possible Impacts of Tariffs on Projects," published in March 2025. As tariff measures, counter-tariffs, and related trade policies continue to evolve, architectural practices and their clients should remain informed of potential impacts on project costs, schedules, procurement strategies, and contract administration. 

Since early 2025, trade measures between Canada and the United States have created ongoing uncertainty for the design and construction industry. While the specific tariffs and products affected have changed over time, architecture practices report project cost escalation concerns, procurement challenges, supply chain disruptions, delayed decision-making, and increased requests for substitutions and value engineering. 

The Canadian construction industry continues to rely on cross-border trade for many products and materials, manufactured building components, and specialized construction products. As a result, tariff-related pricing pressures and procurement challenges may affect projects for the foreseeable future. 

Considerations for Architectural Practices 

OAA members should review both their professional services contracts and the construction contracts they administer to understand how tariff-related cost increases, delays, substitutions, and other project impacts may be addressed. 

Particular attention should be paid to: 

  • risk allocation provisions; 

  • change provisions and procedures; 

  • cash allowances and contingency allowances; 

  • pricing escalation clauses; 

  • taxes and duties change clauses; 

  • force majeure and delay provisions; 

  • procurement responsibilities; 

  • substitution review processes; 

  • coordination with Buy Canadian and Buy Ontario policies; 

  • schedule extensions; and 

  • owner and contractor notice requirements. 

Members and their clients are strongly encouraged to consult legal counsel as it pertains to contract interpretations and risk management. 

Practices may also wish to revisit policies and procedures developed during the supply chain disruptions experienced during the COVID-19 pandemic. Many of the lessons learned during that period remain relevant where material availability, procurement timing, or price uncertainty become significant project concerns. 

Contract Administration Considerations 

Where tariff-related issues affect materials, products, or equipment specified for a project, practices may encounter an increase in requests for: 

  • substitutions; 

  • alternative products; 

  • value engineering proposals; 

  • deferred product selections; 

  • accelerated procurement decisions; and 

  • changes to construction sequencing. 

As with any proposed substitution or change, carefully consider the implications for code compliance, quality, performance, warranties, coordination with other building systems, and project objectives. 

Practices should maintain clear records of communications, instructions, recommendations, and decisions relating to tariff-related project impacts. 

Communication with Clients 

Practices may wish to proactively discuss tariff-related risks with clients, particularly during project planning, budgeting, and procurement phases. 

Discussion topics may include: 

  • changing product availability; 

  • potential for material cost volatility; 

  • procurement lead-time risks; 

  • contingency budgeting; 

  • schedule flexibility; 

  • alternative material strategies; and 

  • allocation of risk within owner-consultant and owner-contractor agreements. 

Early communication can help minimize surprises and support informed project decision-making. 

Resources for Practices 

For further background knowledge and consideration, practices may want to review the following resources, which include third-party articles that may not necessarily reflect the opinions of the OAA or its governing Council. (Note: This list may be revised as the situation changes and updated information becomes available.) 

OAA Articles on Tariffs and other Government Measures 

- "Potential Tariff Impacts on Projects" (originally published in March 2025 via the OAA Practice Advisory Newsletter) 

OAA Practice Resources 

Third-party articles 

- "Global Vantage: Navigating Canada’s Counter-Tariffs Impacts on Construction," by Andrés Durán and Sherry Hussain (Beale & Co., published by Lexology), September 8, 2026 

- “Dealing with Substitutions,” by Pro-Demnity Insurance Company, December 31, 2016; 

- “Navigating the Trade War: Nine Risk Management Strategies for Architects,” by Leslie Parker (Pro-Demnity Insurance Company), April 3, 2025; 

- “The Implications of Trump Tariffs to Consultants,” by Annik Forristal (McMillan LLP), March 2025; 

- “Preparing your Business for Potential Tariffs: What You Need to Know,” by Canadian Construction Association, January 2025; 

- “Navigating Impacts of Tariffs on the Canadian Construction Industry,” by Erin Peters, Daniel A. Boan and Rebecca Torrance (Borden Ladner Gervais LLP published on Lexology), March 6, 2025; 

- “Tariffs and Your CCDC Construction Contracts: Key Clauses to Review Now,” by Edward (Ted) G. Betts and Aaron Hunter (Gowling WLG published on Lexology), March 11, 2025; 

- “U.S. Tariffs and CCDC 5B Contracts,” by Ontario General Contractors Association, March 13, 2025; 

- “From Clause to Cost: Tariffs Risk in Canadian Construction Contracts,” by Michael Swartz, Kathleen Gregus, and Ethan Levy (WeirFoulds LLP), March 4, 2025; 

- “RAIC Statement on U.S. Tariffs and Their Impact on Canadian Architectural Industry,” by the Royal Architectural Institute of Canada, March 7, 2025; and 

- CCDC Bulletin 11 – Adjustments in Contract Proce Due to Tariffs, originally published in 2025 by the Canadian Construction Documents Committee. 

Members may also want to subscribe to Lexology for updates from various Canadian construction law firms and to be kept informed of legal and regulatory developments regarding the impacts of tariffs on the Canadian construction industry. 

An earlier version of this article originally appeared in an issue of Practice Advisory—a newsletter developed by the OAA’s Practice Advisory Services team, which offers numerous resources for both members and the public. 

The OAA does not provide legal, insurance, or accounting advice. Readers are advised to consult their own legal, accounting, or insurance representatives to obtain suitable professional advice in those regards. 

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