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September 26, 2023
There is no doubt that construction products are a key aspect of building safety. However, the law and practice around construction products are enormously complex, in large part due to the fact that until Brexit, the UK's construction product laws were closely tied to EU laws.
That aside, the Building Safety Act 2022 (BSA) included provisions about construction products when it became law last year. Since then, there has been a lot of focus on other aspects of the BSA (like further laws on defining and registering higher risk buildings in April 2023, and new laws on Gateways and the Golden Thread anticipated in October 2023) - but there has been less noise around construction products.
So, where are we with construction products under the BSA?
The Construction Products Regulations 1991 – under these regulations, a construction product is "any product which is produced for incorporation in a permanent manner in works" (with "works" being "construction works, including both buildings and civil engineering works")
Regulation (EU) No. 305/2011 – under these regulations, a construction product is "any product or kit which is produced and placed on the market for incorporation in a permanent manner in construction works or parts thereof and the performance of which has an effect on the performance of the construction works with respect to the basic requirements for construction works" (with "construction works" again being "buildings and civil engineering works").
In light of this, any materials forming part of buildings or civil engineering works are likely to fall under the new BSA regime.
The BSA also covers "cladding products" which (unlike "construction products") are a defined term - described very broadly as “a cladding system or any component of a cladding system”.
What does the BSA say about construction and cladding products?
There is a lot of detail about construction and cladding products in the BSA, but here is a very high-level summary:
Construction products and Construction Products Regulations (s146 / Schedule 11) – these say that further laws can be made around the marketing and supply of construction products in the UK. They give an outline of what these could cover, including to "prohibit the marketing or supply of construction products which are unsafe", and to make provisions for designated standards and technical assessments for construction products. Schedule 11 contains provisions around both "general requirements" and "safety-critical products" (including products which, if they fail, would risk causing death or serious injury to any person). In addition, it makes provision for such regulations to include powers for the National Regulator for Construction Products to enter, inspect and search premises and also to seize and retain products or evidence of non-compliance with construction product requirements.
Liability relating to construction products: general definitions (s147) – this section includes general definitions including for the term "relevant building", which consists of a dwelling or a building which contains two or more dwellings". It also defines "relevant interest" which is used a number of times in the BSA, and is defined differently for England and for Scotland.
Liability relating to construction products (s148) – a party can be found liable for a default relating to construction products, if 4 conditions are met (including around whether a building or dwelling are "unfit for habitation"). This liability cannot be contracted out of. As “unfit for habitation” is not defined, it's likely this will need to be interpreted based on existing court judgments in cases relating to the Defective Premises Act 1972.
Liability for past defaults relating to cladding products (s149) – this section deals with cladding products, setting out liability where 4 conditions are met. One of these conditions involves failure to comply with a "cladding product requirement", but this is defined differently depending on whether the requirements you are looking at were on/before or after 31 December 2020 (due to Brexit) . Another condition is again around buildings or dwellings being "unfit for habitation".
Limitation in England, Wales and Scotland (s150 and s151) – For England and Wales, the BSA extends the liability period for construction products to 15 years; and for defective cladding products, the limitation period is 30 years where the right to claim came into existence before 28 June 2022, and 15 years if after 28 June 2022. For Scotland, the BSA also amends Scottish law so that these limitation periods also apply.
When did these provisions come into effect?
The BSA came into force on 28 April 2022, and Sections 146 to 151 and Schedule 11 (all referred to above) came into effect on 28 June 2022.
Further changes to come?
Nearly a year after the BSA came into force, the Government published the Independent Review of the Construction Product Testing Regime (by Morrell and Day) in April 2023. In brief, this assesses the system for testing and certifying construction products and considers what changes can be made to increase the confidence of construction industry stakeholders and residents that construction products are safe. Its findings are interesting, and its recommendations stretch further than the BSA changes.
In particular, Morrell and Day observed that:
In the construction industry a product may end up as part of a larger system, developing from a raw material to a basic product (insulation, for example), into a component (an insulated panel) into a system/assembly (cladding) and then into a completed building, with all of its systems and sub-systems, which must be built, commissioned, maintained and managed to serve its intended purpose
Under the BSA, all construction products are to be brought into the scope of the CPR (ie the body of Construction Product Regulations as they stand at December 2021) by virtue of a "general safety requirement". This is derived from the EU General Product Safety Regulation (“the GPSR” - also part of UK law) which extends its principles from consumer goods to construction products. The GPSR requires all products intended for use by consumers to be safe in their normal or reasonably foreseeable usage, and therefore the same standard applies for construction products
Whilst there can be no argument against the principle of manufacturers being required to make their products intrinsically safe, there are concerns as to the practicality, proportionality and effectiveness of introducing a regulatory “catch-all” that captures all products (consumer and construction) and extends a principle primarily designed for stand-alone consumer goods to construction products intended to function as a component or part of an assembly.
It will be interesting to see whether these observations contained in the Morrell and Day report are heeded and filter through into the secondary legislation to iron out the current disconnect between the existing raft of regulations which have a consumer 'stand-alone' product bias that does not necessarily (as noted by Morrell and Day) sufficiently deal with the more complex life journey of a construction product.
An acknowledgement of the unique complexities surrounding construction products may have come with the announcement on 1 August 2023 by the Department for Business and Trade that it has extended the use of the CE marking indefinitely in products made by UK businesses - however, the CE mark for construction products will only continue until 30 June 2025, when implementation of the UKCA marking scheme will become mandatory for construction products.
The Construction Products Association (CPA) reacted to this by stating “we hope that today’s announcement reflects a new appreciation by policy makers of the cost and burden caused by the CA Mark scheme. We will appreciate further discussions with the government to ensure the UK construction products sector sees similar clarity very soon.”
It will be interesting to see how those discussions play out over the next two years and how they shape the content of the UKCA marking scheme as it relates to such construction products.
What now?
Moving forward, if they haven't already, manufacturers, distributors and suppliers should:
Assess the risks of their products according to their intended and likely uses
Reduce those risks as far as possible and provide information about any remaining risks
Keep abreast of any developments in the BSA, with specific focus on the Construction Products Regulations that are yet to be introduced
Liaise with their insurers regarding their risks, and bear in mind that the impact on insurance premiums is yet to be seen.
Developers and contractors on the other hand should be:
Contemplating the expanded and retrospective limitation periods which the BSA has brought in, as these are highly likely to increase the volume of previously time-barred claims and open the floodgates to claims for historic defects in relation to cladding products in particular
Reviewing their legacy projects to establish whether any such claims are likely to be brought and, if so, looking at their insurance policies for that time period.
That said, some of these claims will date back many years, up to 30 years in some cases, so both the claimant and defendant may struggle to provide evidence either to support or rebut such claims, with personnel having moved on or retired, and contemporaneous evidence having been destroyed in line with document retention policies.
Finally, everyone should be keeping an eye out for further updates, guidance, laws or other changes that may follow on from the Morrell and Day report or are announced in relation to UKCA and CE marking.
That aside, the Building Safety Act 2022 (BSA) included provisions about construction products when it became law last year. Since then, there has been a lot of focus on other aspects of the BSA (like further laws on defining and registering higher risk buildings in April 2023, and new laws on Gateways and the Golden Thread anticipated in October 2023) - but there has been less noise around construction products.
So, where are we with construction products under the BSA?
Defining construction and cladding products
"Construction product" is not actually defined in the BSA. That said, it refers to two other construction-related regulations (which therefore give a good indication of what is likely to fall within "construction products" under the BSA), namely:The Construction Products Regulations 1991 – under these regulations, a construction product is "any product which is produced for incorporation in a permanent manner in works" (with "works" being "construction works, including both buildings and civil engineering works")
Regulation (EU) No. 305/2011 – under these regulations, a construction product is "any product or kit which is produced and placed on the market for incorporation in a permanent manner in construction works or parts thereof and the performance of which has an effect on the performance of the construction works with respect to the basic requirements for construction works" (with "construction works" again being "buildings and civil engineering works").
In light of this, any materials forming part of buildings or civil engineering works are likely to fall under the new BSA regime.
The BSA also covers "cladding products" which (unlike "construction products") are a defined term - described very broadly as “a cladding system or any component of a cladding system”.
What does the BSA say about construction and cladding products?
There is a lot of detail about construction and cladding products in the BSA, but here is a very high-level summary:
Construction products and Construction Products Regulations (s146 / Schedule 11) – these say that further laws can be made around the marketing and supply of construction products in the UK. They give an outline of what these could cover, including to "prohibit the marketing or supply of construction products which are unsafe", and to make provisions for designated standards and technical assessments for construction products. Schedule 11 contains provisions around both "general requirements" and "safety-critical products" (including products which, if they fail, would risk causing death or serious injury to any person). In addition, it makes provision for such regulations to include powers for the National Regulator for Construction Products to enter, inspect and search premises and also to seize and retain products or evidence of non-compliance with construction product requirements.
Liability relating to construction products: general definitions (s147) – this section includes general definitions including for the term "relevant building", which consists of a dwelling or a building which contains two or more dwellings". It also defines "relevant interest" which is used a number of times in the BSA, and is defined differently for England and for Scotland.
Liability relating to construction products (s148) – a party can be found liable for a default relating to construction products, if 4 conditions are met (including around whether a building or dwelling are "unfit for habitation"). This liability cannot be contracted out of. As “unfit for habitation” is not defined, it's likely this will need to be interpreted based on existing court judgments in cases relating to the Defective Premises Act 1972.
Liability for past defaults relating to cladding products (s149) – this section deals with cladding products, setting out liability where 4 conditions are met. One of these conditions involves failure to comply with a "cladding product requirement", but this is defined differently depending on whether the requirements you are looking at were on/before or after 31 December 2020 (due to Brexit) . Another condition is again around buildings or dwellings being "unfit for habitation".
Limitation in England, Wales and Scotland (s150 and s151) – For England and Wales, the BSA extends the liability period for construction products to 15 years; and for defective cladding products, the limitation period is 30 years where the right to claim came into existence before 28 June 2022, and 15 years if after 28 June 2022. For Scotland, the BSA also amends Scottish law so that these limitation periods also apply.
When did these provisions come into effect?
The BSA came into force on 28 April 2022, and Sections 146 to 151 and Schedule 11 (all referred to above) came into effect on 28 June 2022.
Further changes to come?
Nearly a year after the BSA came into force, the Government published the Independent Review of the Construction Product Testing Regime (by Morrell and Day) in April 2023. In brief, this assesses the system for testing and certifying construction products and considers what changes can be made to increase the confidence of construction industry stakeholders and residents that construction products are safe. Its findings are interesting, and its recommendations stretch further than the BSA changes.
In particular, Morrell and Day observed that:
In the construction industry a product may end up as part of a larger system, developing from a raw material to a basic product (insulation, for example), into a component (an insulated panel) into a system/assembly (cladding) and then into a completed building, with all of its systems and sub-systems, which must be built, commissioned, maintained and managed to serve its intended purpose
Under the BSA, all construction products are to be brought into the scope of the CPR (ie the body of Construction Product Regulations as they stand at December 2021) by virtue of a "general safety requirement". This is derived from the EU General Product Safety Regulation (“the GPSR” - also part of UK law) which extends its principles from consumer goods to construction products. The GPSR requires all products intended for use by consumers to be safe in their normal or reasonably foreseeable usage, and therefore the same standard applies for construction products
Whilst there can be no argument against the principle of manufacturers being required to make their products intrinsically safe, there are concerns as to the practicality, proportionality and effectiveness of introducing a regulatory “catch-all” that captures all products (consumer and construction) and extends a principle primarily designed for stand-alone consumer goods to construction products intended to function as a component or part of an assembly.
It will be interesting to see whether these observations contained in the Morrell and Day report are heeded and filter through into the secondary legislation to iron out the current disconnect between the existing raft of regulations which have a consumer 'stand-alone' product bias that does not necessarily (as noted by Morrell and Day) sufficiently deal with the more complex life journey of a construction product.
An acknowledgement of the unique complexities surrounding construction products may have come with the announcement on 1 August 2023 by the Department for Business and Trade that it has extended the use of the CE marking indefinitely in products made by UK businesses - however, the CE mark for construction products will only continue until 30 June 2025, when implementation of the UKCA marking scheme will become mandatory for construction products.
The Construction Products Association (CPA) reacted to this by stating “we hope that today’s announcement reflects a new appreciation by policy makers of the cost and burden caused by the CA Mark scheme. We will appreciate further discussions with the government to ensure the UK construction products sector sees similar clarity very soon.”
It will be interesting to see how those discussions play out over the next two years and how they shape the content of the UKCA marking scheme as it relates to such construction products.
What now?
Moving forward, if they haven't already, manufacturers, distributors and suppliers should:
Assess the risks of their products according to their intended and likely uses
Reduce those risks as far as possible and provide information about any remaining risks
Keep abreast of any developments in the BSA, with specific focus on the Construction Products Regulations that are yet to be introduced
Liaise with their insurers regarding their risks, and bear in mind that the impact on insurance premiums is yet to be seen.
Developers and contractors on the other hand should be:
Contemplating the expanded and retrospective limitation periods which the BSA has brought in, as these are highly likely to increase the volume of previously time-barred claims and open the floodgates to claims for historic defects in relation to cladding products in particular
Reviewing their legacy projects to establish whether any such claims are likely to be brought and, if so, looking at their insurance policies for that time period.
That said, some of these claims will date back many years, up to 30 years in some cases, so both the claimant and defendant may struggle to provide evidence either to support or rebut such claims, with personnel having moved on or retired, and contemporaneous evidence having been destroyed in line with document retention policies.
Finally, everyone should be keeping an eye out for further updates, guidance, laws or other changes that may follow on from the Morrell and Day report or are announced in relation to UKCA and CE marking.
SOURCE:
https://www.womblebonddickinson.com/uk/insights/articles-and-briefings/building-safety-where-are-we-construction-products
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