Are there any specific requirements that parties should be aware of in relation to: (a) health and safety; (b) environmental issues; (c) planning; (d) employment; and (e) anti-corruption and bribery.

Construction (2nd edition)

Australia Small Flag Australia

(a) Health and safety;

Model work, health and safety ('WHS') laws exist across jurisdictions (other than Victoria and Western Australia) to achieve significant harmonisation of WHS obligations. The common statutory regime imposes obligations on persons conducting a business or undertaking to (amongst other things) take reasonably practicable steps to ensure the health and safety of workers and others including by providing a safe work environment, safe plant and structures, systems of work, the same use, handling and storage of plant, structures and substances, information, training and instruction to protect all persons from risks to their health and safety and monitoring the health of workers and the conditions at the workplace. Specific obligations are also imposed on entities with management and control of a workplace and on entities which have been appointed as a principal contractor for construction work. There is a positive, personal duty imposed on individual officers to exercise “due diligence” to ensure their organisation complies with WHS obligations. There are also personal obligations imposed on workers. There are significant penalties that can be imposed against companies, individual officers and workers for breaching WHS obligations.

(b) Environmental issues;

At a federal level, a construction project that is likely to have a significant impact on nationally protected matters, such as threatened species of flora or fauna and heritage properties, may be referred to the environment minister. The minister may approve a project unconditionally or with conditions, refuse a project, or decide that federal assessment is required.

Environmental requirements vary between jurisdictions. Generally, approval or licencing will be required if the project generates air pollution, noise, if it impacts biodiversity or heritage items, or involves environmentally hazardous chemicals or contaminated land

(c) Planning;

Planning legislation regulates development within specific zones. Where a construction project is permissible with consent in a zone, a development application is submitted to the designated planning authority and will be subject to specific development controls (e.g. building height, setbacks and floor space ratio). Where a construction project is permitted without consent, it can proceed without a development application (although other building and environmental consents may be required).

(d) Employment; and

Employment relationships are generally governed by the Fair Work Act 2009 (Cth), which sets national minimum standards for matters including maximum weekly hours, leave, notice of termination and redundancy pay. The Australian employment regime is unique in the application of industrial 'awards' with force of law which establish additional minimum standards for employers and employees across industry and occupational lines. Employees in the construction industry may be covered by the Building and Construction General On-site Award 2010, for example. Additional employment obligations are imposed on entities that have tendered for Commonwealth-funded work. Industrial disputes are subject to a Conciliation and Arbitration legal system which regulates how industrial action may proceed and allows for judicially imposed settlement of disputes. The Building and Construction Industry (Improving Productivity) Act 2016 (Cth) also regulates certain matters such as unlawful industrial action or attempting to coerce employers or employees entering into or altering industrial agreements.

(e) Anti-corruption and bribery.

Under the Commonwealth Criminal Code, it is an offence to provide, offer to provide, or cause a benefit to be offered or provided to a person that is not legitimately due to that person. The offer must be made with the intention of influencing a foreign public official to obtain or retain business or a business advantage that is not legitimately due to them. There are also similar offences under the Commonwealth Criminal Code in relation to the offering of benefits to Commonwealth public officials.

The Code imposes penalties of either imprisonment or significant fines for individuals and corporations. Additionally, if a contractor has illegally obtained the award of a contract, it will likely be void and unenforceable.

There are also offences under the laws of each State and Territory in relation to the offering, solicitation or receipt of corrupt benefits, including in relation to transactions between private parties as well as with local public officials. Some states have independent corruption investigatory bodies, with significant legal powers to investigate corruption affecting government bodies.

Belgium Small Flag Belgium

(a) health and safety;

Health and safety on construction sites is regulated by the Act of 4 August 1996 regarding the well-being of employees in the execution of the works and various implementing royal decrees.

Some of these royal decrees were recently codified in the Code on the well-being at work (adopted on 28 April 2017).

The Royal decree of 25 January 2001 relating to the temporary or mobile working areas is one of the main relevant royal decrees in this area and i.a. implements EU Directive nr. 92/57/EEC.

Pursuant to the above regulatory framework, the building direction or the owner must appoint a health and safety coordinator. This person shall supervise the design and the execution phase in order to make sure all health and safety rules are complied with.

(b) environmental issues;

In all three regions, operating activities or installations that are potentially harmful to the environment are subject to an environmental permit or notification and/or to general, sectoral and/or specific operating conditions. The regulatory framework is set out by:

  • the Flemish Act of 25 April 2014 regarding the integrated environmental permit;
  • the Walloon Act of 11 March 1999 regarding the environmental permit;
  • the Brussels Act of 5 June 1997 regarding the environmental permits.

All three regions have enacted more or less comprehensive sets of rules relating to material life cycle and waste management and soil pollution. The regulatory framework is set out by, respectively:

  • the Flemish Act of 23 December 2011 regarding the sustainable management of waste and the life cycle of materials and Act of 27 October 2006 regarding soil clean up and protection;
  • the Walloon Act of 27 June 1996 regarding waste and Act of 5 December 2008 regarding soil management; and
  • the Brussels Act of 14 June 2012 regarding waste and Act of 5 March 2009 regarding soil pollution and clean up management.

In the framework of the evolution towards a circular economy, the interplay between EU, federal and/or regional rules oftentimes entails specific obligations (e.g. use of specific materials, energy performance requirements, specific requirements for demolition, etc.).

Pursuant to EU obligations, the 3 Regions adopted specific legislation in order to integrate the requirement of an Environmental Impact Assessment (EIA) for plans and projects.

(c) planning;

Planning policy being a regional competence, the regulatory framework is set out by:

  • the Flemish Urban Planning Code of 15 May 2009;.
  • the Walloon Territorial Development Code of 20 July 2016; and
  • the Brussels Urban Planning Code of 9 April 2004.

NB: all three Regions have, to a greater or lesser extent, integrated urban planning law with the environmental permitting scheme, the most notable example being Flanders’ integrated environmental permit (“omgevingsvergunning”).

(d) employment, and

Belgian labor law is mainly based on the Act of 3 July 1978 regarding employment agreements.

Note that foreign contractors executing a temporary assignment in Belgium must fill in the so-called “LIMOSA-declaration”. Failure to make such a declaration may result in criminal or administrative sanctions.

Furthermore, anyone commissioning construction works with a contractor must, at the time of signature of the contract and afterwards, during the execution of the works, verify that the contractor has no outstanding fiscal or social security debts. If so, one may incur joint and several liability for such debts or will have to retain a certain percentage of the sums due to the contractor (during the execution phase of the works). The contracting parties also incur joint and several liability for non-payment of the wages (or the minimum wage) of the (foreign) employees. It is possible to be (temporarily) exempted from this joint and several liability by including a specific provision in the contract. However, the exemption shall be lifted if the inspection reports non-payment and the client does not respond in time. There is also an obligation for contractors to report construction sites to the NSSO (National Social Security Office). Failure to comply with this obligation will result in sanctions. In principle, the hiring out of workers is also prohibited in Belgium, for the employers' authority is not to be transferred to another entity (user).

(e) anti-corruption and bribery

Detailed rules on anti-corruption and bribery can be found in the Criminal Code. The offence of bribery is dealt with within articles 246 and following (public bribery) and articles 504bis and ter (private bribery) of the Criminal Code. It is important to know that both active and passive bribery can lead to prosecution. Penalties are increased in transnational and/or public settings.

China Small Flag China

(a) health and safety

Law on Work Safety and administrative regulations promulgated by State Council such as Regulations on Administration of Construction Safety, Regulations on Safe Work Permits specifically provide for that all parties to construction and engineering projects shall observe the provisions of the laws and regulations on work safety, ensure construction safety, and assume the responsibility in terms of construction safety according to law.

(b) environmental issues;

The Ministry of Ecology and Environment of PRC is the main body that enforces the anti-pollution laws, which include Environmental Protection Law, Law on Environmental Protection Tax, Law on the Prevention and Control of Atmospheric Pollution, Law on Prevention and Control of Water Pollution Law on Environmental Impact Assessment Control, Law on Promotion of Cleaner Production. Other important administrative regulations regarding environmental issues include Regulations on Environmental Protection Management for Construction Projects.

These laws manifest that compliance with environmental laws and regulations are vital to every stage of a construction and engineering project, from commencement of work and construction management to inspection and taking over. These laws and regulations encourage operators not to pollute, and to provide a framework for offenders to be punished. Penalties generally include fines, suspension of projects and provisions for jail terms.

(c) planning;

According to Law on Urban and Rural Planning, prior to commencement of development, the developing entity shall apply for a permit for a planned construction project to the department in charge of urban and rural planning. Upon completion of a project, the department in charge shall check whether a construction project is in compliance with the conditions for planning. If a construction project is not checked, or checking proves that it does not comply with the conditions for planning, the developing entity may not arrange for acceptance check upon completion of the project.

(d) employment; and

Any employment involved in a construction and engineering project shall comply with Labor Law, a law formulated in accordance with the Constitution with a view to safeguarding laborers' lawful rights and interests.

(e) anti-corruption and bribery.

Criminal Law outlaws corruption and bribery in both the public and private sector and Law on Bid Invitation and Bidding and Law on Government Procurement specifically prohibits corruption during selection stage in construction industry. For prevention of corruption and bribery by any public functionaries who exercise public power, there is the newly published Supervision Law of the PRC, as well as Law on Public Servants.

Croatia Small Flag Croatia

(a) health and safety;

Health and safety at construction sites is regulated by the provisions of the Health and Safety Act, the Labour Act, the Act on Construction, the State Inspectorate Act, the Ordinance on safety at temporary and mobile construction sites, the Ordinance on jobs with special working conditions etc. The abovementioned provisions oblige the investors, designers and contractors to apply safety rules in all stages, from design to completion of works. An employer performing construction works is obliged, prior to the commencement of works, to arrange a work site and ensure that the works are executed and carried out in accordance with the abovementioned regulations and rules on occupational safety.

(b) environmental issues;

Environmental issues are governed by a large number of legislative provisions such as the Environmental Protection Act, the Air Protection Act, the Water Act, the Act on Sustainable Waste Management etc. Environmental impact assessments are prescribed under the Environmental Protection Act as well as under the Regulation on the Environmental Impact Assessment. In the process of assessing the need for an environmental impact assessment, the competent authority, based on individual tests in accordance with standards (e.g. capacity, power, surface area etc.) and/or criteria established in the mentioned Regulation, determine whether the project could have significant environmental impacts and decide on the need for an assessment.

(c) planning;

Before the construction works commence, planning and zoning permission and the building permission are required. They are issued by the competent authority prescribed by the construction law. The public authority is authorised to inspect whether the final building permission exists as well as the compliance with other relevant laws and obligations (health and safety, environmental law etc.).

(d) employment; and

The Labour Act is the main act that regulates employment in Croatia, i.e. employment contracts, the minimal age for employment, rest and leave, salaries, night work, shift work, overtime, work strikes, etc. The minimum salary is defined by the Minimum Salary Act and is determined as the lowest monthly amount of gross salary paid out to an employee for a full-time job. Employment issues are also regulated by international agreements, treaties, collective agreements and employment agreements. The Collective Agreement for the Construction Industry was extended by the Government decree to all employees in this sector, which means that all employers should abide by the provisions of the Collective Agreement. In general, EU/EEA citizens are not required to have any work permit to work in Croatia. However, citizens from certain EU / EEA countries still need work permits in Croatia. As for non-EU/EEA citizens, residence permits and work permits are required in order for them to be employed in Croatia. An application for a residence and work permit must be accompanied by an employment contract or a written confirmation that an employment contract has been signed.

(e) anti-corruption and bribery.

There isn’t a single law regulating this topic. The primary legal framework regulating corruption and bribery is contained in the Criminal Code and the Corporate Criminal Liability Act, which make natural persons and legal entities criminally liable for corrupt practices including active and passive bribery, money laundering and abuse of functions. Giving or accepting a bribe is a criminal offence in Croatia.

Germany Small Flag Germany

(a) health and safety;

Most German health and safety laws apply to the employment sector (e.g. Labor Protection Law (Arbeitsschutzgesetz), social security code (Sozialgesetzbuch - SGB) and workplaces ordinance (Arbeitsstättenverordnung, Occupational Safety Act (Arbeitssicherheitsgesetz), Ordinance on Hazardous Substances (Gefahrstoffverordnung) Safety regulations of the professional associations (Sicherheitsvorschriften der Berufsgenossenschaften) Construction Site Ordinance (Baustellenverordnung)).

(b) environmental issues;

The protection of the environment is anchored in German constitutional law (Article 20a of the German constitution). However, there is no central body for environmental law. Legislative provisions concerning environmental issues are widely scattered across many laws. A central provision of German environmental law is the Federal Nature Conservation Act (Bundesnaturschutzgesetz - BNatSchG), another the Federal Pollution Control Act (Bundesimmissionsschutzgesetz - BImSchG).

(c) planning;

Planning law in Germany consists of the technical planning and construction planning law. In accordance with special regulations (Federal Highway Act - FStrG, General Railway Act - AEG, Air Traffic Act - LuftVG, Energy Industry Act - EnWG), a plan approval procedure must be carried out regularly. Otherwise, the regulations of the Building Code (BauGB) apply to "normal" construction projects. Architect and engineers may claim a minimum remuneration according to a fee ordinance binding for this industry: the HOAI. However, fees may be freely negotiated for large projects.

(d) employment;

The employment sector is highly regulated in Germany. Many German employment laws are based on European legislation. German employment law is codified in the German Civil Code (Bürgerliches Gesetzbuch – BGB), in the German Protection Against Dismissal Act (Kündigungsschutzgesetz - KSchG), in the German Labor Protection Act (Arbeitsschutzgesetz) and in many other laws and regulations.

(e) anti-corruption and bribery.

The most relevant anti-corruption provisions are laid down in the paragraphs 331 seqq. of the German Criminal Code (Strafgesetzbuch – StGB). However, there are anti-corruption provisions in other laws like the law on combating international corruption (Gesetz zur Bekämpfung internationaler Bestechung).

Greece Small Flag Greece

(a) health and safety;

Any person/entity employing personnel in Greece (irrespective of whether employees are occupied in the construction of public or private projects) is under the obligation to observe certain minimum health and safety standards. Pursuant to Law 3850/2010, all enterprises operating in Greece are under the obligation to employ a technical security specialist, whereas enterprises employing more than fifty (50) employees shall, additionally, employ an occupational physician. Moreover, the employer shall take all necessary measures to ensure the application of health and safety rules at work, inform both the employees' representatives and the Labour Inspectorate on a number of health and safety related issues maintain an accidents data base, as well as encourage further training of its personnel.

(b) environmental issues;

As per Art. 2 of Law 4014/2011, implementation of private or public projects or activities which are likely to cause significant effects on the environment requires the issuance of an environmental permit following conduct of an environmental impact study and issuance of a decision approving the environmental terms. On the other hand, projects or activities with local and limited impact on the environment are only subject to certain standard environmental commitments, as prescribed by same law. The issuance of such environmental terms approvals, where required, is a prerequisite for any other administrative permits/approvals to be issued.

(c) planning;

Based on Art. 29 para. 1 of Law 4495/2017, any construction work, such as the erection, modification and restructuring of buildings/facilities, requires the prior issue of a building permit. Such building permits are subject to renewal, in accordance with Art. 42 of the aforementioned law. In addition, as per Art. 10 of Law 3028/2002, in case of works to be performed on or in the proximity of monuments and historic buildings, a ministerial consent is required as a prerequisite for the granting of the building permit.

(d) employment; and

According to the Greek labour legislation, the eight-hour workday system applies, whereas overtime work and relevant payment, as well as annual leave matters are also strictly regulated. Employment contracts of indefinite duration can be terminated at any time, unilaterally by either party, either with or without prior notice, such termination being subject to mandatory formal requirements; it being understood that, in case of termination by the employer, the employee is entitled to the applicable severance payment (Law 2112/1920 as amended by Law 4093/2012), whereas failure of the employer to pay the applicable severance payment renders the termination null. Finally, it is noted that, in order for an entity to legitimately employ any person in Greece, registration with the competent Greek tax authority and the relevant social security fund is mandatory; in this respect, the employer is under certain tax withholding obligations and is responsible for the payment of the statutory social security contributions for its personnel.

(e) anti-corruption and bribery.

Based on the Greek anti-corruption legislation, all payments and expenses must be in accordance with one's economic activity and duly registered in the records of a commercial entity, otherwise such payments or expenses may be perceived as fictitious transactions. Further to the above, commercial payments are also scrutinised under tax legislation (primarily Law 4174/2013) and money laundering legislation (Law 3691/2008), non-compliance with which incurs heavy sanctions, such as administrative fines, temporary or permanent cease of activities, prohibition of certain business activities and ban from public procurements. Moreover, Greece has ratified the UN Convention on Combating Corruption (Law 3666/2008), whereas a General Secretariat against Corruption was established by Law 4320/2015. Further to the above, the Greek Criminal Code penalizes bribery under a number of legal bases (Art. 159, 159A, 234-237, 237A, 237B, 239).

Furthermore, Art. 38 of Public Procurement Law provides for the operation of a Central Electronic Register of Public Contracts, which aims at the collection, processing and publicity of data regarding public contracts concluded by contracting authorities/entities and central purchasing bodies. Additionally, Law 3310/2005, relating to the transparency of public contracts, imposes disclosure obligations on any private entity that has been awarded a public contract.

Switzerland Small Flag Switzerland

(a) health and safety;

In respect of health and safety, for older buildings (in particular those built before the ‘90s), building permits are subject to an asbestos-analysis, and in some Cantons, to a PCB/leaded-paint analysis. In case the building contains asbestos (or PCB/leaded-paints), special requirements for workers must be complied with by the contractor (duty to report, paper trail, special equipment to be used by the workers, etc.) and the hazardous materials must be eliminated in authorized waste disposal areas.

With regard to health and safety, the revision of the statute of limitations in the CO should be taken into consideration which will enter into force on January 1, 2020. The limitation period will be extended from one year to three years from the day on which the injured party became aware of the damage and of the person liable for compensation. In the event of personal injury, claims for damages or satisfaction shall become time-barred after a period of twenty instead of ten years from the day on which the harmful conduct occurred or ceased.

(b) environmental issues;

In respect of environmental regulations, in case of existence of hazardous material and/or soils pollution, the parties have to comply with specific federal/cantonal provisions regarding the removal,waste management and treatment of such hazardous material/pollution. The sale (broadly defined), except for by way of a share deal, of polluted sites in particular requires a special authorization.

(c) planning;

In respect of planning regulations, the most important point is that the construction project complies with the planning and zoning regulations applicable to the zone area where the construction project is located, it being specified that such regulations are usually cantonal and/or communal depending on the Canton. In particular, the construction project must be in line with the permitted allocation and the construction regulations of the area, which are set out in legal acts and/or in zoning or neighborhood plans. On top, projects in touristic areas having more than 20% of holiday homes must comply with the requirements of the so-called “Lex Weber”.

(d) employment; and

In respect of employment regulations, the contractor has to comply with general principles such as equality of treatment, non-discrimination, rules applicable to foreign workers, pension funds and social security regulations, etc. The contractor must also comply with provisions on health and safety at work with respect to its employees.

(e) anti-corruption and bribery.

In respect of anti-corruption provisions, no specific rules apply to the construction sector solely, and standard anti-corruption and bribery regulations apply.

United States Small Flag United States

(a) Health and safety;

The Federal Occupational Safety and Health Act, 29 U.S.C. Sec. 15 (1970) extends to all employers and their employees in all 50 states, the District of Columbia, Puerto Rico and other territories under federal jurisdiction. The law was enacted to ensure worker and workplace safety, with the intent to require employers to provider workplaces free from recognized hazards to safety and health, such as exposure to toxic chemicals, excessive noise levels, mechanical dangers, heat or cold or unsanitary conditions. The law is enforced by the Occupational Safety and Health Administration (OSHA), which is a division of the U.S. Department of Labor.

OSHA has enacted numerous regulations governing health and safety for construction activities. Any entity performing construction work within the United States or its territories must comply with OSHA regulations governing construction safety. See 29 CFR 1926. The OSHA standards for construction govern a diverse range of safety and health issues from safety training and education, to the types of personal protective and life safety equipment required. Careful review and compliance with these regulations is important, as substantial fines can be assessed for non-compliance.

In addition to OSHA, many states have enacted their own occupational safety and health laws. For example, Maryland has adopted the Maryland Occupational Safety and Health Act (MOSH Act) for all non-federal projects within the State of Maryland. Under the MOSH Act, all employers are required to comply with health and safety regulations adopted by the Maryland Department of Labor, Licensing, and Regulation -- Division of Labor and Industry. These regulations closely mirror the Federal Occupational Safety, but include a number of distinct substantive regulations. Failure to comply with MOSH regulations can result in significant daily penalties as well as criminal liability for willful violations.

Maryland is not unique. Many other states, such as Alaska, California, Hawaii, Indiana and the District of Columbia also have state health and safety plans governing construction projects. Knowing and understanding the obligations imposed upon employers through these regulations is critical to avoiding costly penalties that can undermine the success of a construction project.

(b) Environmental;

Construction projects involving clearing, grading, excavation or demolition may require compliance with federal environmental regulations. In addition, if the Project will involve dredging or the discharge of fill material into a waterway or wetland specific sections of the Clean Water Act apply and strict compliance with those sections is required. Additional requirements under the Clean Air Act may apply to heavy-duty trucks used for construction and may require regulation of dust emissions at your construction site. Other requirements apply to the use of hazardous materials as well as to requirements mandating reporting of any spill of a hazardous chemical.

Most of the environmental requirements applicable to U.S. construction projects are regulated by the United States Department of Environmental Protection (US EPA). The US EPA has, however, delegated authority to states to regulate certain aspects of the Clean Air Act as well as other regulatory programs. Fines for non-compliance with environmental regulations can result in civil penalties and in some circumstances, even criminal liability.

(c) Planning;

As noted below, most jurisdictions have land use and zoning laws that must be adhered to. Knowing the applicable zoning laws and allowable uses for your property prior to commencing design and construction is imperative. Failure to comply with applicable zoning or land use laws can result in fines and, potentially, demolition of non-conforming work. Typically, these issues are addressed during the permitting phase of the project. At that stage the local permitting authority reviews completed construction drawings for compliance with building codes and land use and zoning laws prior to issuing a construction permit.

(d) Employment;

In the United States, there are numerous requirements that govern employment relationships for construction. For example, when performing construction work in the United States, it is common to encounter union labor. Special legal requirements apply when union labor is used. Even if union labor is not used, however, there are several other employment requirements applicable to construction projects.

In 1935, the National Labor Relations Act (NLRA) was passed in the United States. The NLRA provides the framework and foundation for collective bargaining between unions and employers. Collective bargaining is the process by which an employer and a union negotiate wages, benefits and other terms of employment. The NLRA is administered by the National Labor Relations Board (NLRB). The NLRB has exclusive jurisdiction over certain labor disputes between an employer and a union including the right to investigate unfair labor practices, levy charges, bring cases and issue enforcement orders. The nuances relating to the use of union labor in the United States could fill an entire chapter of its own. Understanding the requirements imposed by the NLRA and the implementing regulations promulgated by the NLRB, however, is important if union labor will be used during any aspect of the construction process.

Other major employment laws applicable to construction in the United States include the Fair Labor Standards Act and corresponding state laws (e.g., Maryland Wage and Hour law), state wage payment and collection laws and the Davis-Bacon Act.

The Fair Labor Standards Act (FLSA) is a federal law that mandates minimum wage, overtime pay and youth employment protections. While the FLSA does exempt some employees (e.g., certain executive, administrative and professional employees) construction workers are typically non-exempt and covered by FLSA. As a result, construction employees are entitled to be paid at least a federal minimum wage as well as time and a half for all hours worked over 40 in a work week. Many states have also enacted their own wage and hour laws that are applicable to most construction employees. Maryland, for example, requires employers to comply with state minimum wage laws and provides an employee with a private cause of action against an employer for violating the law. Numerous other states have enacted similar laws. Failure to comply with FLSA or applicable state laws can result in significant penalties, significant damages, and in some instances having to pay the legal fees incurred by an employee to recover his or her wages.

Finally, the Davis-Bacon Act, and its corresponding regulations, mandates the wages paid for work performed on any federal construction project. The Davis-Bacon Act applies to all federal government or District of Columbia contracts in excess of $2,000 for the construction, alteration, or repair of public works. See 49 U.S.C. Sec. 3141-3148. Under the Davis-Bacon Act, all contractors and subcontractors are required to pay workers in accordance with the wage rates set by the Secretary of Labor. If a contractor fails to comply with the Davis-Bacon Act, the government can withhold payments due to the contractor under the contract. As with wage and hour laws, many states have enacted laws similar to the Davis-Bacon Act requiring contractors and subcontractors to pay prevailing wage rates on state construction projects.

(e) Anti-corruption and bribery.

The United States Department of Justice (DOJ) aggressively prosecutes bribery and corruption both within the United States and globally. The principal U.S. law governing bribery and anti-corruption is the Foreign Corrupt Practices Act (FCPA), 15 U.S.C. Sec. 78dd-1, et seq. In addition, 18 U.S.C. Sec. 201 makes bribery of public officials and witnesses in the United States a crime.

Pursuant to 18 U.S.C. Sec. 201, it is a crime to directly or indirectly offer or promise anything of value to any public official or person who has been selected to be a public official with the intent to influence an official act or induce such person to do any act in violation of the lawful duty of such person. 18 U.S.C. Sec. 201(b). It is also illegal to directly or indirectly give or promise anything of value to a public official, former public official or person selected to be a public official because of an act performed by such person. See 18 U.S.C. Sec. 201(c). In short, contractors operating in the United States cannot bribe a public official or offer a gratuity after benefiting from an official act. While bribery is somewhat self-explanatory, what constitutes a gratuity is not always intuitive. Under United States law, an illegal gratuity is any gift to a public official after an official act occurred and does not require any quid pro quo. See United States v. Sun-Diamond Growers of Cal., 526 U.S. 398, 404-05 (1999). Thus, to avoid criminal liability construction professionals should avoid making gifts to public officials in the United States. Otherwise, such professional expose themselves to potential criminal liability.

The FCPA prohibits offering to pay, paying, promising to pay, or authorizing the payment of money or anything of value to a foreign official in order to influence any act or decision of the foreign official in his or her official capacity or to secure any other improper advantage in order to obtain or retain business. The FCPA’s provisions can apply to conduct both inside and outside the United States. Construction entities operating within the United States, even if not domestically incorporated, must be aware of, and comply with, the FCPA. This is because the FCPA applies to foreign nationals or entities that, either directly or through an agent, engage in any act in furtherance of a corrupt payment while in the territory of the United States or that involves interstate commerce (this can be triggered by simply placing a telephone call or sending an email, text message or fax from to or through the United States or by sending a wire transfer from or to a U.S. bank). The law can also reach to officers, directors, employees, agents or stockholders acting on behalf of such persons or entities that are subject to the FCPA.

For example, in one recent case a vendor of air-conditioning, ventilation and refrigeration equipment and services supplier, through its subsidiaries, paid approximately $522,500 to an intermediary who used the funds to pay certain government officials in the UAE. Payments were made to secure contracts related to the construction of a government-owned luxury hotel. Although vendor did not make any of the payments to the UAE officials itself, vendor knew that its intermediary was making the payments on its behalf to secure certain contracts. Vendor made similar payments to obtain contracts in Iraq, Bahrain, Egypt, India, Turkey, China, Nigeria and various other European and Middle Eastern Countries. The payments made by Vendor to its intermediary were recorded as “consultancy payments.”

As a result of these payment, the U.S. Department of Justice and the U.S. Securities and Exchange Commission filed criminal and civil charges against Vendor. Those charges included violations of the FCPA’s anti-bribery provisions, failure to devise and maintain internal controls to prevent and detect violations and failure to accurately record the bribes. Vendor paid $10 million to settle the criminal charges and was required to engage an independent FCPA compliance monitor for a period of three-years. Vendor’s settlement with the Securities and Exchange Commission included disgorgement of $8,949,132 in profits, payment of $1,083,748 in prejudgment interest and a civil penalty of $2 million.
The United States prosecutes bribery and corruption cases aggressively. Construction professional operating in the United States must be sure to comply with such laws. This includes insuring compliance on projects outside the United States. Failure to comply with these laws can result in massive penalties, disgorgement of profits and criminal liability.

Austria Small Flag Austria

Rules in the area of health and safety are found in the Building Codes.

Rules in the environmental area are found in a host of environmental statutes.

Rules in the area of planning are found in the Building and the Regional Planning Codes.

Rules in the area of employment are found in a host of employment codes and collective agreements.

Rules in the area of anti-corruption and bribery are found in the Criminal Code.

Cyprus Small Flag Cyprus

(a) health and safety:

The Local Authority has the right to ask for any drawings, sketches, calculation and any other information which is considered necessary to ensure that the building to be constructed provides for the health and safety of the users. The Local Authority may, through an order, close down any building, which, considers to be prejudicial to health due to e.g. bad ventilation or dangerous due to e.g. structural defects. If the Local Authority determines that a structure is in such a condition as to be dangerous, they may issue an order to the person who has an interest in the use of the structure.

(b) environmental issues:

Every application for a building permit that concerns large projects such as golf courses, marinas and harbours, is accompanied with a valuation of the estimated environmental impact. The valuation must locate, describe and evaluate the direct and indirect impact that the construction may have on any person, the flora, fauna, natural landscape, water, atmosphere, soil, sea and climate.

(c) planning:

Planning applications must be submitted and planning permission obtained from the local Town Planning Authority for all types of development.

(d) employment:

The contractor is obliged to insure its personnel and maintain such insurance in effect throughout the execution of the contract, and shall ensure that its subcontractors shall do the same.

(e) anti-corruption and bribery:

The legal framework against bribery and corruption principally comprises:

  • The Prevention of Corruption Law, Cap 161.
  • The Civil Servants Law, Law 1 of 1990.
  • The Criminal Code, Cap 154.
  • The Law Ratifying the Criminal Law Convention on Corruption, Law 23(III) of 2000.
  • The Political Parties Law, Law 175(I) of 2012.
  • The Law on the Illicit Enrichment of Public Officials and Officers, Law 51(I) of 2004.

All these laws have been amended since they were introduced.

Brazil Small Flag Brazil

(a) health and safety;

In Brazil the Health and Safety are governed by law, rules and regulations spread across all federated entities in Brazil (Federal, State and Municipal). There is not a particular legislation regulating the subject. Ministry of Labour Ordinance No. 3.214/1978 is the closest to a codification at Federal level.

Ministry of Labour Ordinance No. 3.214/1978 compiles the technical notes for work environment such as exposure to toxic chemicals, excessive noise levels, mechanical dangers, heat or cold, or unsanitary conditions, which guidelines are enforced in all States. However, despite the compilation, there are other rules that should be considered when a project is intended in Brazil.

For instance, employers are subject to collect a Labour Insurance on the payroll depending on the risk of the activities employees perform. The nominal rates of such insurance are 1%, 2% and 3%. However, the rate varies (lowered or increased) depending on employer’s performance (i.e. risk mitigation, compliance to law, number of actual labor accidents) in comparison to its peer companies. This is a simple example of the complexity of the occupational environment in general terms.

The example above is restricted to the Federal Level. When the State and Municipal levels are considered, complexity increases exponentially. The major challenge is to comply with all regulation in different levels and the public administration interpretation of such rules to mitigate the risks, consequently mitigating contingencies and reducing employees’ exposure to hazard.

(b) environmental issues;

The Constitution of the Federative Republic of Brazil sets forth a vertical structure in the distribution of legislative competencies: starting from the Union to the States, and from those to the Municipalities. Thus, the Federal norms will always be more generic and abstract than the state norms, and these, in turn, more than the Municipal ones. Norms of either a specific or a supplementary nature must abide the guidelines and principals established by the more general norms.

In such context, Federal Law 6,938 of 1981, laid down the National Environmental Policy and made Environmental licensing mandatory throughout the National territory for activities that are effective or potentially polluting or capable of causing environmental degradation.

Even though the legislation determining licensing is federal, such licenses are usually issued by State environmental agencies and are, thus, subject to State level laws and regulations. Hence, a project in the State of Bahia can have substantially different requirements from a similar project in the State of Paraná.

Environmental licensing process consists of three types of licenses. Each is required in a specific licensing step, but all three are required for a single project:

Preliminary License (“Licença Prévia”)

It is the first stage of licensing and prior to the implementation of the project, in which the Licensing agency assesses the future location and conception of the enterprise, attesting its environmental viability and establishing the basic requirements for the next phases. Complementary environmental studies such as EIA (Brazilian acronym of Environmental Impact Study), RIMA (Brazilian acronym of Environmental impact Report) or RCA (Brazilian acronym of Environmental Control Report) may be required at this stage.

Installation License (“Licença de Instalação”)

Once the initial design is detailed and environmental protection measures are defined, the Installation License must be requested, whose concession authorizes the beginning of the construction of the project and the installation of the equipment.

Operation License (“Licença de Operação”)

The Operating License authorizes the operation of the enterprise and must be required after the environmental agencies verifies the effectiveness of the environmental control measures established in the conditions of the previous licenses.

Finally, it is important to refer to Federal Law No. 9,605 of 1998, which sets forth criminal and administrative sanctions derived from conducts and activities harmful to the environment. Under Brazilian Law, environmental crimes are among the few that may be imposed to legal entities, which penalties vary from heavy fines to either temporary or permanent suspension of activities.

In addition to environmental licenses, there are a number of permits that are complimentary to the environmental licenses and must be obtained to comply to environmental law.

(c) planning;

Considering that federal, state and local government have the concurrent delegation and authority to issue laws in some key matters (i.e. environmental, health and safety, zoning, tax, etc.) it is not difficult to understand the number of possible conflicts that could arise from such a triple legal delegation (legal and territorial). Conflicts are not restricted to zoning laws. The company shall also comply to tax laws, environment laws, among others.

As to mitigate the risk of non-compliance to laws (federal, state and local) it is important to perform studies regarding the feasibility of the project, taking into consideration also the geographic location. Location can be determinant in the economic feasibility of the project, as local laws can impose a huge burden into the project.

(d) employment; and

In Brazil, there are general and complex rules regarding employment. Since 1960 Labour Law and relevant Courts of Law have been over protective to employees. Despite some recent modification in the law and courts’ interpretation of the law, in recent years (Labour Reform), there is room for improvement.

Considering that the construction sector is people-intensive, authorities issued specific rules that governs such sector. For example, in a typical Engineering Procurement and Construction agreement the contractor may register the construction site as an “independent entity” with the authorities in order to limit tax and labour contingencies.

One distinguishing feature of the Brazilian law regarding labour that directly affects people-intensive industries is the subsidiary liability that affects contracting parties. Considering the mixed nature of rights and obligations of the several stakeholders in an EPC Agreement, and that Brazilian law and authorities have a limited understanding of EPC agreements, a thorough analysis of the project and the contracts governing any given project is necessary in order to adapt the already tested and well-known structures of the sector to a specific project.

(e) anti-corruption and bribery.

The Companies’ accountability for corruption (and not only for the individuals) is a rule under improvement in Brazil. Its relevance has been consolidated in the Organization for Economic Cooperation and Development (OECD) Convention on combating Corruption of foreign public officials in international Business Transactions of 17 December 1997, which prescribes the responsibility of Companies’ for the corruption of foreign resources.

In this context, Law No. 12,846, of August 1st, 2013, also known as the Anti-Corruption Law, regulated by Decree 8,420 of 2015, brought some innovations to our legal system, such as:

a) Predicted the possibility of objective liability of companies (regardless of the existence of fault), as a result of acts harmful to the national or foreign public administration;

b) Encouraged prevention, treating differentiated way companies that have an adequate Compliance Program;

c) Established the leniency agreement, benefiting those who collaborate with investigations of Illicit acts, fostering collaboration between companies and the Public Administration.

In such Law, there is no accountability for private corruption, but only in the public sector.

On the other hand, there are other norms existing in Brazilian legislation to curb corruption practices, such as:

  • Criminal Code (Legislative Decree n. 2,848 of 1940)

    The corruption acts are stated in the criminal sphere, such as crimes against the public administration, against the economic order and against the tax order.

    Both Criminal Code and Anti-Corruption Law impose liability for acts against foreign public administrations. The Criminal Code has specific provisions regarding active bribery and influence peddling in international business transactions.

    Money laundering or wrongdoing related to financial statements are punished by specific laws, such as the Tax Crimes Law and the Anti-Money Laundering Law.

  • Administrative Misconduct Law (n. 8,429, of June 2nd, 1992)

    Is the main instrument of repression of corruption for the public officials.

  • Public Officials Law (n. 8,112, of December 11th, 1990)

    Sets forth responsibilities to the public officials who incur in practices related to corruption.

  • The Public Procurement Law (n. 8,666, of June 21st, 1993)

    Establishes rules of public bids, contracts and punishes irregularities practiced by suppliers and contractors.

  • State-Owned Companies Law (n. 13,303, of June 30th, 2016)

    Establishes specific rules for state-owned companies in terms of corporate governance, public tenders and contracts, compliance programs and control by public entities.

It is important to mention, the Supreme Federal Court declared on September 17th, 2015 the unconstitutionality of political contributions from domestic or foreign companies to political parties or candidates.

Brazil has ratified several conventions related to corruption, including:

  • Convention on combating Corruption of foreign public officials in international Business Transactions of 17 December 1997 of Organization for Economic Cooperation and Development (OECD) (Decree n. 3,678, of November 30th, 2000);
  • The Inter-American Convention against Corruption (Decree n. 4,410, October 7th, 2002);
  • The United Nations Convention against Transnational Organized Crime (Decree n. 5.015, of March 12th, 2004);
  • The United Nations Convention against Corruption (Decree n. 5,687, of January 31st, 2006).

Finally, during car wash operations, Brazil has signed several cooperation agreements with other countries to fight against corruption and bribery.

Ireland Small Flag Ireland

(a) health and safety;

Regulation of health and safety is addressed mainly in a statutory framework, and failure to discharge the statutory duties can carry criminal sanction, including fines of up to €3 million and/or imprisonment for up to two years for convictions on indictment. The following contain the core health and safety legislation relevant to construction:

  • Safety, Health and Welfare at Work Act 2005, which imposes core duties on all employers to ensure, so far as is reasonably practicable, the health and safety of their own employees and of third parties, including employees of others and members of the public.
  • Safety, Health and Welfare at Work (Construction) Regulations 2013.
  • Safety, Health and Welfare at Work (Asbestos) Regulations 2006 to 2010.
  • Safety, Health and Welfare at Work (General Application) Regulations 2007 to 2016.

These regulations set out more detailed duties in respect of certain activities and in respect of the use of certain equipment, and provide for the management of specific risks.

The Safety, Health and Welfare at Work (Construction) Regulations 2013 require the appointment of duty holders responsible for specific functions to ensure that construction projects are planned, designed, and executed taking health and safety into account during the design and construction phases, and in subsequent use of the completed project.

Duties are also imposed on parties procuring construction works, and on both designers and contractors involved in construction work

(b) environmental issues;

Environmental policy in Ireland is largely driven by, and derived from EU policy on the environment. Environmental law in Ireland is administered, regulated and enforced mainly by local authorities, such as County Councils, and by the Environmental Protection Agency (“EPA”). Water services functions of local authorities (including prosecutorial powers in respect of certain water services matters) were transferred to Irish Water, a semi-state company established in 2013. The EPA licenses major industry (in addition to any other development consents required) purely with regard to environmental discharges, emissions and waste handling.

The consideration of environmental assessment to be carried out in respect of a project is generally the subject of consideration at an early stage of project development. Under Directive 2011/92/EU (as amended by Directive 2014/52/EU), and Ireland’s planning legislation generally, an environmental impact assessment (an “EIA”) is required at the development stage of all projects that are likely to have a significant impact on the environment. In addition, an appropriate assessment pursuant to the Habitats Directive may be required where a project is likely to have a significant effect on a European Site (i.e. special protection area or special area of conservation).

(c) planning;

Planning and development of infrastructure projects are governed primarily by the Planning and Development Acts 2000–2018 (the “Planning Acts”) and the Planning and Development Regulations 2001 to 2018. The general rule in Irish planning law is that all development, not being exempted development, requires planning permission. “Development” is widely defined in the Planning Acts to include both works of development and material changes of use.

Local authorities deal with planning matters, including the grant of permission (also including conditions for minor environmental matters) for day-to-day development, subject to appeal to An Bord Pleanála (“ABP”). More significant development consent applications of a strategic nature are made directly to ABP. A grant of planning permission will contain conditions relating to both the construction of a development, as well as its continued operation or use. Enforcement proceedings may be taken by a local authority or any third party (including members of the public) in respect of a failure to comply with planning permission.

(d) employment; and

The Employment Equality Acts 1998 to 2015 prohibit discrimination on nine grounds, namely gender, civil status, family status, age, race, religion, disability, sexual orientation and membership of the Traveller community. Most employment equality issues are dealt with by the Employment Equality Acts, including: discriminatory dismissal, equal pay, harassment and sexual harassment, working conditions, promotion, access to employment, etc.

Under the Unfair Dismissals Acts 1977 to 2015, an employee who has worked for their employer for more than one year is entitled to rely on the legislation to challenge a dismissal as being unfair. Under the Unfair Dismissals Acts, a dismissal is deemed to be unfair and the onus is on the employer to establish otherwise. The remedy which may be sought or awarded in the case of unfair dismissal is reinstatement, re-engagement and/or compensation of up to a maximum of two years’ remuneration.

The current system for resolving workplace disputes has existed in Ireland since 2015. The Workplace Relations Act 2015 replaced the previous system of multiple employment tribunals with a two-tier structure for claims, namely: (i) the Workplace Relations Commission (“WRC”), which deals with complaints at first instance by means of a hearing before an Adjudication Officer, and (ii) the Labour Court, which deals with all cases on appeal. In addition, employees have access directly to the Courts in some circumstances.

The National Minimum Wage Act 2000 introduced a statutory minimum wage, which, as of 1 January 2019, is €9.80 per hour, and changes frequently. With effect from 19 October 2017, the Construction Sector is subject to a Sectoral Employment Order (“SEO”). The SEO applies to all Building Firms and Civil Engineering Firms as defined in the order. The SEO makes it compulsory for Building Firms and Civil Engineering Firms to (i) pay construction workers the rates of pay provided in the order and to (ii) provide a pension and sick pay scheme for the categories of workers as defined in the order. The SEO also contains a dispute resolution procedure to be utilised in the event of a dispute arising over a term in the order.

The Organisation of Working Time Act 1997 provides for minimum annual leave entitlements, work breaks, daily and weekly rest periods and a maximum working week of an average of 48 hours calculated over a reference period of, usually, four months.

Employers’ data protection obligations are set out in the Data Protection Act 2018. This implements the General Data Protection Regulation which has been law in Ireland since 25 May 2018 and imposes onerous burdens on employers as data processors and controllers.

The Protected Disclosures Act 2014 provides a robust statutory framework within which workers in the public and private sector can disclose information regarding potential wrong-doing in their workplace, and significant employment and other protections to prevent such workers suffering penalisation or detriment following the making of a disclosure. “Workers” is given a very wide definition and includes permanent and temporary employees, former employees, secondees, interns, consultants, contractors and agency personnel. The types of wrongdoing covered by the Protected Disclosures Act specifically includes things like the commission of offences, the failure to comply with legal obligations, health and safety issues and damage to the environment. An employee who is penalised by his or her employer for having made a protected disclosure, or an employee who is dismissed as a result of having made a protected disclosure, may claim up to five years’ remuneration from his or her employer.

The EU Posted Workers Directive (“PWD”) is applicable to circumstances where employers send workers who normally work in another EU Member State but, for a limited period, are sent by their employer to carry out their duties in another EU Member State (“posted workers”). The PWD guarantees posted workers an entitlement to minimum terms and conditions of employment and as such this individual would acquire Irish employment law rights. Furthermore, the PWD and the Irish transposing regulations provide that employers who post workers to Ireland are obliged to make a declaration to the WRC prior to the date the posted worker commences providing services in Ireland. The regulations provide that the declaration must be made in the prescribed form and contain the following information: identity of service provider; number of posted workers; duration of the posting; address of posted workplace; and the nature of services. Neither the regulations nor the PWD prescribe a minimum posting period which triggers this reporting obligation.

(d) anti-corruption and bribery.

Where a contract is obtained illegally in Ireland, a court can set aside the award of that contract. Irish law generally prohibits bribery not just by persons employed or acting for the state but also by private individuals. This is unusual in that other jurisdictions generally make a distinction between persons employed by or working for public bodies and those working for private companies. The exception to this is in relation to a presumption of corruption, which arises in certain circumstances under the Prevention of Corruption Acts 1889–2010 and the National Asset Management Agency Act 2009. The Ethics in Public Office Acts, 1995 and 2001, provide for members of the Irish public, office holders and senior members of the public service to report and surrender gifts or payments with a value over €650. Bribery is also an offence under Irish common law, although prosecutions in recent times are more usually brought for statutory offences.

Under the Prevention of Corruption Acts 1889–2010, a person or agent for another person is guilty of an offence where they ‘corruptly’ (which is not defined) ‘accept or agree to accept, or agree to obtain a gift, for him or herself or another person as a inducement, reward or on account of the agent doing or making any act, or making any omission in relation to the agent’s position or his or her principal’s affairs or business’. In a similar vein, it is also an offence for a person to corruptly give such a gift. A person may also be guilty of committing either active or passive corruption under the Criminal Justice (Theft and Fraud Offences) Act 2001.

A person found guilty of corruption or the offence of corruption in office is liable on summary conviction to a fine of €4,000 or 12 months in prison, or both. A person convicted on indictment is liable for a potentially unlimited fine and 10 years in prison. A person convicted under the Criminal Justice (Theft and Fraud Offences) Act 2001, will be liable for a potentially unlimited fine and up to five years in prison.

Mexico Small Flag Mexico

(a) health and safety;

The “NORMA Oficial Mexicana NOM-031-STPS-2011, Construcción-Condiciones de seguridad y salud en el trabajo.” (Official Mexican Standard NOM-031-STPS-2011 Construction- Safety and Healthy conditions in work projects”) applies to the construction works in connection the Health and Safety. These NOM is available in the following link:

(b) environmental issues;

The “Ley General del Equilibrio Ecológico y la Protección al Ambiente” (General Law of Environmental Balance and Environment Protection) applies to all the country. However, it must be kept in mind that every State might have specific regulations in environmental matters.

(c) planning;

The specific planning laws and regulations will depend on each State, since every State has the independence to determine itself issues regarding the kind of land and type of buildings are allowed.

(d) employment;

Laboral law is a federal matter, so the Federal Labour Law (“Ley Federal del Trabajo”) applies in all the country and has specific provisions on construction. Also the IMSS LAW (Mexican Social Security Law) that regulates the social security system, has important impact on the workforce of construction projects on Employers, Contractors and Subcontractors.

(e) anti-corruption and bribery.

The General Law of Administrative Liabilities (a Federal law) and the Criminal Code (Federal and the one applicable to each State) establish the conducts that are considered corruption actions that are sanctions for individuals and companies including the ones related to construction projects.
The sanctions derived from the General Law of Administrative Liabilities have administrative nature being among others, debarment, fines, liquidation of companies, while the Criminal sanctions are jail and/or fines.

Additionally, in 2013, the Federal Constitution was amended in monopolistic and competence issues. Since then, it is important to consider the Antitrust Legislation mostly in public projects, since the Cofece (Federal Commission of Economic Competence) has the faculty to review binding processes, and if some companies intend to participate in a consortium or if the participation of some companies imply prior mergers or acquisitions from one company to another, it becomes important to review the Antitrust Lay in order to clarify if such transaction is needed to be notified to the Cofece.

United Kingdom Small Flag United Kingdom

1. Health and safety

The Health and Safety at Work Act 1974 sets out the basic health and safety duties of a company, its directors, managers and employees. Extensive obligations are imposed on employers, and individual director and company officers can be held criminally responsible for health and safety offences. Under the Corporate Manslaughter and Corporate Homicide Act 2007 companies can be convicted of corporate manslaughter.

The Construction (Design and Management) Regulations 2015 affect most construction projects in the UK. Their main purpose is to ensure that the employer appoints competent consultants and contractors, and a Principal Designer, although duties are imposed on all the main participants.

2. Environmental

There is a trend towards increasingly stringent environmental controls, largely through the adoption of EU legislation. The main environmental law regimes address contaminated land, water pollution, nuisance, permitted emissions, waste, asbestos, the EU Emissions Trading Scheme, various energy efficiency measures and protection of biodiversity, habitats and wildlife.

BREEAM is the Building Research Establishment’s Environmental Assessment Method, which sets best practice standards for the environmental performance of buildings through design, specification, construction and operation. Although not compulsory, many developers, local planning authorities and government projects may require BREEAM certification (or equivalent) for new or refurbished buildings.

3. Planning

Any “development” of land under the Town and Country Planning Act 1990 (including a change in use) requires planning permission.

Applications must be submitted to the local planning authority or the Secretary of State. An application must be decided within 8, 13 or 16 weeks depending on the nature of the development and whether an environmental impact assessment is required. If granted, planning permission may be subject to certain conditions, obligations or a “community infrastructure levy”.

If planning permission is refused, the applicant has the right of appeal to the Secretary of State. A grant of planning permission cannot be appealed, but a defective decision can be challenged by way of judicial review within six weeks of the decision.

Planning applications for “nationally significant infrastructure projects” are examined by the Planning Inspectorate, which provides a recommendation to the Secretary of State as to whether a development consent order (DCO) should be granted. Certain developments have their own hybrid Act of Parliament, such as the Crossrail Act 2008.

4. Employment

Subcontracting is rife throughout the construction industry. Subcontractors are generally accepted to be independent contractors rather than employees, so contractors will not have vicarious liability for the negligence of a subcontractor where it carries out the work for which it was engaged, unless, exceptionally, it can be shown that there was a relationship analogous to employment.

Where there is a service provision change or a transfer of all or part of an undertaking, for example where a developer changes contractor, brings the work in-house or outsources various works and services, the Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE”) may apply. Employees automatically transfer across into the employment of the transferee, there are obligations to inform and consult with representatives, and employees have enhanced protection against dismissal.

The Modern Slavery Act 2015 requires large commercial organisations that operate in the UK and have a turnover of £36 million to prepare an annual statement setting out what steps have been taken to ensure that their business and supply chain are free from slavery and human trafficking.

5. Anti-corruption and bribery

The Bribery Act 2010 captures offences committed by anyone inside the UK. For people or companies with “a close connection with the UK”, the Act extends to the same offences committed outside of the UK.

The four main offences are bribing another person, being bribed, bribery of a foreign public official, and failure of a commercial organisation to prevent bribery. Where the Act is breached, the consequences can include potentially unlimited fines, up to ten years’ imprisonment, and debarment from competing for public contracts.

Spain Small Flag Spain

In terms of health and safety, the current legislation on the prevention of occupational risks must be applied, mainly integrated by Law 31/1995, of November 8th, on the prevention of occupational risks, and all its regulatory development - in particular, Royal Decree 1627/1997, of September 5th , approving the minimum health and safety regulations for construction works.

In environmental matters, the current legislation on environmental assessment must be applied, integrated by Law 21/2013, of December 9th, on environmental assessment. In its annexes are defined the works subject to ordinary environmental evaluation - Annex I - simplified environmental evaluation - Annex II - and strategic environmental study - Annex IV -. Each Autonomous Community has developed its own regulations that specify and extend the state regulations.

In terms of planning, with respect to buildings, the regulations require a basic project - sufficient to obtain a building permit - and an execution project - necessary for obtaining a first occupation license.

Regarding an infrastructure, it is necessary to comply with the regulatory sector norm of each infrastructure, which defines the content of the projects and professional competence for its drafting.

Regarding employment, the labor legislation of the State is applicable, integrated by Royal Legislative Decree 2/2015, of October 23rd, which approves the Consolidated Text of the Workers' Statute Law.

In terms of anti-corruption and bribery, the Penal Code is applicable, approved by Organic Law 1/2015, of March 30th. Also applicable is Law 10/2010, of April 28th, on the prevention of money laundering and financing of terrorism, which obliges the authorities to inform of any action suspected of laundering capital of criminal origin.

Turkey Small Flag Turkey

(a) health and safety;

With respect to the issue of health and safety, the Occupational Health and Safety Act numbered 6331 (“OHSA”) and the Regulation on Occupational Health and Safety (official journal date 09.12.2003 and number 25311) impose a number of obligations on employers. These include (i) taking necessary measures (in terms of training the employees setting up an appropriate organisation, providing the necessary tools) to prevent occupational hazards, (ii) supervising on exercising the health and safety rules, (iii) conducting (or having others to conduct) risk analysis, (iv) taking their employees’ health conditions into consideration when assigning them to a duty (v) taking the required measures to prevent those who have not been properly instructed to enter into areas which pose risks to their lives and health. Furthermore, Regulation on Health and Safety in Construction Works (official journal date 05.10.2013 and number 28786) includes more specific health and safety requirements applicable to construction works.

(b) environmental issues;

In terms of environmental issues, according to the Environment Act numbered 2872 (“EA”), (i) those generating waste as a result of their activities must manage their waste according to the EA and the relevant regulations, (ii) if a prospective project may have adverse effects on the environment, an environmental impact assessment must be conducted, (iii) emergency plans must be prepared and applied regarding protection of the environment in certain circumstances, and (iv) the noise and vibration levels set out in the regulations must be complied with. Management of excavation soil and construction debris is specifically regulated under the Regulation on Control of of Excavation Soil, Debris and Wreckage (official journal date 18.03.2004 numbered 25406).

(c) planning;

Construction permit is required for all sorts of construction/renovation operations (except for those minor works which are exhaustively mentioned in the Zoning Law) in accordance with the Zoning Law numbered 3194. When applying for construction permit, architectural projects, static projects, electrical and installation projects, representations and calculations, benchmark sketches or if that is not available, dimensioned sketches must be submitted. If these are not compliant with the development plan of the place where the construction is to take place, as well as the Zoning Law, Planned Zones Development Regulation (official journal date 03.07.2017 and numbered 30113), and other relevant regulations such as the Regulation as to Protection of Buildings from Fire (official journal date 19.12.2007 and numbered 26735) then the construction permit will not be issued. After the construction permit is issued, the conduct of the works must comply with the construction permit and its appendices.

(d) employment; and

On the employment aspect of the construction and engineering projects, the Labour Act numbered 4857 (“LA”) is the main legal instrument governing the key obligations of those who employ workers. According to the LA, employers’ obligations include treating their workers equally, allowing them to take leave as contemplated in the LA, making overtime payments if their workers do overtime work, making timely payments of the workers’ remunerations and social security premiums, taking the required measures to ensure health and safety of the workers and so on.

(e) anti-corruption and bribery.

Turkish law deals with the issue of anti-corruption and bribery mainly as a matter of criminal law. Turkish Criminal Code numbered 5237 defines bribery (section 252), corruption (section 250) and embezzlement (section 247) as criminal offences. Imprisonment or judicial fines contemplated under the Turkish Criminal Code can only be applied to real persons—cannot be applied to corporations or other judicial persons (section 20/2). However, judicial persons may face certain ‘security measures’ if their officials commit a crime. These security measures are (i) cancellation of the corporation’s licenses if it is operating under a license granted by a public authority and/or (ii) seizure of the things used for or generated out of the crime (section 60). Furthermore, Misdemeanours Act numbered 5326 contemplates an administrative fine in case when the crime of bribery is committed for the benefit of a corporation (section 43/A). This administrative fine can be up to 2.000.000,00 TRY for each offence.

South Africa Small Flag South Africa

(a) health and safety;

As set out above, employers, designers and contractors attract extensive health and safety obligations in line with international standards that are regulated by the OH&S Act and the Construction Regulations. Specifically, the Construction Regulations provide for, inter alia:

(i) the health and safety specifications for the intended construction work.
(ii) the development of a health and safety plan by the contractor, setting out minimum safety requirements and measures to be put in place to ensure implementation; and
(iii) periodic health and safety audits.

(b) environmental issues;

There are a number of statutes that govern environmental issues related to construction and engineering projects. In particular, parties should be aware of:

(i) The National Environmental Management: Air Quality Act 39 of 2004, which regulates national norms and standards for air quality monitoring, management and control, including the regulation of dust emissions on construction projects;
(ii) The National Water Act 36 of 1998, which provides strict liability provisions in the event of water contamination on-site or off-site, and requires a contractor to take positive steps to prevent water pollution;
(iii) The Environment Conservation Act 73 of 1989, which regulates waste management and the issuing of permits for the establishment or operation of waste disposal sites; and
(iv) The National Environmental Management Act 107 of 1998, which provides a list of activities that cannot be carried out without an environmental authorisation, including ground clearing activities.

(c) planning;

The National Building Regulations and Building Standards Act 103 of 1977 (“NBRBAS”) provides that all building plans must be approved by the local authority.

(d) employment; and

While there is no specific legislation applicable to employees in the construction sector, South Africa has a comprehensive legislative framework which governs employment more generally. This legislation includes:

(i) the Basic Condition of Employment Act 75 of 1997, which sets out basic conditions of employment to be provided by employers;
(ii) the Labour Relations Act 66 of 1995, which, inter alia, governs collective bargaining and sectoral minimum wage agreements in addition to prohibiting employees from being unfairly dismissed and subjected to unfair labour practices by employers; and
(iii) the Immigration Act 13 of 2002, which regulates the employ of foreign nationals in South Africa.

(e) anti-corruption and bribery

The Prevention and Combating of Corrupt Activities Act 12 of 2004 (“Corrupt Activities Act”), prohibits various corrupt actions and practices across all industries, including the construction industry. More specifically, the Corrupt Activities Act sets out offences for corrupt practices involving public officials, tenders and contracts.

In addition, the CIDB has published a code of conduct for all parties engaged in construction procurement (“CIDB Code”). The CIDB Code provides a set of standards against which a party’s actions in a procurement process may be assessed. In an effort to curb and prevent corrupt practices, the CIDB Code provides that an agent, contractor, employer, employee, or subcontractor, may not accept gifts, favours or anything of any nature that is of more than token value, from another party involved in that procurement process. Additionally, the CIDB code provides that parties may not engage in unfair or unethical practices.

France Small Flag France

(a) health and safety;

French law provides for numerous regulations, set notably by the French Labor Code (Code du travail), in relation to health and safety applicable to construction and engineering projects. These rules provide for obligations for all the parties involved in the project, including the consultants, the contractors and even the project owner himself.

They include, inter alia:

  • the obligation for the project owner to appoint, from the design stage, a specific consultant, the health and safety coordinator (Coordonnateur Sécurité-Protection-Santé), who will be in charge of the coordination of the different contractors involved on the project for health and safety issues,
  • numerous health and safety prescriptions to be applied by the contractors on the work site to protect the workers,
  • the obligation for the project owner to have a specific maintenance file (dossier d’intervention ultérieure sur l’ouvrage) issued after completion of the works.

Non-compliance with health and safety regulations can constitute a criminal offence sanctioned by the Criminal Code (Code Pénal).

(b) environmental issues;

Environmental regulations provide for several obligations, which will depend on the type of projects. For instance:

  • building construction projects in France have to comply with thermic regulations (the so-called RT 2012 regulations), aiming to optimize the energy consumption of the future building;

  • some projects (especially industrial or logistic projects) are subject to regulations relating to facilities classified for environmental protection (installations classées pour la protection de l’environnement - ICPE). These regulations will depend on the type of activity that will be carried out within the project after its completion. These rules entail, inter alia, an obligation to secure a prior declaration or authorization prior to the start of construction works and of the operation of the project;
  • several types of mandatory environmental assessments, declarations or authorizations may also be applicable to a construction project, depending on whether such project will have an impact on the environment, agricultural land, biodiversity, or the aquatic environment;
  • depending on the use contemplated for the project, existing site conditions with respect to pollution may lead to removal and/or monitoring obligations;
  • obligations apply in case of works to be performed in a site containing hazardous materials (such as asbestos). This includes the obligation to perform specific diagnostics prior to the start of the works and to comply with specific regulations for the performance of the works.

Apart from these mandatory provisions, it is now a market practice for owners of real estate project in France to pursue environmental certifications for their buildings. This is an additional source of environmental prescriptions for the construction, as the certifications will only be obtained if the building meets the environmental standards and criteria set by the certifying authorities.

(c) planning;

Town planning rules under French law include national and local rules. Most cities in France have a local urban planning plan (Plan local d’Urbanisme or PLU) which will provide for the local planning rules that each construction project will have to comply with.

Compliance with town planning rules are subject to a prior control by the authorities: indeed, construction works are subject to the prior obtaining of town planning authorisations (generally a building permit to be issued by the City).

After its issuance and for a limited period of time, a building permit can be subject to claims from third parties or from the Prefect (local representative of the French State) and to a withdrawal right from the City.

(d) employment;

French law provides for a body of very strict labor rules relating to employment contracts (type and content of the employment contract, duration, dismissal, etc.), health and safety and fight against illegal work.

Specific regulations have also been adopted to control and regulate the use of “posted workers” employed by foreign contractors but who are temporarily assigned to work on a project in France. These regulations bind the contractors themselves, but also the project owner, who has specific control obligations in this respect.

Compliance with employment regulations is controlled by labor inspectors, who are government officials with the authority to proceed to on-site controls of work sites.

(e) anti-corruption and bribery.

French law provides for strict anti-corruption and bribery rules and sanctions, especially with respect to public projects, which were recently reinforced by the so -called “Sapin 2” law dated 9 December 2016.

These rules include, inter alia, the obligation to organize public tenders for the procurement of public construction contracts (the type of tender will depend on the amount of the project).

We also witness a trend to provide for express anti-corruption and bribery provisions in contracts for private projects, especially for projects involving international investors subject to US or UK regulations.

Sweden Small Flag Sweden

(a) health and safety;

The Work Environment Act (1977:1160) contains obligations for inter alia employers to prevent accidents and illness. Furthermore, the act stipulates that a person who orders the execution of building or construction works is responsible for the coordination of the work environment. To comply with this obligation, the employer must prepare a work environment plan and appoint a work environment coordinator for the planning/design phase as well as the construction phase. It is common and possible to delegate the obligations.

In addition to the above, the Work Environment Act provides that construction works shall be planned and executed with care, in order to make sure that persons or property are not damaged.

(b) environmental issues;

According to the Environmental Code (1998:808), the general rules of consideration (Sw. hänsynsreglerna) must be complied with when executing construction works. The rules inter alia provide that the person executing the construction works must possess and use the knowledge required to protect the health of people and the environment. Moreover, the employer is responsible for any negative effects that may come as a result of the construction.

(c) planning;

The Planning and Building Act (2010:900) is the main source of legislation in relation to planning in construction projects. When executing construction works, it is necessary to adhere to legislation concerning building, ground or demolition permits, as well as municipal zoning plans.

(d) employment; and

Sweden has numerous acts on the field of employment. One of the more important ones is the Employment Protection Act (1982:80), which inter alia contains the legal framework for the termination and allowed forms of employment.

In addition to this, Sweden has a long tradition of self-regulation regarding employer conditions and many companies have collective labour agreements. Foreign companies that do not have collective labour agreements or fail to comply with the Employment Protection Act are sometimes subject to blockades etc.

(e) anti-corruption and bribery.

The Penal Code (1962:700) stipulates that bribery is a criminal offence. Sweden is widely considered to be one of the least corrupt countries in the world.

Denmark Small Flag Denmark

(a) health and safety;

The Danish Working Environment Act and government orders issued thereunder set out health and safety requirements for carrying out work.

For almost any construction work, the employer is responsible for appointing one or more working environment coordinators and for ensuring that they prepare and continually update a health and safety plan for the work. The purpose of the health and safety plan is to identify risks and to establish measures to prevent injuries at the work site.

Where health and safety requirements are not adhered to, the Danish Working Environment Authority can issue specific orders on how to carry out the work and also bring the work to a stand-still until the issue has been corrected.

(b) environmental issues;

Danish legislation on environmental matters is wide-ranging and complex, but is in general based on EU legislation.

Most aspects will typically be handled during the planning stage, but a wide range of polluting activities or activities that include such risks require specific permits. Some projects require an Environmental Impact Assessment, which can be a costly and time-consuming process.

(c) planning;

In general, specific requirements for how constructions must be built are set out in building regulations, whereas the planning legislation sets the framework for where constructions can be built.

The municipalities are responsible for the physical planning of both cities and rural areas in accordance with the development plans. Local development plans can also set out certain requirements for how constructions must be built, e.g. that roofs of houses within an area must be red. In terms of larger projects, it is common (but not required) that a project-specific local development plan is made in close cooperation between the developer and the municipality. Such project-specific plans are usually very detailed in terms of how the construction must be built.

(d) employment; and

In Denmark trade unions have the right to negotiate collective agreements with employers and employers’ organisations, which set out basic working conditions in the business or industry.

There is no legal requirement for a company to follow or enter into a collective agreement, but trade unions can and may decide to take industrial action, such as striking, in order to persuade a company to reach an agreement.

Foreign companies working in Denmark must notify the Register of Foreign Service Providers (RUT).

Many public authorities and other public sector employers include in construction contracts social clauses (e.g. requiring that contractors employ a certain number of apprentices) and labour clauses (e.g. requiring that all workers are entitled to working conditions similar to those set out in collective agreements). They may also include chain liability clauses (stating that the main contractor is responsible and liable for the compliance of sub-contractors (of any tier) with labour clauses).

(e) anti-corruption and bribery.

The Danish Competition Act prohibits agreements and conduct that directly or indirectly restrict fair competition and trade, such as market sharing and price-fixing.

An unlawful act may result in prison, a fine and/or quarantine (a ban on bidding on tenders made by a public entity for a duration of time). EU legislation will apply instead of the Danish Competition Act in cases with cross-border dimensions.

South Korea Small Flag South Korea

(a) Health and safety:

- The principal source of health and safety standards for construction projects is the Occupational Safety and Health Act.

- The Housing Act, the Building Act, and the Framework Act on the Construction Industry (among various other statutes and local regulations) require construction projects to ensure compliance with applicable health and safety regulations, and may also impose additional requirements for specific types of projects.

(b) Environmental issues:

- A number of statutes apply to ensure environmental protection in the course of construction projects. These include:

  • The Clean Air Conservation Act;
  • The Noise and Vibration Control Act;
  • The Water Quality and Ecosystem Conservation Act
  • The Sewerage Act; and
  • The Waste Control Act.

- Sponsors of construction projects may be required to undertake environment impact assessments prior to commencement, in accordance with the requirements of the Environmental Impact Assessment Act.

(c) Planning:

- When planning a construction and engineering project, parties should be aware of the planning requirements under various statutory regulations, including the National Land Planning and Utilization Act and the Urban Planning Act. Certain projects may also be subject to more specific planning laws. For example, projects in the Incheon Free Economic Zone may be subject to the Special Act on the Designation and Management of Free Economic Zones.

(d) Employment:

- Employment in construction projects is regulated by the Labor Standards Act and the Minimum Wage Act. More specific aspects of labor law in relation to construction projects are covered by the Act on the Employment Improvement, etc. of Construction Workers.

- Korean law recognizes a constitutional right to unionize. Various construction labor unions exist under the Korean Federation of Construction Industry Trade Unions. Rights and obligations relating to labor unions are governed by the Trade Union and Labor Relations Adjustment Act.

(e) Anti-corruption and bribery:

- Corruption and/or bribery involving public officials is prohibited under the Criminal Act. In general, directors and officers of public corporations and government-controlled entities are considered to be public officials. In 2016, Korea also promulgated the Improper Solicitation and Graft Act, which considerably broadened the scope of Korean anti-bribery laws.

- Bribery among private individuals is also prohibited by the Criminal Act, which makes it a crime for a person to receive property or a pecuniary advantage from a third person in response to an illegal solicitation concerning his or her duty. For the construction industry in particular, Article 38-2 of the Framework Act on the Construction Industry prohibits bribery between the participants in a construction project.

Updated: June 3, 2019