Gary Lewis's presentation on Guiding principles of CDM 2007 and its application to Joint Ventures in the Wind Energy Sector - exclusively presented to ARMSA Wind Energy clients on Breakfast Seminar on 30 October 2013 and now available to public.

1. The Construction (Design & Management)
Regulations 2007 (“CDM”)
Understanding the role of CDM
Regulations in the UK legal landscape
39 Offices in 19 Countries

2. Why do we need the CDM Regulations?
• The CDM Regulations recognise that construction work is
challenging and dynamic and therefore difficult to manage from a
risk management perspective.
• In terms of the effective management of construction projects the
CDM Regulations concentrate on:
 Planning
 Co-operation
 Co-ordination
 Competency
2

3. CDM 2007
• ADDRESSING IDENTIFIED DEFICIENCIES OF CDM 1994
• Health and safety management an integral part of project –NOT
AN AFTERTHOUGHT or BOLT-ON EXTRA
• Restore client to pivotal role in chain of command
• Improve planning and management of health and safety of
projects from the start and throughout the project
• Identify and eliminate/reduce risks at the design stage
• Sequential approach to appointments to ensure “the right
people get the right information at the right time”
• Prescriptive competence assessment criteria
3

4. Context
A mistake to view CDM 2007 in isolation
4

5. The bigger regulatory picture
• CDM 2007 supplements other health and safety legislation
• Health and Safety at Work etc. Act 1974 (“HSWA”)
• Management of Health and Safety at Work Regulations 1999
(“MHSWR”)
5

6. HSWA
General duties on employer
Section 2 – devise and implement safe systems of work, so far as
is reasonably practicable, in respect of own employees
Section 3 – conduct business activity in such a way as is safe, so
far as is reasonably practicable, in respect of non employees
(contractors or members of public)
6

7. MHSWR
Regulation 3 Regulation 5 -
Arrangements
Regulation 7 -
7
Risk Assessment
Competent person provision

8. Context
A mistake to think that CDM 2007 only applies to conventional
“bricks and mortar” projects.
NOTE: The very wide definition of “construction work” –
Regulation 2
8

9. CDM 2007
Notification criteria:
• Projects (other than for a domestic client) notifiable if:
 30 working days; or
 500 person days
9

10. CDM 2007
If project notifiable, additional duties are imposed on duty holders
under Part 3
N.B.
10
Remainder of slides assume the duties will be those
imposed by Part 3

11. CDM 2007
The Client
• Pivotal role in terms of management of construction project
• No scope for Client to appoint agent
• More than one client – can elect one client as only client
(paragraph 42 of ACoP)
Client Appointments
• Default provision – Regulation 14(4)(a)
 CDCM
 PC
11

12. CDM 2007
CDM Co-ordinator (“CDMC”)
• Early appointment
• No designer shall commence work unless appointed
• Advise client in respect of client duties
• Co-ordinate the design function
• Facilitate good communication between client, designers, PC
and contractors
12

13. CDM 2007
Onerous responsibilities on Designer
• Eliminate or reduce the risks at design stage
• Design project specific
• Provide information about remaining risks
• Lead designer (paragraph 48 of ACoP)
13

14. CDM 2007
Principal Contractor
• There can only be one Principal Contractor at any one time
• Planning, management and monitoring of activity during
construction phase
• Should have input at design stage
• Competency is key
14

15. CDM 2007
Appointments – all parties
• Appointees should not allow themselves to be appointed if not
competent
• Appointers should vet competency of appointee
• Competence should be project specific
• Beware multiple role holders
15

16. CDM 2007
Early collaborative approach between:
• Client
• Designer
• CDM Co-ordinator
• Principal Contractor
16

17. CDM 2007 – General Consideration
1. Does project involve “construction work”? (Regulation 2)
2. If so, CDM provisions need to be incorporated into contractual
provision
3. CDM roles and responsibilities need to be implemented in
terms of practical delivery of project
17

18. CDM 2007 – Guiding Principles
Liability will be commensurate with a party’s level of control as:
1. Duty holder
2. Contractual provision
3. Actual control in terms of dictating system of work etc.
18

19. CDM 2007 – Guiding Principles
• Level of control should be aligned with the roles and
responsibilities envisaged by health and safety legislation
• Exercising too much or too little control will increase liability
• Getting level of control correct is key to managing liability risk
19

20. Joint Ventures – What the HSE say:
There may be occasions when two or more companies combine their
resources to carry out a joint venture. This can take different forms:
1. Each individual company carries out a separate contract
although they may co-operate for administrative or organisational
purposes.
Each company would be liable for its own contraventions and could therefore
be prosecuted in its own name without reference to any of the other companies
involved.
2. The companies involved contribute resources to the formation of a
new company for the purpose of the joint venture.
This separate company is a legal person which can be prosecuted in its
corporate name.
3. The companies involved conduct the venture under a business
name without forming a new company.
20
This will constitute a partnership in which the companies are the partners. They
will be jointly and severally liable for contraventions arising from the venture.

21. The Joint Venture (“JV”)
A question of timing –
At the time the parties are deciding whether to enter into a joint
venture and what type of joint venture they should consider how
that organisation will align itself with CDM arrangements.
21

22. The JV
Will the JV be the client?
Yes if incorporated JV, but not necessarily if unincorporated JV.
Will a party to JV also be a CDM role holder?
This is the time to consider the commercial arrangements and the
health and safety arrangements, in particular CDM framework, in
tandem.
22

23. The JV
Sequential approach with commercial considerations as driver and
health and safety (CDM) as passenger is contrary to one of main
stated objectives of CDM namely:“Health and safety management should be an integral part of the
project NOT AN AFTERTHOUGHT OR BOLT ON EXTRA”
23

24. Jurisdiction
JURISDICTION DICTATES THE RELEVANT REGULATORY
FRAMEWORK
The Health and Safety at Work etc. Act 1974 (“HSWA”)
(Application outside Great Britain) Order 2013 (“the Order”) came
into effect on 6 April 2013
See also Offshore Information Sheet No1/2013.
24

25. Jurisdiction
Purpose of the Order:
consolidate 2001 and 2011 orders “to maintain HSE’s ability to
regulate work activities and ensure statutory protection is extended
to workers and work activities associated with ‘energy
structures’ (wind farms) which are being built beyond the
Territorial Sea within the Renewable Energy Zone.
25

26. Jurisdiction
Article 9 of the Order
1. The prescribed provisions of HSWA apply to within: a) The Territorial Sea – 12 nautical miles adjacent to and measured
from the UK coastline
or
b) A Renewable Energy Zone – (introduced by 2011 Order)
in relation to any ‘energy structure’.
2. ‘Energy Structure’ – a fixed or floating structure or machine,
other than a vessel, which is, or is to be, or has been, used for
producing energy from water or wind.
* 2013 revision to 2001 definition
26

27. Renewable Energy Zone
UK Territorial Sea
Internal water
27

28. UK jurisdiction
1. 12 nautical mile limit; and
2. Extension of 12 nautical mile limit by REZ (UK has adopted
EEZ as REZ)
28

29. International jurisdiction
Article 60 of UN Convention of Law of Sea confers on a country
“exclusive jurisdiction over such artificial islands, installations and
structures, including jurisdiction with regard to…health and
safety…laws and regulations” for an area extending 200 nautical
miles from the coastline of that country – known as Exclusive
Economic Zone (EEZ).
Article 56 – includes the exploitation of the EEZ for the production
of energy from water, current and wind.
Where the distance between two countries is less than the above
three scenarios, the ‘equidistance principle’ will ordinarily apply.
29

30. Contact
Gary Lewis
Senior Associate
T: 0161 830 5373
M: 07825 204407
F: 0870 460 2910
E:gary.lewis@squiresanders.com
Squire Sanders (UK) LLP
Trinity Court
16 John Dalton Street
Manchester
M60 8HS
30