FCA as gatekeeper of UK crypto AML regime: two years in
6 October 2015 marks the end of the six-month transitional period under the CDM Regulations 2015, which was granted by legislators to Clients (i.e. persons “for whom a project is carried out”) to allow them to replace CDM Co-ordinators appointed prior to 6 April 2015. As of 6 October 2015, the role of the CDM Co-ordinator (pursuant to the CDM Regulations 2007) ceases to exist. All Clients must have terminated any CDM Co-ordinators appointments and brought Principal Designers (“PD”) on-board. Please note that Principal Designers must be appointed in writing for projects with more than one contractor (this may mean one main contractor and a sub-contractor) (see regulation 5.1).
It would be fair to say that amongst all changes introduced by the CDM Regulations 2015, the new role of Principal Designer is the one that caused most upheaval. The market has seen a lot of debate during the past months as to which sort of practices should undertake the PD role. A common worry across the industry relates to the fact that most practices that are seen as obvious candidates for this role (such as architects who fit the description of “a designer with control over the pre-construction phase” – see regulation 5.1(a)), may not have the necessary health and safety in-house capability.
Approaches that have been used to date include:
Another point worth making is that where an Architect is appointed as PD and the appointment is subsequently novated to the Contractor, the client needs to agree with the Contractor whether the Contractor would undertake the PD role post-novation or if the Architect’s PD duties will not be novated (in which case it would be advisable for the client to include these in a separate non-novated agreement from the outset).
To add to the confusion, the Approved Code of Practice 2007 had been abolished. As such, a statutory standard to refer to when discharging CDM duty holders’ obligations no longer exists beyond the actual CDM Regulations 2015. Although the HSE has published guidance on the new legal requirements, it is very likely that existing market practices stemming from ACoP will continue to be used for a while.
Further developments in this area are to be expected. It will be interesting to see what the solutions the market will adopt in the coming months so watch this space!
Should you have any questions about the issues raised in this blog, please contact a member of the Real Estate team.
Brandusa Tartaru-Marinescu was a Construction Partner in our Real Estate team.
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