EU construction industry pleads for force majeure status on coronavirus

LONDON (ICIS)–The EU construction sector has called on the European Commission – the EU’s executive body – to officially designate the coronavirus outbreak a force majeure event to avoid penalties for firms that end in breach of contract due to the crisis.

Construction companies stand to be “heavily affected financially” as lockdown measures and other contagion-mitigation efforts introduced across Europe make construction projects difficult or impossible to continue with, according to the European Construction Industry Federation (FIEC).

Public and private projects are likely to be cancelled under the current social distancing measures introduced by lawmakers, the FIEC said in a statement.

The Commission should officially designate the outbreak a force majeure event, and recommend to member states that construction firms be allowed to suspend or reduce ongoing construction work on projects.

The construction market is a key consumer of chemicals, driving demand for a wide variety of products like resins and derivative products such as plastic pipe, insulation, paints and coatings, or adhesives and synthetic fibres, among many others.

Ongoing projects co-financed by the EU should be allocated resources for the additional costs likely to ensue from disruption and higher costs as a result of the pandemic, the FIEC added.

“They are the crucial measures that the construction sector needs to survive,” the group said in a statement.