Special terms and conditions create a sustainable construction industry
There has long been problems in the construction industry with tax evasion and other crime. Sustainable Construction Industry is an industry initiative that aims to prevent economic crime in the construction industry, to promote healthy competition and to ensure that workers’ rights are respected. The initiative was started by the banks in close collaboration with the real estate and construction sector and has resulted in common guidelines that require developers and construction companies to have increased control over contractors at all levels.
Digital solutions have been developed that capture information from the electronic personnel ledgers that must be available at all construction sites. This means that identities and employer connections can be established for the workers who register in the personnel ledgers. Banks and borrowers can then request digital project reports from the construction projects that show which contractors are active on the construction sites that have been financed. Borrowers are expected to organise their operations, train staff and set routines to ensure processes for pre-registration and ongoing follow-up. Borrowers must act on lack of pre-notification and deficiencies regarding taxes, fees and other regulatory requirements. Any deviations must be explained and measures taken must be reported.
The guidelines will be implemented in the form of special terms and conditions that will be applied from 27 November 2023 for the financing of new construction projects. Danske Bank, Nordea, SBAB, SEB, Swedbank and the Savings Banks are introducing a common set of special terms and conditions to further standardise the banks’ requirements. Mannheimer Swartling has advised the banks with the preparation of these terms and conditions, which have been developed in close cooperation with industry associations in the construction and real estate sector. The firm has also assisted the banks with a competition law analysis of the banking initiative.
More information about the Sustainable Construction Industry banking initiative can be found on the website: https://www.bankinfrastruktur.se/hallbar-byggbransch
