Belgium

Updated on 08.04.2020.

1. Is there construction-relevant COVID-19 regulation?

No, there is no COVID-19 regulation in Belgium that exclusively applies to the construction industry.

However, general COVID-19 regulations can indirectly affect the construction industry.

Indeed, according to several ministerial orders, since 18 March 2020 and until 19 April 2020 at the earliest, teleworking is mandatory for all non-essential services, regardless of their size and for all workers for whom this is possible, without exception.

When teleworking is not possible, companies must guarantee social distancing. This rule also applies to the organisation of transport by the employer. If these measures are not complied with, companies may incur fines in the event of a first infringement. In the event of a second infringement, they must close down.

Moreover, non-essential travels from and to Belgium are prohibited. Workers based abroad can only cross Belgian borders if they are employed in crucial sectors and essential services. For the other sectors, including the construction industry, foreign workers are obliged to telework. If this is not possible, the performance of their contract is suspended due to force majeure.

Consequently, construction activities may take place outdoor, subject to social distancing measures. This also applies to indoor construction activities in vacant buildings and dwellings.

2. Subsidies and other government support for employer, contractor and other involved parties? (generic, high level only)

So far, no specific measures have been adopted to help the construction industry.

Companies will on the other hand be eligible to benefit from the measures adopted for the benefit of enterprises generally.

Measures largely depend on the region where the company is based.

Not necessarily.

About the concept of force majeure in Belgium, please read the Belgian section of the CMS Expert Guide to Force Majeure.

Since construction activities are not formally prohibited, subject to the compliance with the social distancing obligations, force majeure does not automatically affect the construction industry, but may indirectly affect it.

For instance, based upon the principles described under question 1, workers based abroad could not be allowed to cross the borders and reach the construction site. Deliveries of construction materials could also be affected by the general measures, for instance if the manufacturers/suppliers cannot implement social distancing within their organisation. 

Consequently, through the “snowball effect”, general contractors could potentially suspend their works by reason of force majeure, for instance if they are short of workers or building materials. But this requires a case-by-case analysis, based upon the factual situation and proven evidence.

Regarding the time consequences, as a matter of principle, if a general contractor can establish force majeure, its contract will be suspended as long as the event of force majeure is continuing; it will not be considered in breach of its contractual obligations and no delay penalties will be due.

Regarding the price consequences, as a matter of principle, if a general contractor can duly invoke force majeure to suspend the contract, he cannot claim additional fees. Under Belgian law, the debtor of an obligation suspended by reason of force majeure bears all the consequences of the event of force majeure.

However, as a matter of practice, since parties are free to regulate force majeure clauses (or to insert MAC/hardship clauses), construction agreements usually provide for specific provisions governing, for instance, the ability to invoke force majeure (or hardship), the period within which the event of force majeure must be notified, the effects of the force majeure on the contract, etc.

It must also be stressed that for construction agreements subject to public procurement rules, the latter includes a “revision clause” for unpredictable circumstances beyond the control of the tenderer. The tenderer may invoke the application of this “revision clause” only if he demonstrates that the review became necessary as a result of circumstances which he could not reasonably foresee at the time of the submission of his tender, which he could not avoid and the consequences of which he could not avoid, although he had taken all the necessary steps.

4. Does the Epidemic give rise to termination rights by either party?

As a matter of principle and except as otherwise provided by the contract, should the Epidemic make the execution of the contract definitively impossible or definitively deprive the contract of its object, it could result in the termination of the contract, notably subject to evidence that the contract or its execution cannot be postponed until the end of the Epidemic.

5. Do the measures currently being taken in relation to the Epidemic amount to change in law? What are the price and time consequences?

Since all the measures currently taken in relation to the Epidemic are assumed to be very temporary (and do not address directly the construction industry), they should not be considered as a change in law, except otherwise provided by the contract.

6. Are there any other issues relevant to COVID-19 the construction industry should be aware of?

Based on the principles described under question 1, it must be stressed that as a matter of practice, many general contractors in Belgium, supported by a first advice of the National Confederation of Construction, have first decided to close all their construction sites by reason of force majeure, considering that the social distancing cannot be guaranteed on construction sites.

Many promoters/developers, supported by an advice of the Professional Union of the Real-Estate Professionals, then replied that the force majeure does not apply automatically, since construction activities are not formally prohibited and social distancing is not always impossible.
After discussions and negotiations between the different actors of the construction industry, it seems that henceforth, many construction sites have reopened, fully or partially, what is confirmed by a newsletter published on 7 April 2020 by the National Confederation of Construction.

Picture of Pierre-Axel Chabot
Pierre-Axel Chabot
Partner
Brussels
Picture of  Bruno Duquesne
Bruno Duquesne
Partner
Brussels