Last edited 04 Oct 2018

Compliance in the construction industry

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In very general terms ‘compliance’ refers to acting according to an order, specification, rule, standard, request, and so on.

Regulatory compliance is the process by which organisations ensure they are operating in accordance with relevant regulations.

In financial terms, compliance involves operating in accordance with external financial rules and with internal control systems that ensure compliance with the external rules. For example, making sure that financial reports and audits are prepared, that tax requirements are fully met, and so on.

Compliance can also relate to manufacturers and suppliers of goods and services, who must meet the requirements of contracts, specifications, drawings, standards, best practice guidelines, legislation, and so on.

Construction products and materials are generally subject to rigorous testing to verify that they comply with requirements, and may receive certification (sometimes from third parties) to confirm that they do. For example, they may have kite marks, CE marking, manufacturer's certificates, buildings regulations approval and so on.

In terms of the tender process itself, bids made by prospective contractors or suppliers will be evaluated first and foremost to determine whether they comply with the client’s requirements. A non-compliant proposal, sometimes referred to as a variant bid, may be submitted if the tenderer believes that an alternative could offer better value for money. However, non-compliant proposals should only be submitted if they have been requested or are explicitly permitted by the client, and they may need to be accompanied by a compliant bid.

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