EUROPEAN COMMISSION Brussels, 30.3.2022 SWD(2022) 88 final COMMISSION STAFF WORKING DOCUMENT



IMPACT ASSESSMENT REPORT

[…] Accompanying the document Proposal for a Regulation of the European Parliament and of the Council laying down harmonised conditions for the marketing of construction products, , amending Regulation (EU) 2019/1020 and repealing Regulation (EU) 305/2011















{COM(2022) 144 final} - {SEC(2022) 167 final} - {SWD(2022) 87 final} - {SWD(2022) 89 final}



Table of Contents 1.Introduction: Political and legal context 2.Problem definition 2.1.What are the problems? 3.What are the problem drivers? 3.1.Problem drivers 3.2.How will the problems evolve? 4.Why should the EU act? 4.1.Legal basis 4.2.Subsidiarity: Necessity of EU action 4.3.Subsidiarity: Added value of EU action 5.Objectives: What is to be achieved? 6.What are the available policy options? 6.1.What is the baseline from which options are assessed? 6.2.Description of the policy options 6.3.Options discarded at an early stage 7.What are the impacts of the policy options? 7.1.Option A – baseline (no revision)

7.2.Option B - Repairing the CPR 7.3.Option C - Focusing the CPR 7.4.Option D - Enhancing the CPR 7.5.Option E – Repealing the CPR 8.How do the options compare? 8.1.Comparison of the options 8.2.Preferred option 9.REFIT (simplification and improved efficiency) 10.How will actual impacts be monitored and evaluated? Annex 1: Procedural information Annex 2: Stakeholder consultation Annex 3: Who is affected and how? Annex 4: Analytical methods Annex 5: The SME Test – Summary of results Annex 6: Description of the CPR framework Annex 7: The European technical assessment (ETA) system (the EOTA route) Annex 8: Simplification provisions under the current CPR Annex 9: The environmental and climate impact of construction products Annex 10: Articulation with other existing EU legislation and other initiatives Annex 11: Interaction between the future CPR and the SPI

Annex 12: Refined indicative options paper, April 2020 Annex 13: Options and elements discarded Annex 14: James Elliott judgment (C-613/14)



Glossary Term or acronym Meaning or definition AVCP Assessment and verification of constancy of performance BWRs Basic requirements for construction works or Basic Work Requirements CEN European Committee for Standardisation (Comité européen de Normalisation) Cenelec European Committee for Electrotechnical Standardisation (Comité européen de normalisation en électronique et en électrotechnique) CPD Construction Products Directive (repealed) CPR Construction Products Regulation DoP Declaration of performance EAD European Assessment Document EDD Ecodesign Directive EGD European Green Deal ELD Energy Labelling Directive EOTA European Organisation for Technical Assessment EPBD Energy Performance of Buildings Directive ETA European Technical Assessment ETAG Guidelines for European technical approval EU European Union NB/NBs Notified body/Notified Bodies NGO Non-governmental organisation NLF New Legislative Framework, formerly New Approach OIOO one in, one out approach OJEU Official Journal of the European Union PCPC Product Contact Point for Construction REACH Regulation concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals REFIT Regulatory fitness and performance programme RSB Regulatory Scrutiny Board SME Small and medium-sized enterprise SPI Sustainable Products Initiative TAB Technical Assessment Body 1.Introduction: Political and legal context The construction products industry encompasses around 430,000 companies with a turnover of around 800 billion Euros and a gross value added of around 240 billion Euros. It mainly serves the construction industry, which is one of the 14 industrial ecosystems identified in the updated industrial strategy, with a significant contribution to the EU economy, accounting for 1,200 billion Euros gross value added (10 % of total value added) and 25 million people employed. Both sectors, the producers of construction products and the construction ecosystem as principal user of the products mainly consist of micro-enterprises. Regulation (EU) No 305/2011 of the European Parliament and of the Council laying down harmonised conditions for the marketing of construction products (the ‘Construction Products Regulation’ or CPR) was adopted in 2011 and has applied in full since July 2013. The Regulation’s main objective, like that of the earlier Construction Products Directive (‘CPD’), is to improve the functioning of the single market and the free movement of construction products in the EU by laying down harmonised conditions for their marketing. Unlike most internal market legislation, the CPR does hardly set any product requirements that construction products would be required to meet. Instead, it mainly sets harmonised rules on how to express their performance in relation to their essential characteristics (e.g. reaction to fire, thermal conductivity or sound insulation) and provides harmonised rules on the CE marking of these products. Since the construction products merely contribute to the construction works – these latter falling within the remit of national competences – the Member States remain fully responsible for the safety, environmental and energy requirements applicable to buildings and civil engineering works. The Commission’s July 2016 implementation report on the CPR identified certain shortcomings in its implementation. The report also identified a significant number of challenges going beyond mere implementation and deserving further serious examination and discussion, including issues linked to standardisation, market surveillance and enforcement, and simplification provisions for micro-enterprises. The November 2016 Clean Energy for all Europeans Communication mentioned the need to unlock the construction sector’s growth and jobs potential by improving the functioning of markets, in particular the still fragmented internal market for construction products. The Communication also highlighted the need to reinforce the focus of the policy on products with the highest savings potential in terms of energy and circular economy. It referred to the consultation process that followed the 2016 implementation report, mentioning that this could lead to a revision of the Construction Products Regulation within the mandate of the 2014-2019 Commission. To meet this timetable, the Commission initiated a back-to-back evaluation and impact assessment to provide a solid basis for any possible future adaptation. The approach was presented in the inception impact assessment published in June 2017. However, considering the evidence collected through the supporting studies and public consultation, the Commission decided to decouple the retrospective and prospective assessments. The assessment proved to be more complicated than expected: partly due to the complexity of the CPR itself, but also due to the high expectations expressed by the stakeholders and Member States. These combined factors made clear that it was necessary to establish a clear and comprehensive picture of the present situation before identifying all of the key horizontal issues and the assessment of potential options for the future. Hence, the evaluation of the CPR was published on 24 October 2019. In the meantime, several new policy initiatives with direct impacts on the CPR were adopted by the Commission. In December 2019, the European Green Deal (EGD) Communication mentioned the review of the CPR as part of the efforts towards building and renovating in an energy- and resource-efficient way. Later in March 2020, in the Circular Economy Action Plan (CEAP) , the Commission underlined the objective of addressing the sustainability performance of construction products in the context of the revision of the CPR, including the possible introduction of recycled content requirements for certain construction products, taking into account their safety and functionality. A similar concept was also included in the Renovation Wave, where revision of the CPR was mentioned as one of the areas of interventions addressing the sustainability performance of construction products. It was announced that the Commission will consider, in the framework of the CPR revision, how sustainability criteria could support the uptake of more sustainable construction products in construction works and foster the uptake of the latest technologies. The Renovation Wave also recognised the need for using low-carbon materials in order to render buildings more climate-friendly. As announced in CEAP, a Sustainable Products Initiative (SPI) is currently under preparation with the aim of making products fit for a climate-neutral, resource-efficient and circular economy. The initiative will widen the scope of the Ecodesign Directive (EDD) to all products and to provide for the setting of specific requirements linked to a list of aspects set out in the CEAP. These include durability, reusability, the presence of hazardous chemicals, energy and resource efficiency; carbon and environmental footprints, as well as recycled content, while ensuring products’ performance and safety. It will aim to improve products sustainability, to give access to sustainability information along the supply chain, to incentivise more sustainable products and business models. For construction products, SPI goals shall be mainly realised by means of the Construction Products Regulation (CPR) also to avoid double burden. The CPR shall be able to mirror all obligations and requirements able to be set through the SPI, but for construction products.

By aiming to improve safety, sustainability and circularity of construction products, the CPR would also support the objectives of the New European Bauhaus initiative, namely a healthy and safe living environment as well as sustainability and circularity. As announced in the Communication, and following the Communication on the update of the 2020 New Industrial Strategy, the Commission is in the process of co-creating a transition pathway for a green, digital and resilient construction ecosystem. The Council, in its conclusions on "Circular Economy in the Construction Sector" of 28 November 2019 acknowledged the potential of circular economy in construction activities from an environmental and economic viewpoint and urged the Commission to undertake action to promote circularity further. In December 2020 the German Council Presidency presented suggestions on the Future of the Construction Products Regulation regarding the further development of the current CPR and regarding a revised CPR. In March 2021 the European Parliament adopted an own initiative report prepared by the Committee on Internal Market and Consumer Protection on the Implementation of the Construction Products Regulation. The Parliament welcomed the revision of the CPR with a view to further addressing barriers in the internal market for construction products and contributing to the objectives of the EGD and CEAP. 2.Problem definition 2.1.What are the problems? The main objective of the Construction Products Regulation has been to foster a smooth functioning of the internal market for construction products, through providing for a common technical language, based predominantly on harmonised standards. The CPR ensures that reliable information is available to professionals, public authorities, and consumers, so they can compare the performance of construction products from different manufacturers in different EU Member States. Standards provide a common basis for testing and communicating the performance of construction products, allowing manufacturers to prepare a single declaration of performance (DoP) for their products, affix the CE mark and eventually put their products on the EU internal market. The evaluation of the CPR, as well as feedback received from the Member States and stakeholders point clearly to the underperformance of the framework, hindering the functioning of the single market for the construction products, and so failing to achieve the CPR’s objectives. This, together with the need for the construction sector to contribute to the European Green Deal objectives of transforming towards a modern, resource-efficient and competitive economy, are the main underlying reasons for the Commission to consider a revision of the framework. The framework’s underperformance is due to a number of overarching issues with regard to the functioning of the CPR, as identified in the evaluation. The main problems are: Problem 1: Internal market for construction products not achieved The product performance information system under the CPR requires uniform application in order to be efficient. Hence the crucial role of harmonised standards as essential element of the common technical language. The use of standards in support of the CPR is mandatory if they are cited in the Official Journal of the European Union (OJEU). Such harmonised standards, developed by the European Standardisation Organisations (ESOs), are necessary for testing and communicating the performance of construction products. As such, harmonised standards in support of the CPR form a common technical language that acts as a link between the performance of construction products and the basic requirements for construction works (also called Basic Work Requirements or BWRs) set out in Annex I of the CPR, depending on their essential characteristics and intended use. When harmonised standards in support of the CPR are cited in the OJEU, products covered by such standards have to be CE marked – this indicates that they have been assessed to be in conformity with their declared performance . The Member States are then obliged to allow the marketing of CE marked construction products, without requiring any additional marks, certificates or testing . Up-to-date and comprehensive harmonised standards cited in the OJEU are therefore essential for the functioning of the internal market, as they provide the manufacturers with a single framework for testing their products, thereby facilitating market access and creating a level-playing field. In fact, while at the time of the 2008 Impact Assessment, it was expected that the (then) new CPR would lead to increased levels of competition , the statistical analysis could not demonstrate any overall impact of the CPR on cross-border trade for construction products . To date, the standardisation process at the core of the CPR has been underperforming. In the recent years, draft harmonised standards developed by the ESOs have rarely been cited in the Official Journal (OJEU) mainly due to legal issues, such as contradiction with the requirements of the CPR or trespassing the scope of the mandate/standardisation request. Since early 2019, despite multiple efforts, not a single standard in support of the CPR has been cited in the Official Journal (OJEU). The lack of citation of up-to-date harmonised standards for construction products is considered a key factor undermining the internal market, with outdated harmonised standards causing direct or indirect costs for the businesses, particularly SMEs . This problem was frequently underlined by the stakeholders who observed that the lengthiness of the standardisation process has serious consequences for the realisation of the internal market. The process is too slow to keep pace with the developments in the sector. The resulting standards may then not always be market-relevant as well as do not fulfil the regulatory needs of Member States. Five technical bodies, four business representatives, three public authorities, and one SME representative participated in the semi-structured interviews stressed the need to address the problem of the slow citation of harmonised standards under the CPR. The CPR provides for an alternative route for CE marking for construction products not covered or not fully covered by harmonised standards – the EOTA route – by providing the possibility for manufacturers to request a European Technical Assessment (ETA). The manufacturer may issue a Declaration of Performance and affix the CE marking on the basis of an ETA. ETAs are issued by Technical Assessment Bodies on the basis of European Assessment Documents (EADs), developed by European Organisation for Technical Assessment (EOTA) and cited by the Commission in the OJEU (see Annex 7 on the functioning of the EOTA route). The underperformance of the standardisation system leads also to putting the EOTA route under strain. More details on this are further developed in section “3.2 How will the problems evolve?” Furthermore, while the CPR lays down no specific, direct requirements in terms of product safety, manufacturers declare the performance of products with regard to their essential characteristics, which include safety. However, this is not in all cases appropriate. Product safety related requirements are often hidden as product “description” in the mandatory standards and may not cover inherent safety risks. Examples of inherent safety risks for construction products are mechanical risks (squeezing, cutting, slipping), mechanical failure (e.g. locks of escape doors not opening), physical failure (e.g. too wet/too dry wood installed), risks of electric failure (sensibility of fire detectors, risk of short-cuts and thus fire) or risks of incompatibility of substances/materials (glues for floorings and flooring materials). All in all, inherent product safety (safety aspects not related to the safety of construction works), is not dealt with in a consistent manner for construction products and is largely left to the Member States, despite Article 114 TFEU (the legal basis for the current CPR) requiring to strive for a high level of protection of safety and consumers. Requirements linked to inherent safety defined at national level risk adding to the trade barriers within the internal market for construction products. Further obstacles to the internal market remain, among others, in the form of continued existence of the national marks, certifications and approvals. This creates additional barriers, e.g. through national requirements for additional testing or national product approval for a product to be marketed/used in a given Member States, and leads to additional costs. The existence of national marks, certifications and approvals is clearly linked to the incomplete character of harmonisation under the CPR, the latter not including a possibility for standards to cover environmental nor safety requirements for products. In a nutshell, if the CPR remained unrevised, there would be no significant changes to market opportunities as a result of the CPR, thus leaving the potential for European legislation on construction products to stimulate further growth in cross-border trade in the sector unexploited . Problem 2: Implementation challenges at national level Despite improved cooperation among market surveillance authorities, it became apparent during the implementation of the CPR that market surveillance activities are broadly seen as ineffective and widely varying in quality and effectiveness from one Member State to another . Ineffective market surveillance nurtures limited trust in the regulatory framework and is thus a disincentive for companies to comply with the legislation, either because there is little risk of getting caught, and/or because companies feel that they are exposed to unfair competition . Insufficient market surveillance and enforcement prevents benefits in terms of opening up markets and levelling the playing field for competitors from materialising fully .

Furthermore, some drawbacks with regard to the functioning of Notified Bodies (NBs) and Notifying Authorities were identified in the report on the implementation of the CPR, indicating that relevant CPR provisions would benefit from more accuracy, e.g. on requirements for NBs (Article 43), on operational obligations for NBs (Article 52) and on coordination of NBs (Article 55). Problem 3: Complexity of the legal framework /simplification not achieved Certain features of the CPR differ from the ones used in most internal market legislation. Particularly, the meaning of the CE marking refers to assessing the performance of a construction product instead of its conformity with product requirements. However, it is not clear to several stakeholders (even manufacturers, distributors, importers, professional end users and raw material suppliers) that the CE marking under the CPR is not a quality mark and does not indicate product safety or that a product complies with national building requirements. The confusion created by the misunderstanding or misinterpretation of the CE marking creates significant legal uncertainty . The simplification provisions (see Annex 8 for details) within the CPR are aimed predominantly at SMEs and include Article 5 (derogations from drawing up a Declaration of Performance - DoP), Article 36 (intended to avoid unnecessary repetition of testing), Article 37 (simplified procedures for micro-enterprises) and Article 38 (simplified procedures for products individually manufactured or custom-made in a non-series process). The uptake of these Articles, with the exception of Article 36, remains very limited. These provisions were expected to lead to a simplification effect, reducing the administrative cost of placing the construction products on the market without compromising the level of safety of construction works. However, various assessments and feedback from the stakeholders show a low uptake of these simplification provisions mainly due to low awareness and lack of clarity of the provisions, particularly with respect to what actually constitutes “equivalent” documentation. The attempt to “level the playing field” for the smaller companies particularly through Article 37 has not been successful. Furthermore, the justification of measures that allow some manufacturers to implement such “lighter” procedures are called into question, considering that this creates uncertainty for end-users, who may justifiably expect that all products bearing the CE mark are subject to the same procedural requirements. The evaluation showed that while some simplification has been achieved by the CPR, this has been less than expected. Furthermore, some CPR provisions are insufficiently clear or create overlaps, either within the CPR framework itself, or between the CPR and other EU legislation. As an example, Article 9(2) of the CPR includes a list of information that has to accompany the CE marking, most of which the manufacturer has already presented in the Declaration of Performance (DoP). This situation has been subject to heavy criticism since the beginning of the CPR implementation. The overlap between the information required in the DoP and in the CE marking generates redundant administrative and financial burdens and constitutes a clear inefficiency. With respect to clarity and coherence between the CPR and other pieces of EU legislation, there are a number of areas where they overlap and/or are in conflict with each other, including the Ecodesign Directive (EDD) and several other product/technical directives. This creates potential overlaps with respect to the procedures established for construction products, in particular regarding parallel routes for CE marking. The supporting study for the fitness check carried out an analysis of the coherence of selected EU acts applying to the construction sector. The study considered the legal overlaps between the CPR and EDD (2009), and Energy Labelling Directive (ELD), which may also apply to construction products, and confirmed the inconsistencies in definitions, lack of cross-references and overlaps between the three pieces of legislation. The precise costs of these legal overlaps could not be quantified but may be significant for manufacturers of those specific products. Existing overlaps between the EDD and CPR for specific product categories currently relate to five product categories, namely solid fuel boilers, (solid fuel) local space heaters and space/water heaters, as regulated by Commission Regulations (EU) 2015/1185, 2015/1188, 2015/1189, 813/2013, and 814/2013. In its opinion XII.8.a , the REFIT platform also recommended that the Commission gives priority to addressing the problems of overlapping and repetitive requirements. Problem 4: Inability of the current CPR to deliver on broader policy priorities, particularly the green and digital transition With a view to reducing emissions and reaching climate neutrality by 2050, there is a need to mobilise industry to move towards a climate-neutral and circular economy, particularly in resource-intensive sectors such as construction. The building stock, currently responsible for 40% of final energy and 36% of greenhouse gas emissions in the EU, has a large cost-effective potential to reduce emissions. The European Climate Pact recognised the need for using low-carbon materials in order to render buildings more climate-friendly. The analysis underpinning the European Climate Pact has identified that in order to achieve the proposed 55% climate target by 2030, around 275 billion EUR of additional investments are needed per year in buildings renovation. Construction products will constitute a substantial part of these additional investments, especially as in renovation the share of the construction products (such as insulation materials, wooden engineered boards, metal structures or glass) on the turnover of projects is higher than in new construction. Therefore, a substantially rising demand for construction products can be expected in the next years. Underperformance of the CPR framework could affect the implementation of the renovation wave, highlighting the need for a frictionless and innovative internal market for construction products to fulfil the targets of the EGD and especially for the renovation wave. Minimising the climate footprint of buildings requires, among others, resource efficiency and circularity. It also requires shifting the focus from the environmental impacts during the use phase to the entire life cycle of the building. In such a holistic approach, the choice of construction products will play a key role. However, so far it is difficult to compare performance of construction products and materials across various circular design related aspects, such as ease of disassembly, future reuse potential, maximum technical service life, whole life cycle cost/carbon, material intensity/waste and reparability . The climate resilience of specific infrastructure, buildings and civil engineering works is determined by local circumstances and building codes in the Member States, and where relevant other EU legislation. This is therefore outside the scope of the CPR. But in order to properly design, maintain and renovate the construction works also under the changing climate conditions, there is a need to provide accurate information on the performance of construction products. There is significant mitigation potential to be achieved in the manufacturing of construction products. For instance, for steel the shift away from blast furnace (BF) to electric arc furnace (EAF) (using scrap metal) can lead to sector emissions reduction of around 25-30% compared to 2010. In the cases of hydrogen, electrolysis or CCS and CCU, the reductions can be much higher. If the direct reduced iron is produced via either hydrogen or electrolysis iron ore reduction, it allows for electrification of the most energy-intense step in iron making , leading to reductions up to 85-95%. Similarly, also for the chemicals and cement sector, large emission reduction potential exist. Other products can even have net-negative CO2 emissions and thus store CO2 in construction. To stimulate the incentives and demand for low-carbon construction products at the construction works level, coherent and transparent information on the climate, environmental and sustainability performance of the construction products is needed, but currently not covered by the harmonised system under the CPR. In this context, Annex I to the current CPR provides for basic requirements for construction works (BWRs), among which BWR3 already refers to the environmental impacts, and BWR7 refers to sustainable use of natural resources. However, the current harmonised standards under the CPR cover only some elements of BWR3 (e.g. emissions of dangerous substances into the air, emissions into soil or ground water) and none of BWR7. This is because there was a lack of agreement among the standardisers about how to apply these BWRs across different construction products. Additionally, it has not been prioritised, especially as in the past the regulatory needs of the Member States were less obvious when it came to environmental aspects, as opposed to e.g. fire safety or structural stability. The amount of energy consumed, the CO2 emissions and other negative environmental impacts are mostly significant in the process of the production of construction products. In this view, the performance approach can at best indirectly regulate the production stage. Therefore, the harmonisation provided by the CPR and the legal instruments adopted under it fall short of covering these elements. The construction products are thus not yet subject to harmonised assessment and verification of the constancy of performance in this area. This significantly limits the possibilities for the sector to declare, in a consistent and harmonised way, the performance of their products and to differentiate the products with regard to climate, environment and sustainability performances. It also significantly limits the possibilities for Member States to define national requirements or to include criteria in public procurement for the purposes of sustainability objectives without putting at risk the functioning of the internal market. The CPR is also not fit to take account of the new business models stemming from the progressing digitisation of the sector, such as e.g. 3D printing. Moreover, without a transition of the construction sector towards more digitalised approach to data registration, storage and sharing, the objectives of the European Green Deal risk being undermined as gaps may occur when it comes to the product information, rendering the information available along the supply chain incoherent and not transparent. Under the current CPR, digital information is not available. This will become a challenge particularly as reliable product information, from manufacturing to the installation in the building and demolition will be necessary to live up to the goals of circularity and sustainability, and will be required by other linked legislation (e.g. Energy Performance of Buildings or SPI). Similarly, the current CPR does not encompass the application of a Digital Product Passport, which could be used in digital building logbooks, Level(s) or other tools for assessing and reporting on the sustainability performance of buildings. Other issues not linked with the four problems presented above The following issue has been also identified as important to be addressed in the revision, while not explicitly covered in the evaluation: As the price of construction materials and output price index have increased, the construction sector is challenged by increasing building costs. At the same time housing affordability and energy poverty are a challenge for many European citizens, as house prices have risen faster than the incomes in most Member States. Overall, these increasing costs make it challenging for the construction industry to build affordable houses for low-income households. At the moment, each building, even when they are just replicated, would need at least one permit in each Member State. A European market for (types of) prefabricated small houses would allow reaching economies of scale to drive down building costs, if standards for such houses would be developed under the CPR (in line with Member States regulatory needs and the local demand). In addition, national and local authorities could potentially grant building permits in a fast track procedure.

3.What are the problem drivers? 3.1.Problem drivers The main problems above are driven by regulatory failures. [Drivers for Problem 1] On the one hand, the internal market for construction products cannot function properly without up-to-date harmonised standards in support of the CPR cited in the OJEU. Because of their mandatory character and the exhaustive nature of harmonisation under the CPR, when no new standards are cited, the market needs and regulatory needs of the Member States cannot be addressed. Lack of citation is due to a mismatch between the legal criteria applied by the Commission when assessing the harmonised standards under the CPR and the ability of standardisers to deliver requested outputs. In the recent past, new standards could not have been cited in the Official Journal mainly due to legal issues, such as contradiction of the standards with the requirements of the CPR or trespassing the scope of the mandate/standardisation request. Several judgments of the Court of Justice of the EU underlining the role of the Commission in monitoring and management of the standards development have resulted in a more stringent approach of Commission services when assessing draft harmonised standards. At the same time, under the current CPR, the Commission has no alternative whenever the standardisation process is not delivering. It lacks empowerment to rely on an alternative solution (‘safety net’) when standards are not delivered, or are not delivered within a reasonable timeframe or are considered to be of insufficient quality. Further, in contrast to the former CPD, under the current CPR standards should not address the inherent product safety of essential characteristics. This also creates “gaps” in the standards, particularly in view of the Member States. The incomplete character of harmonised standards under the CPR has contributed to a number of Member States setting additional requirements for construction products, including the reliance on national approvals, certifications and marks, in order to fill the “gaps” in harmonised standards and be able to fully regulate the safety of construction works. Member States added further performance requirements not covered by the harmonised standards, thereby being in conflict with the principle of “exhaustiveness” of the harmonised system under the CPR. Several CJEU rulings have confirmed the exhaustiveness of the harmonised system created under the CPR, thereby leaving no room for any other (national) system to deal with the marketing of construction products, within the harmonised sphere, presenting economic operators with additional requirements which add costs and act as obstacles to the internal market” . However, harmonised standards currently cited in the OJEU cover only some of the Basic Work Requirements set out in Annex I of the CPR (serving as a reference for the Member States to lay down requirements for construction works on their territory), or are out-dated and do not any more contain all elements necessary to fulfil Member States’ regulatory needs. The national marks, certifications and approvals are therefore expected to persist, as the incomplete character of the harmonised standards adopted under the CPR prevents the Member States from relying on harmonised performance criteria and assessment methods. [Drivers for Problem 2] As presented in the evaluation, the implementation of the CPR and multiple feedback from the stakeholders confirm that the market surveillance in many Member States is insufficient and so ineffective. Moreover, several stakeholders noted that there is no clarity which organisations are responsible for market surveillance and enforcement and also there is a lack of reporting mechanisms. The main area where stakeholders have identified inconsistencies in terms of implementation was in relation to the level of market surveillance in Member States. While it is largely because of the lack of appropriate resources to tackle the non-compliance effectively, the lack of clarity of the current CPR provisions on market surveillance also plays a significant role. This results in a diverging application of these provisions because of varying interpretations by national authorities. [Drivers for Problem 3] The uptake of simplification provisions under the CPR remains very limited. Various assessments and feedback from the stakeholders show that the driver for this problem is low awareness and lack of clarity of the provisions, particularly with respect to what actually constitutes “equivalent” documentation . The notion of “equivalence” is not explained, the conditions for practical implementation of the simplified procedures remain therefore unclear, with small enterprises and other actors, including Member State authorities, struggling to implement the rules. The lack of clarity is backed by the presence of a very strong support for general clarification (redrafting) of the simplification provisions . The lack of clarity prevents achieving simplification and reduced costs for specific types of products and economic operators, particularly for micro-enterprises/craft enterprises. [Drivers for Problem 4] The current CPR is not able to deliver on the policy objectives stemming from the European Green Deal and the Circular Economy Action Plan, as these new policy objectives are not reflected therein. In particular, the CPR does not permit to establish product requirements which are not performance-related. For this reason, the CPR is also not flexible enough to contribute to the ambitious commitments proposed in the EGD and the CEAP. The absence of references to sustainability performances in the harmonised standards adopted under the CPR is resulting in Member States unlawfully introducing additional national requirements for construction products, putting at risk the functioning of the internal market and imposing additional costs on manufacturers, particularly relevant for SMEs. The current CPR is also unable to deliver on new business models, in particular 3D printing. The problem linked to 3D printers used for decentralised manufacturing derives from the fact that none of the three actors involved (the designer, the client, the owner of the printer) is necessarily a manufacturer or a producer in the meaning of applicable product legislation. Consequently, without a responsible manufacturer 3D printed products escape the current scope of product safety legislation. Therefore, the obligations of the CPR, which build on the responsibility of a manufacturer, are not applicable. 3D printed products could be produced in high numbers without undergoing any conformity assessment procedure. This regulatory gap might lead to risks for consumers or other users and create unfair competitive relationships . Provisions related to 3D printing will provide a level playing field to manufacturers using this technology, preventing the creation of barriers to trade or unjustified compliance cost. Furthermore, the current CPR does not foresee broad application of digital tools e.g. digital information sharing and digital information flow. 3.2.How will the problems evolve? As previously explained, under the current framework hardly any new standards or amendments of standards in support of the CPR have found their way into the OJEU, and none since early 2019 (see also the table and figures below). Economic operators cannot realise the full benefits of a consolidated internal market nor rely on a harmonised manner to inform users about the performance of their products. With time, harmonised standards already cited in the OJEU become more and more obsolete (the majority of them has been cited more than 10 years ago) and, in addition, often no longer correspond to the technology used. In the meantime, many of the existing standards have been updated by the standardisers and were made available to manufacturers. However, these updated versions have not been cited in the OJEU as harmonised standards under the CPR because of important legal and content-wise shortcomings. As long as they are not cited in the OJEU, they do keep the status of a European Standard (EN), hence can be voluntarily used by the manufacturers, but cannot serve as a basis to draw up a declaration of performance and affix the CE marking. This situation demonstrates the willingness of the industry and standardisers to continue developing state-of-the-art standards for the construction sector. However, these standards do not meet the overriding legal framework requirements of the CPR to give them the status of harmonised standards. If this is not addressed, the discrepancy between the needs of the Member States and the market actors on one hand and the reality of the harmonised system under the CPR on the other hand is thus likely to further increase over the years. This is also expected to lead to increased burden on the so-called EOTA route, allowing for the CE marking based on European Technical Assessments (ETAs) that are issued based on an EAD. This route was originally intended to allow the most innovative products not (fully) covered by harmonised standards gaining access to the market. However, due to the malfunctioning of the standardisation system, in recent years it is more and more frequent that the EADs are considered an alternative route to (lacking new) harmonised standards, consequently most of the new EAD developments regard products that slightly deviate from the scope of existing harmonised standards. Such practice benefits mainly the manufacturers requesting an ETA (and so not all manufacturers of the same type of products). Such ETAs are developed at a cost to be borne by the manufacturers requesting them. As only the manufacturer having requested ETA can affix the CE marking to the assessed product, this causes unnecessary cost to many manufacturers requesting ETAs, instead of allowing all manufacturers to rely on harmonised standards for CE marking purposes. These costs would not present themselves in case relevant harmonised standards were cited in the OJEU. While recurring to ETAs is not against the provisions of the CPR, such practice leads to a large number of requests to assess draft EADs (see Article 19(2) and Annex II of the CPR) annually to the Commission and this situation risks becoming dysfunctional as well, due to a higher number of complex assessments to be handled by limited Commission resources. Generally, the EOTA route is commercially beneficial for companies with innovative products (or other products not covered by a harmonised standard), however the problem is that the process of developing EADs and on their basis ETAs was not structured to deliver hundreds EADs per year and therefore it has become too slow, and slowness is particularly detrimental to innovative products. In fact, manufacturers want to CE mark and put their innovative product on the market as quickly as possible, and the slow process may sometimes act as a halt to innovation. The fact that a large number of ETAs has been issued (more than 6,900 as of end 2020), and that the number of ETAs issued each year is growing rapidly, seems to indicate that manufacturers think that this CE marking option is worth the time and cost – in other words, that it is effective for all products not only innovative, despite there being room for improvement in terms of length of the process. This might be especially true in a situation where no harmonised standard is being cited. However, this route to the CE marking brings additional costs for each manufacturer who requests an ETA, compared to the situation if a relevant harmonised standard was cited in OJEU. Moreover, it brings additional burden to the Commissions resources as the number of requests to assess the draft EADs increases.

The figures below present the evolution of the harmonised standards under the CPR, the European Technical Assessments (ETAs) and European Assessment Documents (EADs) over the recent years. 2014 2015 2016 2017 2018 2019 2020 Harmonised standards (hENs)a) hENs offered by CEN 30 89 57 20 21 19 1 hENs published in OJEU 23 25 18 19 9* 0 0 European Technical Assessments (ETAs)b) based on ETAGs 381 581 703 777 638 272 237 Based on EADs 2 55 176 374 972 831 937 European Assessment Documentsb) Registered as DPs (draft EADs) 50 135 99 182 124 103 93 Cited in OJEU 0 19 65 71 64 13 44 Source: a) COM internal data; *publication of 6 standards delayed to early 2019; b) EOTA



Figure 1: Number of hENs offered by CEN and hENs published in the OJEU Source: COM internal data Figure 2: Number of ETAs based on ETAGs and on EADs Source: EOTA



Figure 3: Number of EADs registered as draft and number of EADs cited in OJEU Source: EOTA, COM internal data Based on this overview, the expectations are that these issues will become more pressing over time, with manufacturers continuing to use the EOTA route for CE marking, incurring unnecessary additional costs on top of putting under strain the Commissions limited resources. Finally, new political goals, namely stemming from the European Green Deal and the CEAP, cannot be effectively pursued under the current CPR making it difficult if not impossible to deliver on the objectives relevant for construction products, including circularity and environmental impacts. Although the current CPR could address partially these goals (with the BWR3, referring to the environmental impacts, and BWR7, referring to sustainable use of natural resources), this is hardly achievable with the blocked technical harmonisation system. As consequence, the current CPR cannot address the SPI goals. Without a revision of the CPR, the sustainability aspects of construction products would then need to be addressed under the SPI with a risk of double administrative burden (the same product regulated under two acts). This could also put at risk the coherence between safety and sustainability aspects which is crucial considering the role of construction products in construction works. Also, without an overarching framework to ensure sustainability of construction products in the EU the fragmentation of the EU Internal Market will gain further momentum, as individual Member States will continue their attempts to tackle the described issues at national level. 4.Why should the EU act? 4.1.Legal basis The first paragraph of Article 114 of the Treaty on the Functioning of the European Union (TFEU) empowers the European Parliament and the Council to adopt measures for the approximation of the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment and functioning of the internal market. Article 114 TFEU allows the EU to take measures both to eliminate current obstacles to the establishment and functioning of the internal market and to address barriers that dissuade economic operators from taking full advantage of the benefits of that market. Through the CPR, the EU has sought to remove these obstacles to the circulation of construction products within the European single market – this being an objective since the adoption of the Construction Products Directive. Article 114 TFEU forms the legal basis for the current CPR and is the appropriate legal basis for its revision.

In addition to pursuing internal market objectives, the initiative aims to contribute to a high level of environmental protection and combatting climate change (Article 11 and Articles 191 to 193 of the TFEU) as it also aims to contribute to the Circular Economy Action Plan, the Renovation Wave and other linked initiatives. However, internal market objectives are predominant, as the absence of adequate and comprehensive internal market rules to regulate marketing of construction products in a way to contribute to their sustainable production and use leaves room for solutions being developed by the Member States or by industries, which contributes to the dysfunctionality of the internal market by generating potential barriers, fragmentation and incoherent approaches. 4.2.Subsidiarity: Necessity of EU action The deficiencies of the current CPR cannot be remedied by Member States’ laws as the Member States have no competence for revising the CPR framework nor for correcting its failures through national, or even regional, measures. EU action is therefore relevant and necessary. Only at EU level conditions to ensure the free circulation of construction products can be set whilst ensuring a level playing field. In particular, environmental protection objectives and climate performance of construction products are being addressed in different ways in the EU, considering also the different geographical and local conditions, and this variance in Member States' approaches to construction products’ sustainability and safety causes barriers to trade. An envisaged role for the EU should be to promote the development of a competitive internal market in construction products by removing any unnecessary disparities in regulation of performance of construction products, including environmental one, while allowing Member States to reflect their specificities in national building codes. Therefore, coordinated EU action can more effectively reinforce and supplement national and local actions, contributing in particular to construction products’ sustainability regarding climate performance and environmental protection. 4.3.Subsidiarity: Added value of EU action The revision of the CPR is expected to improve the overall functioning of the internal market for construction products, particularly by addressing the current issues relevant to the standardisation system and eradicating further barriers to trade, such as duplication or overlapping of regulatory provisions either at the EU or national/regional levels. This would in turn increase legal certainty as well as predictability and improve the level playing field for the construction industry. Trust in the entire system would be leveraged thanks to more streamlined market surveillance practices across the EU. Finally, the revision would address the aspects of environmental performance and circularity of construction products, which can only be tackled at the EU level, where the common technical language is being developed. The proposed measures are proportionate as they will not go beyond what is necessary to provide regulatory certainty while ensuring a high level of protection of safety and of the environment. EU action is therefore justified and necessary. 5.Objectives: What is to be achieved? The two general objectives of the revision are to: 1. Achieve a well-functioning internal market for construction products; and to 2. Make the framework apt to contribute to the objectives of the green and digital transition, particularly the modern, resource-efficient and competitive economy. These general objectives respond to the problems and the underlying drivers, as presented above. They build, on one hand, on the long-term experience gained during the implementation, showing areas of improvement; and on the other hand respond to the objectives of the industrial policy. The industry, operating in the EU market, needs harmonisation, legal clarity, adequate enforcement and reinforced market surveillance in order to benefit from the level-playing field and from the green and digital transition. These general objectives are complemented by the following specific objectives: 1.1. To deblock the technical harmonisation system; 1.2. To reduce national barriers to trade for products covered by the CPR; 1.3. To improve enforcement and market surveillance; 1.4. To provide more clarity (more comprehensive definitions, reducing overlaps, collision rules with other legislation) and simplification; 1.5. To reduce the administrative burden, including through simplification and digitalisation; 1.6. To ensure safe construction products;

2.1. To contribute to reducing the overall climate and environmental impact of construction products, including through the application of digital tools (Digital Product Passport). The below figure 4 presents the intervention logic.



Figure 4: Intervention logic 6.What are the available policy options? The intervention logic presented in Figure 4 illustrates the underlying drivers, the links between the problems the CPR is expected to address, the objectives assigned to it, the CPR’s policy options, and the sub-options. The content of each option (i.e. the detailed measures that form part of them) were analysed and consulted with the Member States, industry and other stakeholders . Not considered explicitly as an element of the options but essential to the delivery of the preferred option, is the question of the Commission’s administrative setup and capacity. Ambitious solutions can only be delivered if there are adequate resources in place to implement them. The current situation has, for example, demonstrated that delays have accumulated in the evaluation of CEN harmonised standards and EOTA deliverables resulting in legal uncertainty for the market and users, hindering the free circulation of construction products in the EU and impacting the competitiveness of manufacturers. The social dimension linked to the manufacturing of construction products (social conditions of production of construction products placed on the EU market) has not formed part of the options devised for the CPR revision. Firstly, because of their size and volume, the construction products are predominantly produced in the EU where no concerns linked to the social aspects of their manufacturing are known. Secondly, the envisaged Sustainable Corporate Governance initiative (SCGI) is considering the possible introduction of a general due diligence duty for companies of a certain size, covering human rights and environmental aspects related to all company activities (not a particular product) including the supply chain. Finally, the upcoming SPI considers the possibility of setting requirements on social aspects along the value chain of products. 6.1.What is the baseline from which options are assessed? The baseline scenario (referred to as “option A” during stakeholders’ consultations) implies no revision of the Regulation. This means the current CPR being in force, together with the entirety of the harmonisation system it put in place, hence including making use of all existing tools already at hand, i.e. Delegated Acts, Implementing Acts and harmonised standards. The baseline scenario means therefore a continuation of the harmonisation system and its implementation, e.g. dialogue and efforts to provide further guidance and streamlining the standardisation work; actions taken upon the national marks; promoting the understanding of the CPR; enhancing the market surveillance, through e.g. by recommending effective default market surveillance controls, within the framework of Regulation (EU) 2019/1020 on market surveillance. It is to be noted that the system, under the baseline scenario, would still to a very large extent be the one described in the evaluation and that some of the actions suggested in the evaluation have been taken, but failed to deliver. The likely evolution under the baseline scenario is reflected in section 3.2 (How will the problems evolve?). Under the baseline, it would be at most only partially possible to address climate and environmental performance aspects of construction products through the CPR (i.e. no reparability, no durability, availability of spare parts). However, this would require a much better performing harmonisation system. Therefore, more likely the SPI would have to address the goals stemming from the European Green Deal and the CEAP for construction products. Certainly, it would take a long time to cover a considerable number of construction products owing to their diversity. This would lead also to unnecessary additional administrative burden, with different aspects of the same product being regulated under different acts and through separate procedures. This could also put at risk the coherence between safety and sustainability aspects which is crucial considering the role of construction products in construction works. Individual Member States are also expected to compensate the lack of an EU-wide framework for sustainability and safety requirements for construction products by introducing uncoordinated approaches at the national level, thereby further deteriorating the internal market for construction products. 6.2.Description of the policy options This section provides a detailed description of each of the policy options proposed to promote a well-functioning internal market for construction products in the EU. The policy options, with the exception of Option E, are further able to make the framework apt to contribute (to a different extent) to the objectives of the European Green Deal. The below graph also presents the content of the different options and how they interact: Figure 5: Policy options

Amid increasing environmental and climate concerns, and particularly in the light of the need to support the European Green Deal, in case of a revision, the CPR provisions could better target the aspects of the environment and sustainable use of natural resources, while respecting Member States’ responsibility for the safety of construction works. In the 2020 survey, 56% of participants in the CPR Revision Technical Stakeholders’ Conference showed preference for inherent environmental product requirements to be integrated into the CPR and its harmonised sphere when asked about the preferred way that construction products can contribute to the transition towards a more sustainable built environment, in the frame of the European Green Deal. It was also supported by several participants that the EU regulatory requirements at the EU and Member States levels on information on the characteristics, contents and environmental impacts of construction products need to be strengthened. The Council and the European Parliament also called for stronger integration of circularity and environmental sustainability into the CPR. Option B – repairing the CPR Option B is designed as a stand-alone option aimed at addressing the issues highlighted in the evaluation and can thus be considered as an option of “repairing the CPR”. It covers measures aimed at addressing the problems and objectives identified in previous sections. These issues are numerous and often interlinked, hence the need of a significant revision in order to offer appropriate solutions. Consequently, option B can be regarded as an overhaul of the current CPR. In the context of option B, the following actions are foreseen: -To address the challenges of the technical harmonisation system, option B foresees introducing an empowerment for the Commission to rely on a ‘safety net’ (alternative/fall back) solution in case the standardisation system is not delivering standards in time and of sufficient quality. Such empowerment would allow the Commission services to draft Commission Acts containing technical specifications in support of the CPR. A similar approach is also available in other sectoral legislation, e.g. the Fertilisers Regulation, the Medical Devices Regulation, and in recent legislative proposals, e.g. the proposal for the Machinery Regulation. Additionally, the Member States will be requested to proactively identify their regulatory needs upfront, in view of reducing the number of iterations of standards developed. Furthermore, where delivered standards are incomplete or insufficient, the Commission would be empowered to act in such situations, to render the system functioning and efficient. Such a solution would imply that the development process of technical content will take place in a close dialogue and cooperation with the industry and Member States experts and other relevant stakeholders but will be under the lead of the Commission services. These Commission Acts containing technical specifications will have a status similar to the harmonised standards; the manufacturers of products covered by such specification would thus be able to draw up the Declaration of Performance and to acquire the CE marking, allowing to place respective products on the market. -Continued existence of national requirements and marks would be mitigated by clearly defining the area regulated at the EU level. In order to respond to new and urgent Member States’ regulatory needs, Option B would allow the Commission to modify by subsequent legal acts the exact borderlines of the ‘harmonised zone’, to quickly integrate those new issues, thus avoiding the needs for dedicated national marks. Transitional provisions would ensure that the harmonised standards cited under the current CPR would maintain their legal effect until they are replaced by new harmonised standards developed under the revised CPR. Furthermore, introducing provisions clarifying competences of the Member States and the interplay between the EU and the Member States’ level, e.g. with regard to unsafe or non-compliant products (e.g. right to sue, minimum benchmarks for market surveillance), is also part of this option. -Option B is enabling a harmonised framework to assess and communicate the environmental performance of construction products. This would take place in coherence with a horizontal approach on the environmental performance assessment of products, as currently developed within the SPI. General principles of such assessment will form part of the provisions, while the operationalisation of those principles per product family would be laid down in subsequent Commission acts, via standardisation. -To support the access to and use of the environmental product data, the setting up of a digital structure fully compatible with the Digital Product Passport (as foreseen by the parallel Sustainable Products Initiative), is of crucial importance. Easy access to coherent and transparent information on construction products will also be furthered through the use of digital tools, notably the Single Digital Gateway by Product Contact Points for Construction and by national authorities. -Under Option B, the revised CPR would also promote reuse of construction products, particularly to reduce the overall climate and environmental impacts. In particular, the CPR would support the placing on the market of certain used or used and remanufactured construction products, allowing such products to obtain CE marking and gain access to the European market. -Option B proposes to enhance market surveillance by strengthening enforcement powers and aligning the performance of different market surveillance authorities. The strengthening of enforcement powers would entail the introduction of appropriate sector-specific provisions to supplement the horizontal provisions contained in Regulation (EU) 2019/1020 on market surveillance and compliance of products. Moreover, it would aim to dispel interpretative confusion and facilitate the use of safeguard mechanisms, by creating procedures that are more streamlined (see Annex 12 with Refined indicative options paper for more details). The Commission will also be empowered to adopt delegated acts on the minimum number of checks to be performed by the market surveillance authorities of each Member State, as well as delegated acts on the minimum human resources to be deployed by the Member States for purposes of market surveillance with regard to products covered by this Regulation. These latter will be accompanied by a specific assessment of the resources implications. -In a similar vein, to further improve the enforcement at the national level, option B foresees enhancing harmonised decision-making amongst all authorities and Notified Bodies, striving for alignment across Member States and across groups of authorities/bodies. The Notified Bodies would also be strengthened with a capacity to assess the correctness of declared environmental impacts of construction products, through either designating specialised bodies or creating a responsible sub-group. Option B also foresees that a revised CPR improves the efficacy of Notified Bodies. -With a view to improve the clarity of the provisions, option B would aim at enhancing the definitions in order to make them more precise and comprehensible. In this sense, the provisions in the future CPR would also clarify e.g. the situation of 3D printing of construction products, where currently neither the seller of the 3D printing dataset nor the 3D printing service provider is a manufacturer in the meaning of the CPR. It would thus render the revised CPR future-proof and create a level playing field. -Prefabricated small houses (including built by 3D printing) would also be covered by the CPR. This would allow to build the same (types of) affordable houses in several Member States. -Similarly, overlaps with other EU legislation will be mitigated by introducing collision rules and ensuring coherence; additionally, wherever needed and relevant, the scope of the applicability of the future CPR will be adjusted (e.g. in relation to drinking water installations, currently covered under both the CPR and Drinking Water Directive – see Annex 10 for more details). To clarify the scope of applicability, avoid possible gaps and address the circularity objectives, option B would make sure obligations are extended over the supply chain to suppliers of the construction products and related services. -As a solution to the lack of clarity around the meaning of the CE marking, option B proposes the introduction of a specific marking for construction products (European Construction Product – ECP) to clarify that the marking refers primarily to performance declaration and not to conformity. -Option B foresees clarifying the simplification provisions and introducing an empowerment for the Member States to exempt micro-enterprises not trading across the borders from the obligations of the CPR. -Under option B, with a harmonised framework to assess, communicate and access the environmental performance of construction products and the promotion of the reuse of construction products, some of the SPI’s aims could be addressed in the CPR framework. However, option B does not allow to introduce product requirements. These requirements would need to be set under the SPI risking a fragmentation of legislation. -Option B addresses the issue of inherent product safety only indirectly, as the unblocking of the technical harmonisation system and an improved market surveillance would improve the quality of products. Option C – Focusing the CPR

Option C can be described as “focusing the CPR” – or reducing the scope of the application of the CPR, freeing up capacity to improve the quality and comprehensiveness of the remaining harmonised sphere. This option takes Option B as starting point, meaning that it builds on the elements described in Option B. However, in Option C the scope of application of the CPR is then limited in certain areas, depending on the following three sub-options which can be combined: ·Sub-option C1: Limiting the CPR’s application to assessment methods: Harmonised standards and Commission Acts containing technical specifications would include only assessment methods for performance calculation, with no performance threshold levels, classes nor other requirements to be established at EU level. ·Sub-option C2: Limiting the scope of the CPR: the scope of the CPR would focus on the core areas, identified according to three criteria: (1) the coherence of Member States’ regulatory needs, (2) the relevance for the environment or for product safety, and (3) market relevance. These criteria are thus not only applied by the Commission when setting priorities for preparing harmonised standards and Commission Acts containing technical specifications as described under option B, but already by the legislator when determining the overall scope of the CPR. Such an approach would allow to better focus on the regulatory needs of the Member States, the disadvantage being the lack of agility to adjust quickly the scope to respond to new harmonisation, safety or environmental needs. Mutual recognition principles would apply outside the core areas. ·Sub-option C3: Making the common technical language optional for manufacturers: Member States would have the option to offer an alternative path to market access based on national regulations and not relying on harmonised standards and Commission Acts containing technical specifications. In such a case, manufacturers could choose whether they use the common technical language under the CPR or the alternative (national) path to market access. However, if a manufacturer would choose to use the common technical language to assess and communicate performance of its products and affix the CE marking, Member States would remain obliged to offer market access to this product. Sub-option C1 alone would relate to the SPI similar as option B. However, under sub-options C2 and C3 a considerable number of construction products would not be regulated by the CPR. In particular, under sub-option C2 less products would be regulated under the CPR than today. Under sub-option C3 the same product could fall under the CPR or national regulations depending on the choice of manufacturer how to market it. Therefore, under C2 and C3 the SPI’s aims would have to be addressed by the SPI directly to avoid different sustainability approaches. This would lead to a complex regulatory structure for construction products with CPR, SPI, national regulations and the mutual recognition principle applicable. Option D – Enhancing the CPR Option D, “enhancing the CPR”, is triggered predominantly by the goals of ensuring a high level of safety and environmental protection, including circularity aspects. Option D foresees a process to introduce product requirements dealing with product inherent aspects when needed to protect health, safety and the environment. In this sense, Option D mirrors the expected requirements applicable under the future SPI (see Annex 11 for further details). While it further builds on Option B, relying on mandatory harmonised standards relevant for the assessment of products’ performance, it goes beyond this through provisions that empower the Commission to set, when needed, mandatory (minimum) requirements for products. Beyond these horizontal environmental and product safety requirements and obligations laid down in an Annex of the CPR, this product-specific requirements would be formulated via three sub-options/approaches (sub-options D1 and D2 could also be combined): ·Sub-option D1: To complement the horizontal environmental and product safety requirements and obligations laid down in an Annex of the CPR, sub-option D1 would formulate more specific product requirements based on the New Legislative Framework approach. For the products or product families concerned, essential requirements would be laid down in standardisation requests addressed to CEN, who would be mandated to develop standards providing technical details. These voluntary standards would be harmonised by referencing in the OJEU. Following the voluntary standards would lead to the presumption of a product's conformity with the relevant essential requirements, but other means to prove conformity would remain possible. As such, in the absence of essential requirements tailor-made to particular groups of products specified in Commission acts, it may lead to lack of harmonised approach towards assessing and demonstrating given performances. Divergence in product requirements between products following the harmonised standards path and products manufactured and tested according to other methods would imply additional effort needed on the side of the market surveillance authorities. ·Sub-option D2: It would formulate product requirements based on the technical specifications approach. Requirements would be included in harmonised technical specifications and be developed as under Option B, meaning either by mandatory harmonised standards (preferred) or by Commission acts containing technical specifications (as fall back). Where product requirements will be defined, the Declaration of Performance would be complemented by a Declaration of Conformity, and both would be combined in one document. ·Sub-option D3: Based on the feedback received during the public consultation and further deeper analysis of the legal constraints, a hybrid solution between sub-option D1 and sub-option D2 has been developed while keeping the core elements of the two other sub-options. These include: -As in the NLF, the product requirements (“essential requirements”) would be established by an Annex of the CPR. -However, as the requirements have to target more than 30 widely differing product families encompassing more than 100 product categories, they cannot be sufficiently specific to be applied without legal uncertainty. Hence, they would only become applicable once they have been specified for a certain product family or category by a Commission Act. This is an element stemming from sub-option D2. -As these Commission Acts may not cover all relevant aspects of application, voluntary standards based on standardisation requests may also be needed to complement them to providing more details and, eventually, presumption of conformity. This is an element stemming from sub-option D1 and the NLF. Against the ambitions of the European Green Deal and particularly, the transition towards a more sustainable built environment, Option D would be the one ensuring that all safety, circularity, sustainability and climate related aspects can be assessed under the CPR future framework, including the possibility to put forward product requirements. Option D is therefore fully aligned with the SPI and does not require the SPI to prioritise the construction products. Option E – repealing the CPR Option E would imply relying on mutual recognition for the internal market of construction products. There would be no harmonisation, i.e. no common technical language, no mandatory harmonised standards, no voluntary harmonised standards either, no basic work requirements for construction works, no obligation to draw up a Declaration of Performance or communicate it, no CE marking, no classes or thresholds, no AVCP systems and no conditions for classification determined at EU level. This would extend to all construction products the situation currently existing for the non-harmonised sphere. Therefore, under option E, climate and environmental performance requirements at EU level would have to be set by the SPI. As consequence, even without a CPR there would be EU requirements targeting construction products, this time stemming from the SPI. While Member States would be free to come up with their own national requirements, the principle of mutual recognition would imply that they cannot simply refuse market access, if products from a different Member State do not comply with these requirements. Instead, they would need to check whether the products were marketed in accordance with the national rules applicable in the Member State in which they were manufactured. Additionally, Member States could adopt national regulations relevant for construction works where certain performance criteria could be envisaged for certain conditions (e.g. reflecting climate change risks).

Problem drivers Specific Objectives Option A Option B Option C Option D Option E Problem 1 drivers -Mismatch between the legal criteria applied by the Commission and the ability of standardisers to deliver requested outputs - Lack of alternative whenever the standardisation process is not delivering - Incomplete character of harmonisation Problem 4 drivers - 3D printed products escape the scope of CPR Deblocking the technical harmonisation system ·Apply the existing empowerments and procedures. ·Introducing empowerment for the Commission foreseeing alternative (safety-net) solution, to draft technical specifications where no timely and/or quality standards are delivered, i.e. developing technical content in a close dialogue and cooperation with the industry and Member States experts and other relevant stakeholders; ·Member States will be requested to proactively identify their regulatory needs upfront, with a view of reducing the number of iterations of standards developed. ·The same as option B in the remaining harmonised sphere. ·The same as option B. ·As there will be no harmonisation, only mutual recognition, no mandatory nor voluntary harmonised standards would be necessary. To ensure safe construction products ·No change. ·Indirectly addressed with improved market surveillance and unblocked technical harmonisation system. ·Bringing 3D-printed products in the scope of CPR ·The same as option B in the remaining harmonised sphere. ·Setting a dedicated process to introduce product inherent safety requirements, where needed complemented by more specific product requirements (per categories or group of products) by either; ®D1 – New Legislative Framework approach for product requirements; ·D2 – Technical Specifications Approach for product requirements. ·D3 – Hybrid of D1/D2 ·The CPR repealed and mutual recognition applying, hence no harmonised sphere. Problem 2 drivers - Lack of clarity of the current provisions - Lack of appropriate resources to tackle the non-compliance effectively Reducing national barriers to trade for products covered by the CPR ·Act upon national marks, ex-ante processes and verifications, including infringement procedures and support for economic operators acting against infringements at national courts. ·Introducing provisions clarifying competences of the Member States and improving the interplay between the EU and the Member States’ level, e.g. with regard to unsafe or incompliant products. ·The same as option B but also with changes to the scope of the CPR to free up capacity and improve the quality and comprehensiveness of the remaining harmonised sphere: ®C1: Scope of the CPR limited to assessment methods only (no thresholds, classes nor other requirements at EU level); ®C2: Focusing the scope on regulatory needs of the Member States, with limited agility towards new needs; ®C3: Giving the Member States the possibility additionally offer market access based on national regulations. ·The same as option B but also covering inherent product safety requirements at EU level (horizontal mandatory minimum safety requirements for products, where needed complemented by more specific product requirements per categories or group of products). ®D1 – New Legislative Framework approach for product requirements; ®D2 – Technical Specifications Approach for product requirements; ®D3 – Hybrid of D1/D2. ·The CPR repealed and mutual recognition applying, hence no harmonised sphere. Improving enforcement and market surveillance ·Recommending highly effective default/standard market surveillance controls. ·Strengthening enforcement powers and aligning the performance of different market surveillance authorities; ·Creating more streamlined procedures to address interpretative confusion and facilitate the use of safeguard mechanisms; ·Delegated acts on minimum number of checks performed by the market surveillance; ·Delegated acts on minimum human resources to be deployed for the market surveillance of construction products; ·Enhancing harmonised decision-making amongst all authorities and Notified Bodies, striving for alignment across Member States and across groups of authorities/bodies; ·Strengthening the capacity of Notified Bodies to assess the correctness of declared environmental impacts of construction products. ·The same as option B in the remaining harmonised sphere.B. ·The same as Option B. ·No CPR in place, authorities checking whether the products were marketed in accordance with the national rules applicable in the Member State in which they were manufactured. Problem 3 drivers - Low awareness and lack of clarity of the simplification provisions Problem 4 drivers - CPR does not foresee broad application of digital tools Providing more clarity and simplification ·No change. ·Introducing an empowerment for the Member States to exempt conditionally certain micro-enterprises from the obligations of the CPR; ·Clarify the simplification provisions; ·Eliminating information overlap between the CE marking and the Declaration of Performance; ·Combining the Declaration of Performance with the Declaration of Conformity; ·Enhancing the definitions in order to make them more precise, thorough and comprehensible; ·Clarifying possible loopholes or overlaps with other legislation, including through clear collision rules and clarifying the scope; ·Introducing specific marking for construction products (ECP instead of CE marking); ·Ensuring access to comprehensive information in a digitalized manner, through Single Digital Gateway. ·Access to a common database, via Digital Product Passport, to ensure information is stored in a comprehensive and durable manner. ·The same as option B in the remaining harmonised sphere, but also: ®C2: Focusing the area of application and/or scope to core areas, hence limiting possible overlaps; ®C3: The possibility of an alternative national path to market access is creating new regulatory overlaps. ·The same as option B. ·CPR repealed, no need for simplification provisions at the EU level. ·Manufacturers have to market products in accordance of national rules. Reducing the administrative burden, including through simplification and digitalisation · · · · · Problem 4 drivers - Inability to deliver on the policy objectives stemming from the European Green Deal and the Circular Economy Action Plan -Absence of references to sustainability performances - Unable to cover new business models - CPR does not foresee broad application of digital tools Contributing to the reduction of the climate and environmental impact of construction products, including through the application of digital tools ·It would not be possible to address environmental performance aspects of construction products or product requirements through the CPR but through SPI. Individual Member States might introduce additional uncoordinated approaches at the national level. ·Enabling a harmonised framework to assess and communicate the environmental performance of construction products; ·Possibly additional sustainability product requirements from SPI; ·Promoting and incentivising the reuse of construction products, through communicating their performance down the use-chain until the preparation of used products for re-use and their second making available on the market. ·The same as option B in the remaining harmonised sphere, beyond this ·C1: Enabling a harmonised framework to assess and communicate the environmental performance of construction products; ·C1: Possibly additional sustainability product requirements from SPI; ·C2/C3: SPI would have to address environmental performance aspects of construction products or product requirements. ·The same as option B; plus ·Setting a dedicated process to introduce product inherent requirements in order to enhance environmental protection (horizontal mandatory minimum requirements for products, where needed complemented by more specific product requirements per categories or group of products) by either; ®D1 – New Legislative Framework approach for product requirements; ®D2 – Technical Specifications Approach for product requirements; ®D3 – Hybrid of D1/D2. ·No environmental performance requirements at EU level stemming from CPR but most likely from SPI and Individual Member States might introduce additional uncoordinated approaches at the national level. 6.3.Options discarded at an early stage Due to an extremely critical feedback and the fact that certain legally mandatory objectives can, in the case of the CPR, not be reached by voluntary standards, the possibility of relying entirely on voluntary harmonised standards has been limited in terms of scope to the question whether inherent product requirements shall be established by voluntary standards, as under option D1, and also be functionally replaced by sub-option C3. Moreover, the suggestion of a Member State to limit Option B to only a few core elements has been discarded for the following reasons: there are multiple links among the problems and objectives to be addressed. Due to these manifold interrelations, it was necessary to consider potential mitigation for each of the numerous horizontal issues identified. For further information, see Annex 13 on the discarded options. 7.What are the impacts of the policy options? This section analyses the policy options described in the preceding section, and assesses how they contribute to reaching the specific objectives. It presents particularly the economic, social and environmental impacts, as well as stakeholders’ views. The analysis is quantitative whenever possible, otherwise qualitative. Regardless of the options, the most relevant stakeholders affected by the Regulation in relation to obligations and compliance are the economic operators (manufacturers of construction products). Also affected is the construction ecosystem (construction companies and employed construction workers as the main users of the products). A small number of construction products is sold in hardware stores. Therefore, also consumers might be directly affected. The options have also an impact on Member States’ authorities responsible for the supervision of the safety, environmental and energy requirements applicable to buildings and civil engineering works. The main costs for the manufacturers to comply with the Regulation are administrative burden, substantive compliance costs and regulatory charges. While some quantification of these costs was presented in the study supporting this impact assessment, certain limitations such as low response rate and lack of detailed feedback on the nature of the costs incurred, affected the analysis of economic impacts. Wherever needed, this analysis is complemented with a qualitative analysis of the options. All other costs are presented in a qualitative manner due to the lack of data. The analysis of environmental impacts and social impacts (especially safety) was carried out in a qualitative manner and whenever data was available in a quantitative manner. With respect to the social impacts, benefits could not be quantified due to the missing data on safety incidents and other data needed for a quantification of risks on health and safety with regards to construction products. Therefore, the impact assessment also includes non-quantified social and environmental benefits and drawbacks. 7.1.Option A – baseline (no revision) Economic Impact No change in the CPR implies that the costs for businesses associated with maintaining the CPR will remain initially unchanged. The study estimated these costs for manufacturers to be approx. 2.56 billion EUR annually . This corresponds to 0.6% of the revenue of these. Previous studies of the costs for the CPR-related manufacturing sector in the EU estimated the annual baseline costs to be between 2.6 and 3.4 billion EUR - so roughly the same magnitude. These costs are mainly driven by the administrative burden (estimated at 900 million EUR), substantive compliance costs (estimated at 450 million EUR) and regulatory charges (estimated at 300 million EUR) due to CE marking and Declaration of Performance, and compliance cost due to national requirements of around 300 million EUR . These costs serve as the comparative basis for the other options in order to provide an indication of the expected economic impacts of the different options. The supporting study also estimated for the baseline a foregone revenue for EU manufacturers associated with the shortcomings in market surveillance of more than 4 billion EUR annually, corresponding to a little more than 1% of the overall revenue. The findings show that foregone revenue due to competition from non-compliant products is substantial, whereas costs related to identifying and reporting non-compliant competing products can be neglected as part of the aggregate result. Insufficient or ineffective market surveillance appears to be the reason for this significant impact on medium and small companies and the reason behind this might be that they have fewer brands/products with smaller volume, compared to large companies with stronger brands and wider portfolio. This makes small and medium companies more vulnerable and exposed to a bigger impact from unfair competition. In the online survey of 2018 , respondents were divided about the future development of these costs under the baseline: manufacturers and national contact points expected a small increase in cost, while testing and certification bodies, market surveillance authorities and end-user organisations expected a small decrease. Social impact

The current CPR is following a performance-based approach, meaning that no product requirements for construction products are established within the regulatory framework. Consequently, no particular impact on product safety can be identified. Inherent product safety will continue to be dealt with in an inconsistent manner by Member States and potentially in contrast to the objective of removing technical barriers. This has been confirmed by the 2018 online survey, where under the baseline all stakeholder groups expect either no (28%) or a small positive impact (26%) on health and safety . Environmental impact As explained in the problems section, harmonisation provided by the current CPR falls short of covering completely the Basic Work Requirements relevant for environmental impact or sustainability, therefore the construction products are not subject to mandatory assessment and verification of the constancy of performance in these areas. Therefore, at best only a slightly positive environmental impact would be expected from the CPR. In view of the political priorities of the EGD and linked initiatives, this may create an obstacle for the sector to contribute and to benefit from the green transition, while also impeding the national authorities from setting measures towards use of greener construction products and greening of construction works. As possible solution, these aspects could be addressed, if needed, under the SPI. This however, may result in unnecessary additional administrative burden, with different aspects of the same product being regulated under different acts and through separate procedures. This could also put at risk the coherence between safety and sustainability aspects which is crucial considering the role of construction products in construction works. Stakeholders’ views Feedback received during the public consultation and the company survey reflects a broad preference for the baseline (Option A) across most stakeholder groups. At the same time, many of these stakeholders also wished for action to be taken to resolve the issues linked to the implementation of the CPR – such action would require a solution closer to Option B or D. During the survey on the Refined indicative options paper, in general, participants have shown concerns about the economic consequences that changes to the CPR (the options apart from option A) would mean for the construction products industry. Participants which were in favour of option A, feared that changes would delay the application of the CPR and create difficulties on the market . In a similar line, stakeholders outlined that changes in the CPR would result in the need for economic operators to mobilise further resources at a time when most of them are weakened by the Covid-19 crisis and that most companies in the sector were micro or small sized and changes were costly for them . 7.2.Option B - Repairing the CPR Economic impact Option B addresses all the issues identified in the evaluation as shortcomings in the implementation of the CPR. It would therefore contribute to improved harmonisation at the EU level, facilitating the circulation of construction products on the internal market and benefitting their manufacturers and users. In particular, it is expected that market access would be facilitated and the harmonisation of the internal market for construction products would be deepened. At the same time, substantial benefits are expected to come along with improved market surveillance and enforcement. The possibility of introducing, by delegated acts, minimum number of checks to be performed by the market surveillance and the minimum human resources deployed for market surveillance of construction products is expected to significantly improve the effectiveness. Such delegated acts will be accompanied by a specific assessment of the resources implications. Option B also offers some reduction of administrative burden for manufacturers by empowering the Member States to exempt certain micro-enterprises from the obligations under the CPR, by reducing overlap between the CE (new ECP) marking and the Declaration of Performance; allowing the DoP to be supplied electronically and by combining the DoP with the Declaration of Conformity (DoC). The estimates show that a regulatory shift towards Option B would lead to a total reduction of 160 million EUR in costs annually for construction products manufacturers, roughly corresponding to a 6% reduction compared to the baseline compliance costs. This impact is driven mainly by a decrease in the administrative burden, substantive compliance cost and regulatory charges in relation to the CE marking and Declaration of Performance, and in substantive compliance cost stemming from reduced national requirements. This may not be overwhelming, but nevertheless a non-negligible expected reduction in costs. Relying on digital tools, such as a Construction Products database or system will provide the information along the distribution chain, increasing the transparency to the benefit of safety and the environment and save resources of the economic operators, while also ensuring an interface with the Digital Product Passport, ultimately improving the system’s efficiency. Overall, Option B is expected to improve the effectiveness, efficiency and coherence of the regulatory framework. There appear to be significant benefits that can be reaped from improved market surveillance, with a potential 2.5 billion EUR annually to be gained in terms of revenue, equalling more than half the costs (burden) under the baseline. Notwithstanding the significant uncertainties associated with this estimation due to the small number of observations that it is based on, this would be a remarkable result. Notably, about half of this benefit accrues to small companies, where aggregated revenue gains are estimated to amount to roughly 1.3 billion EUR annually corresponding to 1% of the total revenue for that group. The above suggests that the improvement in market surveillance would lead to significant benefits, which together with harmonisation of decision-making of authorities and Notified Bodies should also enhance the legal certainty as regards the role and obligations of economic operators and Notified Bodies. This, in turn, could increase the assurance that compliance with the legal rules and requirements benefits the operators and enhance the functioning of the internal market. Social impact Improving the market integration of construction products would contribute to enhanced access to these products across different Member States, benefitting the users and consumers. Thanks to the improved legal clarity of the framework and harmonised methods for assessing and communicating environmental performance the users would have access to reliable information on the performance of construction products, eventually contributing to more conscious and informed choices made, particularly in terms of construction works to be executed. Better streamlined market surveillance and enforcement is also expected to improve the reliability of performance declarations, increasing the users’ trust. Moreover, including in the scope of the CPR also prefabricated (small one-family) houses would allow the creation of an internal market for entire small houses, permitting economies of scale and increasing competition, thereby favourably influencing the prices, ultimately fostering their affordability and deployment. Pre-fabricated houses could also be an important factor when addressing crisis social situations, like in the aftermath of recent weather-related disasters where citizens were in urgent need of housing solutions.

Respondents to the public consultation (see also Annex 2), who prefer option B, primarily expect it to lead to an increase in construction product innovation, construction product safety, and economic actors’ compliance with relevant rules and regulations. Environmental impact A harmonised method for assessing and communicating the climate and environmental performance of construction products would contribute to the green transition of the sector and to a better built environment, by providing the relevant environmental data allowing the Member States to assess the climate and environmental performance of construction works, thereby supporting the implementation of relevant national and EU legislation (e.g. the Energy Performance of Buildings Directive) and avoid market fragmentation. Respondents in the consultation who prefer option B primarily expect it to lead to an increase in the sustainable use of resources for producing construction products and the quality of the built environment in the EU. Stakeholders’ views The only stakeholder group preferring option B overall was EU citizens. However, in relation to multiple elements, NGOs and public authorities also prefer Option B, this particularly in terms of improvements on market surveillance and enforcement. Business associations and companies/business organisations do not prefer option B altogether. During the survey on the option paper, stakeholders pointed out that they welcomed the Commission’s initiative to review the CPR with the aim to improve the functioning of the single market for construction products, but the feared that a revision of the CPR would require additional resources (manpower and finances) from industry to adapting to new procedures and processes . 7.3.Option C - Focusing the CPR Option C builds on Option B, to the extent there is compatibility between the two. Option C includes three additional sub-options, which can be combined. The impacts of this option can then be considered comparable to those of Option B, where compatible (e.g. improvements in area of market surveillance, legal clarity, simplification etc.). At the same time, sub-option C1 would mean focusing the CPR’s scope on assessment methods only, with no performance thresholds nor characteristics established at the EU level. This in the end would not improve the degree of harmonisation at the EU level, nor would it be the case when focusing the CPR on core areas only (sub-option C2); further national provisions would emerge, thereby creating possible obstacles to the free circulation of construction products within the EU. Economic impact According to the estimates of the study, option C (the three sub-options combined) would lead to a small reduction of 23 million EUR annually in costs for manufacturers asso