Introduction
Perfluoroalkyl and polyfluoroalkyl substances refers to a group of manufactured chemicals that are widely used in industrial settings and everyday products, commonly known as "PFAS".1 The concerns around PFAS stem from both its ubiquity in the manufacturing process, as well as its inability to naturally breakdown in the environment, hence the colloquialism "forever chemical". The range of its use is vast — PFAS is utilised in industrial processes like automative and aviation manufacturing, defence and aerospace activities and construction materials, as well as the production of household items like cosmetics, cleaning products, food packaging and processing, and cookware (like non-stick pans).2 Long after these products have disintegrated in landfills, PFAS stays on in surrounding air, water, sediments, plants and wildlife.3
Due to its widespread use, health and environmental concerns are mounting. The UK Environment Agency detected PFAS in 96% of surface water samples, illustrating the current rates of contamination.4 While the extent of harm exposure to PFAS causes is the subject of ongoing study, there is a growing list of disease categories with "probable links" to PFAS.5 Exposure has been linked to testicular cancer, kidney cancer, high cholesterol, ulcerative colitis, obesity, thyroid disease, fertility issues, pregnancy-induced hypertension and birth defects.6 Against this backdrop, there is ongoing legal and political debate as to how to best regulate the chemical's use to limit potential harm, whilst simultaneously contending with the commercial impacts of regulation on the manufacturing and industrial sectors.
UK commercial context
In the last 5 years, PFAS contamination concerns entered the mainstream UK transaction market due to increased media interest and awareness of former site uses with 'presumed PFAS status', development of threshold limits and scientific guidance, improved PFAS testing and PFAS-specific training for regulators.7
A report prepared by Jacobs UK Ltd in July 2023 for the EA was recently made public due to a request under the Environmental Information Regulations 2004.8 The Jacobs Report estimates that there are between 2,900 and 10,200 high-risk PFAS sites in England, amounting to up to 672,000,000m2 of affected areas.7 The financial modelling undertaken in the reports shows remediation costs for these high-risk sites could amount to between £31 and £121 billion.9 The number of PFAS-impacted sites is even higher, and the report categories some industries as having 'presumed PFAS' sources, including automative, electronics, waxes, paint and inks, plastics, cleaning products, cosmetics and sewerage.10 This potentially exposes all of the industries involved in the manufacture and use of PFAS to further regulation and possible liability in future legal proceedings.
For further detail on the nature of the PFAS problem in the UK and the financial scale and burden of the problem, please read the full report.7
Current regulatory regime
The regulatory regime with oversight of chemicals manufactured or imposed into the UK is Assimilated Regulation (EC) No 1907/2006, or UK REACH.11 The majority of PFAS are industrial and consumer chemicals and are therefore regulated under this regime. On 4 April 2023, 36 individual PFAS were registered under UK REACH.12 The Health & Safety Executive (HSE), as the agency for UK REACH, anticipates that another 40 will be registered.13
PFAS was identified as a key priority for UK REACH in 2023/24 and there is an intention for the following regulatory priorities to be actioned under the new government:
- Act on the PFAS Regulatory Management Options Analysis (RMOA) recommendations, undertake an assessment of PFAS used as processing aids to consider if PFAS should be categorised as a "substance of very high concern" (SVHC).
- Prepare a restriction dossier on PFAS in fire-fighting foams.
- Assess potential additional restrictions on further wide dispersive uses of PFAS and PFAS likely to be released from consumer articles.14
The Stockholm Convention is implemented in the UK by Assimilated Regulation (EU) 2019/1021 (the UK POPs Regulation).15 This regulation prohibits manufacturing substances listed in Annex I and places restrictions on substances listed in Annex II to the Regulation.16 A number of reforms to the UK POPs Regulation have been contemplated by the government, who have shared their intention to proceed with changes, including to remove certain specific exemptions for PFOA and PFOS.17 Breaches of the UK POPs Regulation are enforceable under statute.18
Beyond these regimes, there are numerous other statutes which may operate to further restrict the production and use of PFAS in the UK, including regulations pertaining to hazardous substance classifications, chemicals in food and food contact materials, environmental permits, contaminated land, and water quality.19
The Department for Environmental, Food and Rural Affairs (DEFRA) has convened the PFAS Chemicals Stakeholders Forum (CSF) Working Group to inform policy development. UK-based NGOs are calling for a comprehensive PFAS action plan as part of the future UK Chemicals Strategy to achieve a "PFAS-free economy" in the UK in the next decade, so it is likely that there is significant reform to come.20
Litigation Lens
The jurisdiction of the US has so far seen the highest concentration of PFAS-related litigation. In 2023, there were 15 active legal actions brought by separate US state attorney-generals against companies for PFAS contamination.21 In 2024, US courts approved a $393m settlement between chemical company Solvay and the New Jersey Department of Environmental Protection, a $1.185b settlement between chemical companies Chemours, DuPont and Corteva and US Water Systems, and a $12.5b settlement between 3M and public water suppliers.22 Along with PFAS manufacturers and distributors, the US has also seen litigation targeting 'secondary' defendant groups further along the supply chain. Actions have been brought against "purposeful PFAS polluters" like local processors and waste management centres, as well as against companies and government bodies who utilise products containing PFAS.23
While the quantity of PFAS-related litigation in the US can somewhat be explained by its more claimant friendly set-up, the regulatory and judicial precedent emerging from beyond US borders emphasises the global scope of the issue. In 2023, the Australian Government settled a class action with 30,000 landowners whose properties were contaminated by firefighting foams containing PFAS on air force bases. The Federal Court of Australia approved a $132.7m AUD settlement amount to compensate the class for diminution in property value and inconvenience, distress and vexation.24 Closer to home, there are PFAS cases being litigated in six separate European countries. In Belgium, 3M agreed to pay €571m to the government for clean-up costs associated with PFAS contamination25, and in the Netherlands, there are civil proceedings against Chemour for alleged unlawful activity as well as collective action against the government demanding stricter chemical controls.26 In the personal injury context, the Swedish Supreme Court concluded that high PFAS levels found in an individuals' blood stream can be considered an injury, even without the claimant showing any symptoms of sickness.27
While the UK has not yet been subject to PFAS-related litigation, recent Supreme Court decisions pertaining to environmental contamination leave the door ajar for claimant groups. Recent judgments in Jalla v Shell28 and Manchester Ship Canal Company v United Utilities Water29 contemplate the common law rights of parties to make claims against companies for environmental contamination, representing a significant shift in judicial thinking.
How can landowners and developers manage PFAS risks?
Landowners/site operators and developers can put in place a number of steps to mitigate against risks relating to PFAS to include:
- Complete an initial desk top review of sites owned and/or to be developed to identify potential risks and prioritize them
- Identify any sites where PFAS containing materials may still be used/present and develop and appropriate management plan
- Ensure early information or investigation into the presence of PFAS when developing or purchasing sites
- Evaluate costs of treating or removing PFAS-contaminated soil, water or waste prior to committing to projects or to incorporate with ongoing projects/operations
- Keep up to date with guidance — useful sources include the Environment Agency website and CIRIAs specific PFAS update web page.
- Engage with Regulators at an early stage for both land owned or operated and to be developed
- Engage with insurers to determine if cover is available for PFAS risks
Insurance cover for PFAS/PFOS
Insurance companies have begun to utilise PFAS-specific exclusions across many insurance classes, however, the coverage implications for PFAS-related liabilities can vary depending on the specific facts and language of the policies.
PFAS exclusions in general liability policies are rapidly becoming standard. These exclusions specify that the insurance does not, for example, cover any bodily injury and property damage related to PFAS exposure, or the design, manufacturing, sale, or disposal of PFAS-related products.
Specific Environmental impairment liability (EIL) policies that can cover Brownfield sites, contractors and business operations but vary on their approach. In the UK, some EIL insurers started to exclude PFAS cover, whilst other insurers will look at it on a site/project specific basis.
