Fixing peeling paint on timber cladding
There are multiple reasons for outside paint to peel and crack.  It can be hard to pin down if it is a application issue or just an outside factor.  But as you state it was applied on newly installed (non-aged) wood has me tending toward that aspect.  

Based on the product data sheet DATA SHEET the following is listed, "Pressure
treated timber should be weathered for 6 months. Denatured wood
should be abraded to reveal new cells. Any new finished wood needs
to be abraded."  So was the wood sanded prior to the first coat?
I myself would lean toward this thought if I was more familiar with the paint itself. This would be do to the fact I do not see paint staining of the cells in the underlaying wood where the peeling has occurred, fresh sanded cells can fill with the paints pigments.  

If a primer was used was it of the proper type for the paint could be another issue.  With peeling more on the sunny side paint expansion and primer expansion should be matched.  

This info may help you with other possibilities. WHY PAINT PEELS

If the surface prep (sanding) was not achieved then I would scrape and sand off the old paint and abrade the wood, then reapply new.  I would not just scrape off the loose and paint over it all for fear of old that remains would peel under the new.