RICS have introduced new mandatory requirements on conflicts of interest for the UK land, property, construction and infrastructure industry.
RICS is tightening up requirements for professionals and regulated firms working in land, property, construction and infrastructure, with the publication of a new UK professional statement on conflicts of interest.
The UK-specific professional statement, following on from RICS global guidelines and the IPF Protocol: Open Market Investment Agency (November 2014), for the commercial property investment market bans the controversial practice of dual agency – known colloquially as ‘double-dipping’. Both standards will be effective from 1 January 2018.
The standard states that: “dual agency must not be undertaken under any circumstances. For the avoidance of doubt, RICS members working within non-RICS regulated firms are subject to the same criteria as regulated firms when undertaking dual agency in the UK under any circumstances.”
The Professional Statement also covers multiple agency – where an agent has competing contractual relationships simultaneously with several buyers, and the provision of incremental advice – e.g. planning, building surveying, valuation related to a purchase or disposal that is incremental to an existing instruction to advise the buyer/s or seller.
The new standard was developed as the result of an extensive consultation that saw industry professionals and regulatory experts offer their views and the new requirements address concerns around the dual agency practice, providing both greater confidence for investors and increased clarity for RICS professionals.
Following launch of the global statement and the UK-specific statement, RICS will seek to consult on the requirement for further market specific standards.
Already, some of the best-known commercial property firms, such as SEGRO, JLL, CBRE, and Land Securities have indicated their support for the new standards.
“As a member of the RICS Working Group, I am pleased to endorse these new rules and guidance which are an important step forward for the property industry in inspiring trust amongst clients and the public in the way we do business,” said Stephen Hubbard, Chairman of CBRE UK. “JLL will always work in the best interests of our clients and integrity within the investment market is fundamental to the protection of all clients. The RICS professional statement will reassure our clients and the public that we have effective procedures and controls in place and will stick to them.”
Chris Ireland, JLL UK CEO, said, “RICS believes that it is uniquely placed to provide world-class standards for a global profession in land, property, construction and infrastructure. Regulating the profession in a way that holds it to this promise is vital to inspire confidence among clients and the public.”