Client Money Protection

Transcription

1 Regultion Client Money Protection With effect from 1 April 2019 rics.org/regultion

2 rics.org/regultion Contents Appendix 1: Rules of the RICS Client Money Protection Scheme for Surveying Services... 2 Tle of Contents... 3 Rules of the RICS Client Money Protection Scheme for Surveying Services Defined Terms... 4 Scheme purpose nd pprovl... 7 Scheme Memership... 7 Client money... 8 Compenstion for loss of Client Money... 9 Generl mtters Annex: Compenstion Limits Appendix 2: Rules of the RICS Client Money Protection Scheme for Property Agents Tle of Contents Rules of the RICS Client Money Protection Scheme for Property Agents Scheme Memership Client money Compenstion for loss of Client Money Generl mtters Annex: Compenstion Limits Appendix 3: TDS Deposits Effective from 1 April 2019 i

3 Client Money Protection ii Effective from 1 April 2019

4 rics.org/regultion In this document we set out the detils of the vrious RICS client money protection provisions which pply to RICS Registered Firms. 1. RICS Client Money Protection Scheme for Surveying Services Except in respect of client money covered y the Property Agents Scheme to which prgrph 2 refers, the client money protection rrngements set out in Appendix 1 pply in respect of client money held y RICS Registered Firms. 2. RICS Client Money Protection Scheme for Property Agents Specific provisions pply in respect of Property Agents from 1 April 2019 in respect of Client Money (s defined in Appendix 2) held in connection with letting gency work nd property mngement work in Englnd (s set out in the Property Agent definition in Appendix 2). Plese note therefore tht the specific provisions relting to client money protection for Registered Firms which re Property Agents undertking such ctivities in Englnd will pply s set out in Appendix 2 for the hndling of such Client Money nd for possile compenstion for loss of such Client Money. The Rules of the RICS Client Money Protection Scheme for Property Agents re set out in their entirety in Appendix 2 nd comprise the rules of tht Scheme which hve een pproved y the Secretry of Stte of the Ministry of Housing Communities nd Locl Government nd comply with the specific provisions of the Client Money Protection Schemes for Property Agents (Approvl nd Designtion of Schemes) Regultions TDS Deposits Tenncy Deposit Clims for which there is protection either under y scheme operted y the Dispute Service Limited (TDS) or y TDS Northern Irelnd (TDSNI) relting to the collection of holding tenncy deposits for gents nd lndlords re dministered seprtely from the ove schemes. Effective from 1 April

5 Client Money Protection Appendix 1: Rules of the RICS Client Money Protection Scheme for Surveying Services This Appendix sets out the rules (the Rules") of the generlly pplicle RICS Client Money Protection Scheme for Surveying Services ("the Scheme"). These re the specific provisions which pply in reltion to protection of client money held y RICS Registered Firms in connection with ll of their ctivities in the United Kingdom which the RICS requires ll of its Registered Firms to follow. This is suject to n exception for ny RICS Registered Firm which, s ll or prt of its usiness, conducts the usiness of cting s residentil property gents in Englnd. Such Registered Firm will, in respect of client money which flls within the terms of tht Scheme s defined in Appendix 2 (client money held y Property Agent in respect of letting gency work nd property mngement work in Englnd), insted e suject to the specific rules of the RICS Client Money Protection Scheme for Property Agents set out in Appendix 2. These Rules re dditionl to the RICS Rules of Conduct which pply to n RICS Registered Firm. 2 Effective from 1 April 2019

6 rics.org/regultion Tle of Contents Rules of the RICS Client Money Protection Scheme for Surveying Services Defined Terms... 4 Scheme purpose nd pprovl... 7 Scheme Memership... 7 Client money... 8 Compenstion for loss of Client Money... 9 Generl mtters Effective from 1 April

7 Client Money Protection Rules of the RICS Client Money Protection Scheme for Surveying Services 1 Defined Terms 1.1 In these Rules relting to the generlly pplicle RICS Client Money Protection Scheme for RICS Registered Firms for ll of their ctivities, the following terms nd expressions shll hve the following menings (unless the context otherwise requires): "Clim" "Client" "Client Money" clim for compenstion y Client of Memer under the Scheme in ccordnce with the clims procedures in Rule 11 memer of the pulic which is client of n RICS Registered Firm A memer of the pulic includes ny person, firm, trust, ody corporte or other orgnistion. money of ny currency (whether in the form of csh, cheque, drft or electronic trnsfer). which Registered Firm holds or receives for or from Client, including money held y Registered Firm s stkeholder; nd. which is not immeditely due nd pyle on demnd to the Registered Firm for its own Account ut excluding for the purposes of this Scheme. money of ny currency (whether in the form of csh, cheque, drft or electronic trnsfer) held y n RICS Registered Firm s TDS Deposits for detils of which plese refer to Appendix 3;. fees pid in dvnce for professionl work greed to e performed, nd clerly identifile s such. However, commissions or other pecuniry rewrd or other dvntge received from nyone other thn the Client which re not permitted y ny relevnt regultor to e received or retined y the Registered Firm, nd for which the Registered Firm hs to ccount to such Client, will e regrded s client money for the purposes of this Scheme nd so will not e excluded y reson of this su-prgrph. 4 Effective from 1 April 2019

8 rics.org/regultion in respect of the Scheme, n ccount which: "Client Money Account" "Client Money Levies" "Closing Dte" "Compenstion Limits" "Finncil Yer" "Insurer" "Memer" or "Scheme Memer" "Property Agents Client Money Protection Clim" "RICS" "RICS Registered Firm" "RICS Rules of Conduct". does not contin ny sums other thn the whole or ny prt of client money pid into it, or such sums of money s my e necessry to replce ny sum which y error hs een withdrwn from the ccount, together with ccrued interest on such mounts; nd. includes in its title the word "client" or n pproprite revition of tht word, nd whether such ccount is held in the nme of the Registered Firm or wholly owned susidiry compny of the Registered Firm tht holds money in respect of the Registered Firm in respect of the Scheme, levies pid y Memer of the Scheme pursunt to Rule 5 the dte on which the Scheme ceses to provide client money protection in ccordnce with the terms of the Scheme, nd so the dte on which the Scheme is closed in ccordnce with Rule 12 the compenstion limits determined y the Scheme Administrtor on the sis set out in Rule 9.3, nd set out in the Annex to these Rules, s mended y the Scheme Administrtor from time to time in respect of the Scheme, ech period of twelve months eginning on 1 April CMP Insurnce PCC Limited of PO Box 155, Mill Court, L Chrroterie, St Peter Port, Guernsey GY1 4ET, susidiry of the RICS which is n insurer uthorised y the Guernsey Finncil Services Authority, or such other insurer s the Scheme Administrtor my from time to time select s n pproprite insurer for providing insurnce cover, s required pursunt to Rule 10 memer of the Scheme clim mde pursunt to the Rules of the RICS Client Money Protection Scheme for Property Agents set out in Appendix 2 The Royl Institution of Chrtered Surveyors firm which is registered with RICS for regultion nd which is therefore suject to the RICS Rules of Conduct the RICS rules of conduct s determined y the RICS from time to time nd ny other pplicle mndtory requirements set out y RICS, nd ny other specific nd individul requirements notified to ny prticulr RICS Registered Firm s pproprite Effective from 1 April

9 Client Money Protection "RICS Registrtion Renewl Dte" "Scheme" "Scheme Administrtor" "Scheme Funds" "Scheme Wesite" "TDS Deposit" "UK" in respect of Memer, the dte in ech yer on which its registrtion s n RICS Registered Firm is due for renewl, s notified y RICS the "RICS Client Money Protection Scheme for Surveying Services" the person ppointed to dminister the Scheme in ccordnce with Rule 13 funds held y the Scheme Administrtor in respect of its functions s Scheme Administrtor of the Scheme, including the proceeds of insurnce cover mintined y the Scheme pursunt to Rule 10, ny other funds deriving from Levies received from Scheme Memers nd ny other cover held in respect of the Scheme provided tht this clcultion of Scheme Funds is intended only for the purposes of ssessing the mount of funds ville to meet clims liility for loss of Client Money under Rule 8. It shll in no wy imply ny ring fencing of such funds, which shll otherwise remin Scheme Administrtor's monies for it to pply s it thinks pproprite in ll circumstnces t its discretion the wesite mintined y the Scheme Administrtor in respect of the Scheme t rics.org/clientmoneyprotectionscheme mens:. tenncy deposits protected y TDS from gents nd lndlords who re registered with it s memers of the Insurnce Bsed Tenncy Deposit Protection Scheme (IBTDP) in Englnd nd Wles nd who re lso RICS Memer or Registered Firm ; or. tenncy deposits protected y TDSNI from gents nd lndlords who re registered with it s memers of the Insurnce Bsed Tenncy Deposit Protection Scheme (IBTDP) in Northern Irelnd nd who re lso RICS Memer or Registered Firm. the United Kingdom of Gret Britin nd Northern Irelnd, the Isle of Mn nd the Chnnel Islnds 6 Effective from 1 April 2019

10 rics.org/regultion Scheme purpose nd pprovl 2.1 The min purposes of the Scheme re: to llow RICS Registered Firms to offer client money protection in ccordnce with the Rules; nd to compenste Clients of n RICS Registered Firm for the losses of its Clients resulting from of the RICS Registered Firm filing to ccount for Client Money (s defined in prgrph 1.1) to the person entitled to it in ccordnce with the Rules. 2.2 The Scheme only pplies to Registered Firms with respect to its ctivities in the United Kingdom. 2.3 The Scheme is designed to give some protection to memers of the pulic y mking funds ville for their reimursement when ll other venues hve een exhusted. RICS Registered Firms which re memers of the Scheme cn themselves receive no finncil enefit or protection under the Scheme. In the event of loss, the primry duty is on the defulting RICS Registered Firm to mke full restitution from its own resources (whether y pying the loss out of its own ssets or its own relevnt insurnce cover or otherwise). It is only in cses where the firm concerned is unle to mke full restitution tht the Scheme cn tke effect nd so its Clients my consider whether they cn mke clim under Rule Any questions relting to the terms of the Rules of the Scheme, Scheme Memership nd clims under the Scheme, should e referred to the Scheme Administrtor. Scheme Memership 3. Prticiption y RICS Registered Firms 3.1 Memership of this Scheme forms prt of the pckge of provisions which pply to RICS Registered Firms. 3.2 Ech RICS Registered Firm which holds Client Money must, s prt of its RICS registrtion, ecome Memer of the Scheme. Ech RICS Registered Firm is suject to the generl rules pplicle to RICS Registered Firms nd in ddition, in respect of Client Money (s defined in Rule 1.1), the specific provisions set out in these Rules which form the "RICS Client Money Protection Scheme for ll Surveying Surveys". 4. Durtion of coverge under the Scheme 4.1 Coverge for Memer under the terms of the Scheme shll continue for such time s n RICS Registered Firm remins n RICS Registered Firm nd provided tht Levies invoiced under Rule 5 re pid. 4.2 When seeking to ecome n RICS Registered Firm nd therefter on ech RICS Registrtion Renewl Dte, the Scheme Administrtor shll review the RICS Registered Firm's eligiility to e Memer of the Scheme nd its continued memership of the Scheme. 4.3 The Scheme Administrtor shll review Memer's continued memership of the Scheme on n nnul sis. If, in respect of Memer t its prticulr RICS Registrtion Renewl Dte re registrtion, the RICS intends to terminte its sttus s n RICS Registered Firm, RICS shll notify the Memer ccordingly. 5. Scheme Levies 5.1 Levies re pyle y Memer for the durtion of its Scheme Memership. Effective from 1 April

11 Client Money Protection 5.2 The rte or mount of the Levies in respect of ech Finncil Yer of the Scheme will e pulished on the Scheme's Wesite nd notified to the then current Scheme Memers in good time efore the commencement of the Finncil Yer to which they relte. 5.3 Ech Memer must py the Levy for Scheme Memership of such mount s is determined y the Scheme Administrtor nd notified to the Memer promptly. The mount of the Levy for Memer will e invoiced s prt of the invoice for levies pyle for RICS Registered Firm sttus on ech RICS Registrtion Renewl Dte. The Levy pid s t the RICS Registrtion Renewl Dte is intended to e the Levy for the forthcoming twelve month period fter tht Renewl Dte. It is noted however tht the Finncil Yer of the Scheme will likely differ from the twelve month period which will pply to ech Memer of the Scheme. Should the Scheme Administrtor determine tht the Levies determined pursunt to Rule 5.2 in respect of forthcoming Finncil Yer of the Scheme (or prt of Finncil Yer) re mterilly higher thn were contemplted when Memer's Levy ws invoiced in respect of period which in prt flls in tht Finncil Yer or should the insurnce cover e revised during the course of the Finncil Yer, the Scheme Administrtor my t its discretion issue n dditionl invoice for n dditionl mount of Levy. 5.4 Pyment of ny Levy invoiced must e mde y Memer s precondition for its coverge under the terms of the Scheme remining in full force nd effect for the purposes of Rule Termintion of Memership 6.1 Memership of the Scheme shll e coterminous with the durtion of Memer's registrtion s n RICS Registered Firm. A Memer which fils or is resonly wre tht it my fil to meet ny of the qulifying conditions to e n RICS Registered Firm must notify the Scheme Administrtor promptly. 6.2 Memership of Memer will cese if: the Memer ceses to e n RICS Registered Firm. Deregistrtion s n RICS Registered Firm shll e determined pursunt to the terms of the RICS Rules of Conduct nd will result in cncelltion of the firm's memership of the Scheme with effect from the dte tht the firm is deregistered. the Scheme Administrtor (t its sole discretion) determines, whether t the firm's RICS Registrtion Renewl Dte or otherwise, not to continue Memer's memership of the Scheme. 6.3 Should memership of Memer e terminted, the Scheme Administrtor will cncel the Memer's Memership of the Scheme promptly y notice in writing to the Memer. Cncelltion of memership of the Scheme will men tht protection under the Scheme will cese with effect from the dte tht memership is cncelled. Client money 7. Hndling of Client Money 7.1 Client Money must e held in Client Money Account with nk or uilding society uthorised y the Prudentil Regultory Authority (PRA), the Bnk of Englnd nd the Finncil Conduct Authority (the FCA) in Englnd, Scotlnd, Wles nd Northern Irelnd, or, in the cse of Client Money held in Guernsey, with nk uthorised in Guernsey, the Guernsey Finncil Services Commission or, in the cse of Client Money held in Jersey, with nk uthorised y the Jersey Finncil Services Commission or, in the cse of Client Money held in the Isle of Mn, with nk uthorised y the Isle of Mn Finncil Services Authority 7.2 A Scheme Memer must: mintin one or more Client Money Accounts into which ll Client Money of the Memer is pid; 8 Effective from 1 April 2019

12 rics.org/regultion c d e Client Money Account must e designted s such nd esily distinguished from other ccounts of the Memer; ll clients of the Memer must e dvised tht Client Money will e held in Client Money Account nd e notified of the detils of tht ccount; confirm in writing with the nk with which it holds Client Money Account tht the nk cknowledges tht monies in the Client Money Account must not e comined with, or trnsferred to, ny other ccount mintined y the Memer, nd the nk shll not e entitled to exercise ny right of set up or counterclim ginst money in tht Client Money Account in respect of ny sum owed to it in respect of ny other ccount of the Memer firm; keep records nd ccounts which show ll delings with Client Money, nd demonstrte tht ll Client Money held y the firm is held in Client Money Account. 7.3 As regrds hndling Client Money, Scheme Memer must: c d e f hve nd comply with written procedures for hndling Client Money, which must comply with ny RICS requirement to which Rule 7.4 refers; pulish their procedures for hndling Client Money on their wesite (if ny); provide copy of their procedures for hndling Client Money to ny person who my resonly require copy, free of chrge; keep records nd ccounts tht show ll delings with Client Money; repy ny Client Money, including where fesile ny interest erned, without dely if there is no longer ny requirement to retin tht money or the relevnt client requests it; nd hold nd mintin professionl indemnity insurnce cover tht is pproprite for the Memer's size, income, type of work nd the mount of Client Money held. 7.4 In ddition to the specific provisions set out in Rules 7.1, 7.2 nd 7.3, the Scheme Administrtor my from time to time issue dvice nd guidnce s to how RICS Registered Firms should est comply with RICS Rules of Conduct which my include guidnce to, or prescription of dditionl required procedures for, RICS Registered Firms which re memers of the Scheme relting to key spects of est prctice s to the hndling of Client Money. Compenstion for loss of Client Money 8. Liility for loss of Client Money 8.1 In the event tht Memer fils to ccount for Client Money to person entitled to it whilst remining n RICS Registered Firm (ech Memer hving primry duty to mke full restitution s set out in Rule 2.3), the Scheme Administrtor shll, out of the Scheme Funds, mke good the Memer's liility to tht person or persons s soon s resonly prcticle on the terms set out in Rules The Scheme Administrtor shll, usully on n nnul sis prior to the commencement of ech Finncil Yer of the Scheme: determine the relevnt limits nd risks in respect of which cover is to e provided, further detils of which re explined in Rule 9 elow, nd otin insurnce cover under Rule 10 ccordingly. 8.3 No mount pyle shll e suject to deduction of fee y the Scheme Administrtor nd no Client climnt shll e mde to er ll, or ny prt of ny, excess mount which my e pplicle to the insurnce cover otined under Rule 10. Effective from 1 April

13 Client Money Protection 9. Compenstion Limits 9.1 The Scheme provides for memers of the pulic who re Clients of Memers of the Scheme to e reimursed for ny pecuniry direct loss of Client Money. It does not cover ny indirect or consequentil loss which Client my suffer. 9.2 The Scheme is designed to offer some protection to Clients where ll other venues hve een exhusted, s explined in Rules 2.3 nd 8.1. (Ech Memer hs primry duty to mke full restitution, s set out in Rule 2.3.) Any Client considering mking Clim should in the first instnce, explore ll other venues, principlly y seeking restitution from the defulting Memer, s is resonle in ll the circumstnces. Possile sources of restitution my include finncil indemnity insurnce mintined y the Memer or ccess to other ssets of the Memer. 9.3 The Scheme Administrtor my determine, s it thinks pproprite, ny or ll of the following: limits per clim: cp on liility of the Scheme s whole in respect of ny single Finncil Yer of the Scheme nd/or coverge of, or exclusion of, certin risks. Detils of the current limits, cps nd relevnt risks (the "Compenstion Limits") re set out in the Annex to these Rules s mended y the Scheme Administrtor from time to time. Any ggregte cp set s Compenstion Limit shll e determined y the Scheme Administrtor with the intention tht it shll e in excess of the mximum prole loss which the Scheme Administrtor resonly expects might rise for the Scheme. 9.4 The Scheme Administrtor shll mintin policies nd procedures with view to mitigting the risk of losses for Clients exceeding ny Compenstion Limits it sets pursunt to Rule 9.3. The Scheme Administrtor my impose, whether through the RICS Rules of Conduct or y individul notifiction, controls with view to ensuring tht the prospect of Memer losing Client Money in excess of the Compenstion Limits set y the Scheme Administrtor under Rule 9.3 is sufficiently remote. 9.5 The Compenstion Limits set pursunt to Rule 9.3 shll e reviewed, longside the dequcy of insurnce cover under Rule 10.5, periodiclly s the Scheme Administrtor considers pproprite in ll the circumstnces. They will e reviewed in respect of ech forthcoming Finncil Yer of the Scheme y the Scheme Administrtor prior to the commencement of tht Finncil Yer nd should ny exceptionl circumstnces rise to which Rule 10.5 refers. Should the Scheme Administrtor determine to chnge the limits nd/or risks covered within the Compenstion Limits, the Scheme Administrtor will updte the Annex to these Rules nd Scheme's Wesite promptly nd ny chnges will lso e notified to Scheme Memers promptly so tht, if they wish to review their sttus s n RICS Registered Firm, nd consequently their memership of the Scheme, they will hve the opportunity to do so, nd to mke lterntive rrngements to join nother Property Agents Client Money Protection Scheme. 9.6 In no circumstnces my the individul limit, ggregte limit or risks covered within the Compenstion Limits e mended retrospectively. Any djustments shll only pply with effect from dte on or fter the dte of the djustment s pulished on the Scheme's Wesite nd notified to Scheme Memers. 10. Insurnce cover 10.1 The Scheme Administrtor shll, in respect of ech Finncil Yer of the Scheme, secure insurnce cover with n Insurer tht: covers ny foreseele liility which my rise in connection with filure of Scheme Memers to ccount for Client Money to persons entitled to tht money under Rules 8 nd 9; nd is pproprite with regrd to the size nd numer of Scheme Memers nd the mount of Client Money held y Scheme Memers The insurnce cover otined for Finncil Yer shll e determined y the Scheme Administrtor with the intention tht it shll e sufficient to llow the 10 Effective from 1 April 2019

14 rics.org/regultion Scheme to py out in the cse of mximum prole loss which the Scheme Administrtor might resonly expect might rise in the prticulr Finncil Yer The Scheme Administrtor shll ensure tht the terms for compenstion under Rules 8 nd 9 of the Scheme nd the terms for the insurnce cover otined under this Rule 10 re consistent with ech other. Liility of the Scheme to py Clim only rises in reltion to risk in respect of which such insurnce cover hs een otined Adequcy of insurnce cover shll e monitored periodiclly during ech Finncil Yer s the Scheme Administrtor thinks pproprite in ll the circumstnces. (Should exceptionl circumstnces rise during ny Finncil Yer such tht the Scheme Administrtor resonly considers tht the insurnce cover is, or my ecome, indequte for the purposes set out in Rule 10.1, it my determine to seek chnges to the insurnce cover in respect of the reminder of tht then current Finncil Yer.) 11. Clims procedures 11.1 This Rule sets out the process for mking Clims for compenstion under the Scheme nd the procedures tht will pply in reltion to the investigtion nd determintion of such Clims nd ny complints under the Scheme Clims for compenstion for loss of Client Money shll e mde in ccordnce with such procedures s the Scheme Administrtor my determine nd notify to Scheme Memers from time to time Conditions re kept to the minimum ut two importnt conditions re tht Memer must report ny known or suspected loss to the Scheme Administrtor s soon s possile fter Memer ecomes wre of it. Even if the Memer does not know the full extent or detils of the Client loss, the Memer should dvise the Scheme Administrtor s soon s it ecomes wre of the prolem. where frud or dishonesty is suspected, then the detils must lso e reported to the police nd other relevnt uthorities In respect of Clim or potentil Clim, Memer must: c d e f g Sumit notice in writing of ny potentil clim s soon s prcticle giving ll resonle nd necessry informtion ssistnce nd proof of ny Clim s the Scheme Administrtor my resonly require; gree to cooperte fully with ny investigtion y the Scheme Administrtor or their nominted representtive; gree to onsite visits to the ddresses in which their records nd ccounts showing ll delings with Client Money re held; produce, in response to ll resonle requests y the Scheme Administrtor, ll records nd/or documents relting to mtters pertinent to the Scheme for the Scheme Administrtor nd ny nominted representtive; respond to ll communictions promptly when requested to do so y the Scheme Administrtor; mke every resonle effort to minimise ny Client Money loss nd to tke pproprite mesures immeditely if they re required to reduce ny Clim; nd give the Scheme Administrtor ll resonle ssistnce which my resonly e required to pursue complince with the terms of the Rules Clims will only e ccepted y the Scheme Administrtor in respect of Memer which occurred during such time s the Memer is Memer of the Scheme The Scheme Administrtor shll ccept notifiction of Clims for compenstion under the Scheme for twelve months fter the dte on which the circumstnces giving rise to Clim occurred. Effective from 1 April

15 Client Money Protection 11.7 Any Clims should e sumitted in writing to the Hed of Registrtion nd Complince, RICS Regultion, 55 Colmore Row, Birminghm B3 2AA. The Scheme Administrtor will cknowledge receipt of ny Clim within seven working dys Upon receipt of ll informtion needed to sustntite Clim, the Scheme Administrtor hopes to e le to settle the clim quickly. Clients who re climnts will e kept informed of progress nd dvised of ny resons for ny dely in the process. The Scheme Administrtor will only mke pyment of ny Clim to Client once it hs followed the terms of the clims procedure set out in this Rule nd the Insurer hs pid out to the Scheme Administrtor in respect of tht Clim under the terms of the insurnce cover otined under Rule Upon pyment of ny Clim to Client y the Scheme Administrtor out of the Scheme Funds, the det/loss will e ssigned to the RICS for them to pursue ny recovery ginst the firm or persons responsile. The Scheme Administrtor my require pyment y Memer into the Scheme of n mount dditionl to its Levies which is equl to the detriment suffered y Scheme Funds s result of the Memer's filure to comply with ny conditions in these Rules The Scheme Administrtor shll mintin Clims complints hndling policy which it shll pply in the event of ny complints rising from Clients who mke Clims under the Scheme. Detils of the Clims complints hndling policy shll e mde ville on request to Scheme Memers nd Clients. Generl mtters 12. Durtion of the Scheme 12.1 The Scheme Administrtor shll continue to offer the Scheme for so long s RICS, t its discretion nd for ny reson, decides to do so nd provided tht pproprite insurnce cover cn e otined for the purposes of Rule 10 nd renewed on n nnul sis which mtches the liility for loss of Client Money pursunt to Rules 8 nd The Scheme Administrtor my t its discretion determine to close the Scheme with effect from the Scheme Closure Dte hving given due written notice to Scheme Memers nd hving provided detils of the plns for n orderly closure of the Scheme The Scheme Administrtor my determine to close the Scheme should it fil to otin the type nd mount of insurnce pursunt to Rule 10 in respect of ny prospective renewl of the Scheme's insurnce for the forthcoming Finncil Yer of the Scheme The Scheme Administrtor shll not ccept ny new memer or ny memership renewl once it hs determined to close the Scheme nd, in ny event, on no occsion fter the Scheme Closure Dte. 13. Scheme Administrtor 13.1 The first Scheme Administrtor is RICS itself RICS my determine to ppoint n lterntive Scheme Administrtor, in which event it shll notify Scheme Memers nd updte the Wesite ccordingly. 14. Rule Amendments 14.1 These Rules re the rules in force s t 1 April These Rules replce the terms of ny rules nd other documents in respect of the Scheme issued prior to 1 April 2019 (including The RICS Clients' Money Protection Scheme Firms' Guide nd The RICS Clients' Money Protection Scheme Clients' Guide, ech dted 1 Ferury 2011). 12 Effective from 1 April 2019

16 rics.org/regultion 14.2 The Scheme Administrtor my revise the terms of ny Compenstion Limits s it considers it pproprite on the sis set out in Rule 9.3 nd the dequcy of the insurnce cover on the sis set out in Rule 10.4 s it considers it pproprite from time to time. These provisions will e reviewed y the Scheme Administrtor prior to the commencement of ech Finncil Yer of the Scheme nd should ny exceptionl circumstnces rise during Finncil Yer The Rules my lso e mended s determined y the Scheme Administrtor in ny other respect If nd when the Rules re mended Memers shll e notified promptly efore the Rule chnges come into force nd they shll e mde ville on the Scheme's Wesite. Scheme Memers should ensure tht t ll times they re referring to the most up to dte copy of the Rules of the Scheme. Effective from 1 April

17 Client Money Protection Annex: Compenstion Limits This Annex sets out the current Compenstion Limits for the purposes of Rule Direct loss: Rule 9 mkes it cler tht the Scheme provides for reimursement only in respect of direct loss of client money nd covers no indirect or consequentil loss. In ddition there re specific exclusions s follows. These re determined y the Scheme Administrtor for the purposes of Rule 9.2 nd s set out in this document. 2 Limit per clim: 50,000 3 Cp on liility of the Scheme s whole in respect of ny single Finncil Yer: 10,300,000. This mount is not however exclusively for pyment of clims in respect of Surveying Services Client Money Protection Clims: it lso includes ny mount pyle in respect of TDS Clims (for which there is specific lower mximum limit of 3,000,000) to which Appendix 3 refers nd ny mount pyle in respect of Property Agent Client Money Protection Clims to which Appendix 2 refers. 4 Risks covered / excluded Exclusions from cover re s follows: c d e f g h i Loss of client money tht is jointly held y Client nd Scheme Memer where the Client hs contriuted to such loss. However this exclusion will not pply to innocent Clients. Loss rising or occurring elsewhere thn in the United Kingdom of Gret Britin nd Northern Irelnd, the Chnnel Islnds or the Isle of Mn. Loss of ny consequentil nture including ut not limited to loss of potentil income interest nd dividends not relised y the Client ecuse of loss covered y the Scheme. Penlties, fines or similr impositions. Losses rising due to the filure of ny nk or deposit tker in which Client Money Account is held Loss due to investment, where the investment is specificlly greed in writing with the client Loss of investment income Loss or dmge directly or indirectly occsioned y, hppening through or in the consequence of wr, invsion, cts of foreign enemies, hostilities (whether wr e declred or not), civil wr reellion, revolution, insurrection, militry or usurped power or confisction or ntionlistion or cquisition or destruction of or dmge to property y or under the order of ny government or pulic or locl uthority. Loss, dmge, cost or expense of whtsoever nture directly or indirectly cused y resulting from or in connection with ny ct of terrorism regrdless of ny other cuse or event contriuting concurrently or in ny sequence to the loss. Loss, dmge, costs or expense of whtsoever nture directly or indirectly cused y, or resulting from or in connection with ny ction tken in controlling, preventing, expressing or in ny wy relting to ny ct of terrorism. For this purpose, n "ct of terrorism" mens n ct including ut not limited to the use of force or violence nd/or the thret thereof, or ny person or group(s) of persons, whether cting lone or on ehlf of or in connection with ny orgnistion(s) or government(s) committed for politicl, religious, ideologicl or similr purposes including the intention to influence ny government nd/or put the pulic, or ny section of the pulic, in fer. 14 Effective from 1 April 2019

18 rics.org/regultion Appendix 2: Rules of the RICS Client Money Protection Scheme for Property Agents This Appendix sets out the rules ("the Rules") of the RICS Client Money Protection Scheme for Property Agents ("the Scheme"). These Rules set out the specific provisions which pply in reltion to Client Money held y Property Agents in respect of letting gency work nd property mngement work in Englnd. It therefore concerns client money held in connection with usiness ctivities when cting s residentil letting gents in Englnd. These Rules re dditionl to the RICS Rules of Conduct which pply to n RICS Registered Firm. Tle of Contents Rules of the RICS Client Money Protection Scheme for Property Agents Scheme Memership Client money Compenstion for loss of Client Money Generl mtters Effective from 1 April

19 Client Money Protection Rules of the RICS Client Money Protection Scheme for Property Agents 1. Defined Terms 1.1 In these Rules relting to the RICS Client Money Protection Scheme for Property Agents, the following terms nd expressions shll hve the following menings (unless the context otherwise requires): "the Act" the Housing nd Plnning Act 2016 in respect of Scheme Memer, certificte confirming its memership of "Certificte" the Scheme issued in ccordnce with Rule 4 clim for compenstion y Client of "Clim" Memer under the Scheme in ccordnce with the clims procedures in Rule 11 memer of the pulic which is client of n RICS Registered Firm which is Memer of the Scheme "Client" A memer of the pulic includes ny person, firm, trust, ody corporte or other orgnistion in respect of the Scheme, money "Client Money" "Client Money Account" "Client Money Levies". received y the Memer in the course of English letting gency work within the mening of Section 54 of the Housing nd Plnning Act 2016, or English property gency work within the mening of Section 55 of tht Act; nd. held on ehlf of nother person ut excluding ny money held in ccordnce with n uthorised tenncy deposit scheme within the mening of Chpter IV of Prt 6 of the Housing Act 2004 (see Section 212 of tht Act) in respect of the Scheme, n ccount which:. does not contin ny sums other thn the whole or ny prt of client money pid into it, or such sums of money s my e necessry to replce ny sum which y error hs een withdrwn from the ccount, together with ccrued interest on such mounts; nd. includes in its title the word "client" or n pproprite revition of tht word nd whether such ccount is held in the nme of the Registered Firm or wholly owned susidiry compny of the Registered Firm, or sister compny of the Registered Firm tht holds money in respect of the Registered Firm in respect of the Scheme, levies pid y Memer of the Scheme pursunt to Rule 5 16 Effective from 1 April 2019

20 rics.org/regultion "Closing Dte" "Commencement Dte" "Compenstion Limits" "Finncil Yer" "Insurer" "Memer" or "Scheme Memer" the dte on which the Scheme ceses to provide client money protection for Property Agents in ccordnce with the terms of the Scheme, nd so the dte on which the Scheme is closed in ccordnce with Rule 12 the dte on which the Scheme commences to provide client money protection for Property Agents in ccordnce with the terms of the Scheme the compenstion limits determined y the Scheme Administrtor on the sis set out in Rule 9.3, nd set out in the Annex to these Rules, s mended y the Scheme Administrtor from time to time in respect of the Scheme, ech period of twelve months eginning on 1 April CMP Insurnce PCC Limited of PO Box 155, Mill Court, L Chrroterie, St Peter Port, Guernsey GY1 4ET, susidiry of the RICS which is n insurer uthorised y the Guernsey Finncil Services Authority, or such other insurer s the Scheme Administrtor my from time to time select s n pproprite insurer for providing insurnce cover, s required pursunt to Rule 10 memer of the Scheme Effective from 1 April

21 Client Money Protection in respect of the Scheme. person who engges "in English letting gency work" within the mening of Section 54 of the Act. "Letting gency work" mens things done y person in the course of usiness in response to instructions received from: i. prospective lndlord seeking to find nother person to whom to let housing, or ii. prospective tennt seeking to find housing to rent ut does not include ny of the following things when done y person who does nothing else within the ove descriptions: "Property Agent" pulishing dvertisements or disseminting informtion; providing mens y which prospective lndlord or prospective tennt cn, in response to n dvertisement or dissemintion of informtion, mke direct contct with prospective tennt or prospective lndlord; providing mens y which prospective lndlord nd prospective tennt cn communicte directly with ech other or "English letting gency work mens letting gency work tht reltes to housing in Englnd. person who engges in "English property mngement work" within the mening of Section 55 of the Act. "English property mngement work" mens things done y person in the course of usiness in response to instructions received from the client where i. the client wishes the person to rrnge services, repirs, mintennce, improvements or insurnce in respect of, or to del with ny other spect of the mngement of, premises on the client's ehlf, nd ii. the premises consist of housing in Englnd, let under tenncy. other thn person who engges in tht work in the course of the person's employment under contrct of employment. 18 Effective from 1 April 2019

22 rics.org/regultion "Property Agents Client Money Protection Scheme" "Regultions" "RICS" "RICS Registered Firm" "RICS Rules of Conduct" "RICS Registrtion Renewl Dte" "Scheme" "Scheme Administrtor" "Scheme Funds" "Scheme Wesite" scheme which enles person on whose ehlf Property Agent holds money to e compensted if ll or prt of tht money is not repid in circumstnces in which the scheme pplies, this mening eing given s set out in Section 133(4) of the Act, nd which is pproved y the Secretry of Stte of the Ministry of Housing, Communities nd Locl Government, nd complies with the terms of the Regultions the Client Money Protection Schemes Property Agents (Approvl nd Designtion of Schemes) Regultions 2018 (SI 2018 No. 751) s mended The Royl Institution of Chrtered Surveyors firm which is registered with RICS for regultion nd which is therefore suject to the RICS Rules of Conduct the RICS rules of conduct s determined y the RICS from time to time nd ny other pplicle mndtory requirements set out y RICS, nd ny other specific nd individul requirements notified to ny prticulr RICS Registered Firm s pproprite in respect of Memer, the dte in ech yer on which its registrtion s n RICS Registered Firm is due for renewl, s notified y RICS the "RICS Client Money Protection Scheme for Property Agents" which is pproved s Property Agents Client Money Protection Scheme y the Secretry of Stte of the Ministry of Housing, Communities nd Locl Government for the purposes of the Regultions the person ppointed to dminister the Scheme in ccordnce with Rule 13 funds held y the Scheme Administrtor in respect of its functions s Scheme Administrtor of the Scheme, including the proceeds of insurnce cover mintined y the Scheme pursunt to Rule 10, ny other funds deriving from Levies received from Scheme Memers nd ny other cover held in respect of the Scheme provided tht this clcultion of Scheme Funds is intended only for the purposes of ssessing the mount of funds ville to meet clims liility for loss of Client Money under Rule 8. It shll in no wy imply ny ring fencing of such funds, which shll otherwise remin Scheme Administrtor's monies for it to pply s it thinks pproprite in ll circumstnces t its discretion the wesite mintined y the Scheme Administrtor in respect of the Scheme t rics.org/clientmoneyprotectionscheme Effective from 1 April

23 Client Money Protection 2. Scheme purpose nd pprovl 2.1 The min purposes of the Scheme re: to llow RICS Registered Firms which re Property Agents to offer client money protection in ccordnce with the Rules; nd to compenste Clients of n RICS Registered Firm for the losses of its Clients resulting from of the RICS Registered Firm filing to ccount for Client Money (s defined in prgrph 1.1) to the person entitled to it in ccordnce with the Rules. 2.2 The Scheme only pplies to Registered Firms with respect to their Property Agent ctivities in Englnd. 2.3 The Scheme is designed to give some protection to memers of the pulic y mking funds ville for their reimursement when ll other venues hve een exhusted. RICS Registered Firms which re memers of the Scheme cn themselves receive no finncil enefit or protection under the Scheme. In the event of loss, the primry duty is on the defulting RICS Registered Firm to mke full restitution from its own resources (whether y pying the loss out of its own ssets or its own relevnt insurnce cover or otherwise). It is only in cses where the firm concerned is unle to mke full restitution tht the Scheme cn tke effect nd so its Clients my consider whether they cn mke clim under Rule The Scheme hs een pproved y the Secretry of Stte of the Ministry of Housing, Communities nd Locl Government nd complies with the terms of the Client Money Protection Schemes Property Agents (Approvl nd Designtion of Schemes) Regultions 2018 ("the Regultions"). 2.5 Any questions relting to the terms of the Rules of the Scheme, Scheme Memership nd clims under the Scheme, should e referred to the Scheme Administrtor. Scheme Memership 3. Prticiption y RICS Registered Firms 3.1 Memership of this Scheme forms prt of the pckge of provisions which pply to RICS Registered Firms. 3.2 Ech RICS Registered Firm which is Property Agent which holds Client Money must, s prt of its RICS registrtion, ecome Memer of the Scheme. Ech RICS Registered Firm is suject to the generl rules pplicle to RICS Registered Firms nd in ddition, in respect of Client Money (s defined in Rule 1.1) held s Property Agent, the specific provisions set out in these Rules which form the Property Agents Client Money Protection Scheme offered y RICS. 3.3 When seeking to ecome n RICS Registered Firm nd therefter on ech RICS Registrtion Renewl Dte, the Scheme Administrtor shll review the RICS Registered Firm's eligiility to e Memer of the Scheme nd its continued memership of the Scheme. 4. Issue of Memership Certificte 4.1 Coverge for Memer under the terms of the Scheme shll continue for such time s Certificte continues to e n issue in respect of the Memer. 4.2 A Certificte of Memership shll e issued: in the cse of firm which is n RICS Registered Firm s t the Commencement Dte, s soon s prcticle fter the Commencement Dte; nd 20 Effective from 1 April 2019

24 rics.org/regultion in respect of firm which ecomes registered s n RICS Registered Firm fter the Commencement Dte, s soon s prcticle fter the dte of its registrtion. 4.3 The Scheme Administrtor shll review Memer's continued memership of the Scheme on n nnul sis. If, in respect of Memer t its prticulr RICS Registrtion Renewl Dte, RICS intends to terminte its sttus s n RICS Registered Firm nd/or to rescind its Memer's Memership Certificte, RICS shll notify the Memer ccordingly. Unless otherwise specificlly so notified, the Memership Certificte issued under prgrph 4.2 shll continue in full force nd effect. 4.4 The Certificte of Memership issued to Memer should e displyed y the Memer t ech of the Memer's premises t which the gent dels fce to fce with persons using or proposing to use the Memer's services s Property Agent; nd t plce in ech of those premises where the Certificte is likely to e seen y such persons, In ddition, the Memer will mke ville copy of the Certificte on the Memer's wesite (if ny). The Memer must produce copy of the Certificte to ny person who my resonly request copy of it, free of chrge. 5. Scheme Levies 5.1 Levies re pyle y Memer for the durtion of its Scheme Memership. 5.2 The rte or mount of the Levies in respect of ech Finncil Yer of the Scheme will e pulished on the Scheme's Wesite nd notified to the then current Scheme Memers in good time efore the commencement of the Finncil Yer to which they relte. 5.3 Ech Memer must py the Levy for Scheme Memership of such mount s is determined y the Scheme Administrtor nd notified to the Memer promptly. The mount of the Levy for Memer will e invoiced s prt of the invoice for levies pyle for RICS Registered Firm sttus on ech RICS Registrtion Renewl Dte. The Levy pid s t the RICS Registrtion Renewl Dte is intended to e the Levy for the forthcoming twelve month period fter tht Renewl Dte. It is noted however tht the Finncil Yer of the Scheme will likely differ from the twelve month period which will pply to ech Memer of the Scheme. Should the Scheme Administrtor determine tht the Levies determined pursunt to Rule 5.2 in respect of forthcoming Finncil Yer of the Scheme (or prt of Finncil Yer) re mterilly higher thn were contemplted when Memer's Levy ws invoiced in respect of period which in prt flls in tht Finncil Yer or should the insurnce cover e revised during the course of the Finncil Yer, the Scheme Administrtor my t its discretion issue n dditionl invoice for n dditionl mount of Levy. 5.4 Pyment of ny Levy invoiced must e mde y Memer s precondition for its Certificte remining in full force nd effect for the purposes of Rule Termintion of Memership 6.1 Memership of the Scheme shll e coterminous with the durtion of Memer's registrtion s n RICS Registered Firm nd for so long s it remins Property Agent. A Memer which fils or is resonly wre tht it my fil to meet ny of the qulifying conditions to e n RICS Registered Firm, or ceses to e Property Agent, must notify the Scheme Administrtor promptly. 6.2 Memership of Memer will cese if: the Memer ceses to e n RICS Registered Firm. Deregistrtion s n RICS Registered Firm shll e determined pursunt to the terms of the RICS Rules of Conduct nd will result in cncelltion of the firm's memership of the Scheme with effect from the dte tht the firm is deregistered. Effective from 1 April

25 Client Money Protection the Scheme Administrtor (t its sole discretion) determines, whether t the firm's RICS Registrtion Renewl Dte or otherwise, not to continue Memer's memership of the Scheme. 6.2 Should memership of Memer e terminted, the Scheme Administrtor will cncel the Memer's Certificte promptly y notice in writing to the Memer. Cncelltion of memership of the Scheme will men tht protection under the Scheme will cese with effect from the dte tht memership is cncelled. In the event tht memership is cncelled, former memer must stop using nd/ or remove where displyed ny RICS rnded mteril relting to the Scheme including, ut not limited to, the Certificte of memership. 6.3 In the event of the Scheme's closure pursunt to Rule 12, the Memer must notify its clients promptly nd seek replcement coverge y n lterntive Property Agents Client Money Protection Scheme. Client money 7. Hndling of Client Money 7.1 Client Money must e held in Client Money Account with nk or uilding society uthorised y the Prudentil Regultory Authority (PRA), the Bnk of Englnd nd the Finncil Conduct Authority (the FCA). 7.2 A Scheme Memer must: c d e mintin one or more Client Money Accounts into which ll Client Money of the Memer is pid; Client Money Account must e designted s such nd esily distinguished from other ccounts of the Memer; ll clients of the Memer must e dvised tht Client Money will e held in Client Money Account nd e notified of the detils of tht ccount; confirm in writing with the nk with which it holds Client Money Account tht the nk cknowledges tht monies in the Client Money Account must not e comined with, or trnsferred to, ny other ccount mintined y the Memer, nd the nk shll not e entitled to exercise ny right of set up or counterclim ginst money in tht Client Money Account in respect of ny sum owed to it in respect of ny other ccount of the Memer firm; keep records nd ccounts which show ll delings with Client Money, nd demonstrte tht ll Client Money held y the firm is held in Client Money Account. 7.3 As regrds hndling Client Money, Scheme Memer must: c d e f hve nd comply with written procedures for hndling Client Money, which must comply with ny RICS requirement to which Rule 7.4 refers; pulish their procedures for hndling Client Money on their wesite (if ny); provide copy of their procedures for hndling Client Money to ny person who my resonly require copy, free of chrge; keep records nd ccounts tht show ll delings with Client Money; repy ny Client Money, including where fesile ny interest erned, without dely if there is no longer ny requirement to retin tht money or the relevnt client requests it; nd hold nd mintin professionl indemnity insurnce cover tht is pproprite for the Memer's size, income, type of work nd the mount of Client Money held. 7.4 In ddition to the specific provisions set out in Rules 7.1, 7.2 nd 7.3, the Scheme Administrtor my from time to time issue dvice nd guidnce s to how RICS Registered Firms should est comply with RICS Rules of Conduct, which my include guidnce to, or prescription of dditionl required procedures for, RICS 22 Effective from 1 April 2019

26 rics.org/regultion Registered Firms which re memers of the Scheme relting to key spects of est prctice s to the hndling of Client Money. Compenstion for loss of Client Money 8. Liility for loss of Client Money 8.1 In the event tht Memer fils to ccount for Client Money to person entitled to it whilst remining n RICS Registered Firm (ech Memer hving primry duty to mke full restitution s set out in Rule 2.3), the Scheme Administrtor shll, out of the Scheme Funds, mke good the Memer's liility to tht person or persons s soon s resonly prcticle on the terms set out in Rules The Scheme Administrtor shll, usully on n nnul sis prior to the commencement of ech Finncil Yer of the Scheme: determine the relevnt limits nd risks in respect of which cover is to e provided, further detils of which re explined in Rule 9 elow, nd otin insurnce cover under Rule 10 ccordingly. 8.3 No mount pyle shll e suject to deduction of fee y the Scheme Administrtor nd no Client climnt shll e mde to er ll, or ny prt of ny, excess mount which my e pplicle to the insurnce cover otined under Rule Compenstion Limits 9.1 The Scheme provides for memers of the pulic who re Clients of Memers of the Scheme to e reimursed for ny direct pecuniry loss of Client Money. It does not cover ny indirect or consequentil loss which Client my suffer. 9.2 The Scheme is designed to offer some protection to Clients where ll other venues hve een exhusted, s explined in Rules 2.3 nd 8.1. (Ech Memer hs primry duty to mke full restitution, s set out in Rule 2.3.) Any Client considering mking Clim should in the first instnce, explore ll other venues, principlly y seeking restitution from the defulting Memer, s is resonle in ll the circumstnces. Possile sources of restitution my include finncil indemnity insurnce mintined y the Memer or ccess to other ssets of the Memer. 9.3 The Scheme Administrtor my determine, s it thinks pproprite, ny or ll of the following: limits per clim: cp on liility of the Scheme s whole in respect of ny single Finncil Yer of the Scheme nd/or coverge of, or exclusion of, certin risks. Detils of the current limits, cps nd relevnt risks (the "Compenstion Limits") re set out in the Annex to these Rules s mended y the Scheme Administrtor from time to time. Any ggregte cp set s Compenstion Limit shll e determined y the Scheme Administrtor with the intention tht it shll e in excess of the mximum prole loss which the Scheme Administrtor resonly expects might rise for the Scheme. 9.4 The Scheme Administrtor shll mintin policies nd procedures with view to mitigting the risk of losses for Clients exceeding ny Compenstion Limits it sets pursunt to Rule 9.3. The Scheme Administrtor my impose, whether through the RICS Rules of Conduct or y individul notifiction, controls with view to ensuring tht the prospect of Memer losing Client Money in excess of the Compenstion Limits set y the Scheme Administrtor under Rule 9.3 is sufficiently remote. 9.5 The Compenstion Limits set pursunt to Rule 9.3 shll e reviewed, longside the dequcy of insurnce cover under Rule 10.5, periodiclly s the Scheme Administrtor considers pproprite in ll the circumstnces. They will e reviewed in respect of ech forthcoming Finncil Yer of the Scheme y the Scheme Administrtor prior to the commencement of tht Finncil Yer nd should ny exceptionl circumstnces rise to which Rule 10.5 refers. Should the Scheme Administrtor determine to chnge the limits nd/or risks covered within the Compenstion Limits, the Scheme Administrtor will updte the Annex to these Effective from 1 April

27 Client Money Protection Rules nd Scheme's Wesite promptly nd ny chnges will lso e notified to Scheme Memers promptly so tht, if they wish to review their sttus s n RICS Registered Firm, nd consequently their memership of the Scheme, they will hve the opportunity to do so, nd to mke lterntive rrngements to join nother Property Agents Client Money Protection Scheme. 9.6 In no circumstnces my the individul limit, ggregte limit or risks covered within the Compenstion Limits e mended retrospectively. Any djustments shll only pply with effect from dte on or fter the dte of the djustment s pulished on the Scheme's Wesite nd notified to Scheme Memers. 10. Insurnce cover 10.1 The Scheme Administrtor shll, in respect of ech Finncil Yer of the Scheme, secure insurnce cover with n Insurer tht: covers ny foreseele liility which my rise in connection with filure of Scheme Memers to ccount for Client Money to persons entitled to tht money under Rules 8 nd 9; nd is pproprite with regrd to the size nd numer of Scheme Memers nd the mount of Client Money held y Scheme Memers The insurnce cover otined for Finncil Yer shll e determined y the Scheme Administrtor with the intention tht it shll e sufficient to llow the Scheme to py out in the cse of mximum prole loss which the Scheme Administrtor might resonly expect might rise in the prticulr Finncil Yer The Scheme Administrtor shll ensure tht the terms for compenstion under Rules 8 nd 9 of the Scheme nd the terms for the insurnce cover otined under this Rule 10 re consistent with ech other. Liility of the Scheme to py Clim only rises in reltion to risk in respect of which such insurnce cover hs een otined Insurnce cover must e otined in respect of ech Finncil Yer of the Scheme. The Scheme Administrtor shll use ll resonle endevours to otin the pprovl of the Secretry of Stte s to the type nd mount of insurnce cover otined in respect of ech forthcoming Finncil Yer in respect of the Scheme in good time efore the commencement of tht Finncil Yer Adequcy of insurnce cover shll e monitored periodiclly during ech Finncil Yer s the Scheme Administrtor thinks pproprite in ll the circumstnces. (Should exceptionl circumstnces rise during ny Finncil Yer such tht the Scheme Administrtor resonly considers tht the insurnce cover is, or my ecome, indequte for the purposes set out in Rule 10.1, it my determine to seek chnges to the insurnce cover nd, if so, shll seek the pprovl of the Secretry of Stte s to the revised type nd mount of insurnce cover to e otined in respect of the reminder of tht then current Finncil Yer.) 11. Clims procedures 11.1 This Rule sets out the process for mking Clims for compenstion under the Scheme nd the procedures tht will pply in reltion to the investigtion nd determintion of such Clims nd ny complints under the Scheme Clims for compenstion for loss of Client Money shll e mde in ccordnce with such procedures s the Scheme Administrtor my determine nd notify to Scheme Memers from time to time Conditions re kept to the minimum ut two importnt conditions re tht Memer must report ny known or suspected loss to the Scheme Administrtor s soon s possile fter Memer ecomes wre of it. Even if the Memer does not know the full extent or detils of the Client loss, the Memer should dvise the Scheme Administrtor s soon s it ecomes wre of the prolem. 24 Effective from 1 April 2019

28 rics.org/regultion where frud or dishonesty is suspected, then the detils must lso e reported to the police nd other relevnt uthorities In respect of Clim or potentil Clim, Memer must,: c d e f g Sumit notice in writing of ny potentil Clim s soon s prcticle giving ll resonle nd necessry informtion ssistnce nd proof of ny Clim s the Scheme Administrtor my resonly require; gree to cooperte fully with ny investigtion y the Scheme Administrtor or their nominted representtive; gree to onsite visits to the ddresses in which their records nd ccounts showing ll delings with Client Money re held; produce, in response to ll resonle requests y the Scheme Administrtor, ll records nd/or documents relting to mtters pertinent to the Scheme for the Scheme Administrtor nd ny nominted representtive; respond to ll communictions promptly when requested to do so y the Scheme Administrtor; mke every resonle effort to minimise ny Client Money loss nd to tke pproprite mesures immeditely if they re required to reduce ny Clim; nd give the Scheme Administrtor ll resonle ssistnce which my resonly e required to pursue complince with the terms of the Rules Clims will only e ccepted y the Scheme Administrtor in respect of Memer which occurred during such time s the Memer is Memer of the Scheme The Scheme Administrtor shll ccept notifiction of Clims for compenstion under the Scheme for twelve months fter the dte on which the circumstnces giving rise to Clim occurred Any Clims should e sumitted in writing to the Hed of Registrtion nd Complince, RICS Regultion, 55 Colmore Row, Birminghm B3 2AA. The Scheme Administrtor will cknowledge receipt of ny Clim within seven working dys Upon receipt of ll informtion needed to sustntite Clim, the Scheme Administrtor hopes to e le to settle the clim quickly. Clients who re climnts will e kept informed of progress nd dvised of ny resons for ny dely in the process. The Scheme Administrtor will only mke pyment of ny Clim to Client once it hs followed the terms of the clims procedure set out in this Rule nd the Insurer hs pid out to the Scheme Administrtor in respect of tht Clim under the terms of the insurnce cover otined under Rule Upon pyment of ny Clim to Client y the Scheme Administrtor out of the Scheme Funds, the det/loss will e ssigned to RICS for them to pursue ny recovery ginst the firm or persons responsile. The Scheme Administrtor my require pyment y Memer into the Scheme of n mount dditionl to its Levies which is equl to the detriment suffered y Scheme Funds s result of the Memer's filure to comply with ny conditions in these Rules The Scheme Administrtor shll mintin Clims complints hndling policy which it shll pply in the event of ny complints rising from Clients who mke Clims under the Scheme. Detils of the Clims complints hndling policy shll e mde ville on request to Scheme Memers nd Clients. Generl mtters 12. Durtion of the Scheme 12.1 The Scheme Administrtor shll continue to offer the Scheme for so long s RICS, t its discretion nd for ny reson, decides to do so nd provided tht pproprite insurnce cover cn e otined for the purposes of Rule 10 nd renewed on n nnul sis which mtches the liility for loss of Client Money pursunt to Rules 8 nd 9. Effective from 1 April

29 Client Money Protection 12.2 The Scheme Administrtor my t its discretion determine to close the Scheme with effect from the Scheme Closure Dte hving given due written notice to the Secretry of Stte nd to Scheme Memers nd hving provided detils of the plns for n orderly closure of the Scheme The Scheme Administrtor my determine to close the Scheme should it fil to otin the pprovl of the Secretry of Stte to the type nd mount of insurnce pursunt to Rule 10 in respect of ny prospective renewl of the Scheme's insurnce for the forthcoming Finncil Yer of the Scheme The Scheme my lso e required to e closed should the Secretry of Stte withdrw the pprovl of the Scheme pursunt to Regultion 9 of the Regultions In the event of the Scheme's closure pursunt to the ove revisions of this Rule 12, the Scheme Administrtor: c will, in devising its plns for closure of the Scheme, hve due regrd to the need to enle n orderly trnsfer of Scheme Memers to n lterntive Property Agents Client Money Protection Scheme efore the Scheme Closure Dte. (Determintion of the Scheme Closure Dte shll hve due regrd to such need to enle the orderly trnsfer of Scheme Memers.) give written notice to ech Scheme Memer of the fct of closure; the resons why the Scheme is eing closed; nd the Scheme Closure Dte; in the written notice to which prgrph () refers, set out procedures which re designed to fcilitte the smooth trnsfer of the Scheme's Memers to n lterntive designted or pproved Client Money Scheme which shll e intended to e t no dditionl cost to scheme memers efore the Scheme Closure Dte The Scheme Administrtor shll not ccept ny new memer or ny memership renewl once it hs determined to close the Scheme nd, in ny event, on no occsion fter the Scheme Closure Dte. 13 Scheme Administrtor 13.1 As required y the Regultions, the Scheme Administrtor shll e independent from the Scheme Memers, offering protections such tht: the Scheme shll not e suject to interference from Memers nd Memers will not e le to influence the pyment of ny clims; nd the decision mking process for the ppointment of the Scheme Administrtor shll e tken y RICS in ccordnce with its own procedures nd therefore not suject to the risk of influence of ny Memers which re suject to potentil Clim or investigtion The first Scheme Administrtor is RICS itself RICS my determine to ppoint n lterntive Scheme Administrtor, in which event it shll notify Scheme Memers nd updte the Wesite ccordingly. 14 Rule Amendments 14.1 These Rules re the rules in force s t 1 April The Scheme Administrtor my revise the terms of ny Compenstion Limits s it considers it pproprite on the sis set out in Rule 9.3 nd the dequcy of the insurnce cover on the sis set out in Rule 10.5 s it considers it pproprite from time to time. These provisions will e reviewed y the Scheme Administrtor prior to the commencement of ech Finncil Yer of the Scheme nd should ny exceptionl circumstnces rise during Finncil Yer The Rules my lso e mended s determined y the Scheme Administrtor in ny other respect, suject to such mendments not prejudicing pprovl of the Scheme s Property Agents' Client Money Protection Scheme y the Secretry of Stte. 26 Effective from 1 April 2019

30 rics.org/regultion 14.4 If nd when the Rules re mended Memers shll e notified promptly efore the Rule chnges come into force nd they shll e mde ville on the Scheme's Wesite. Scheme Memers should ensure tht t ll times they re referring to the most up to dte copy of the Rules of the Scheme. Effective from 1 April

31 Client Money Protection Annex: Compenstion Limits This Annex sets out the current Compenstion Limits for the purposes of Rule Direct loss: Rule 9 mkes it cler tht the Scheme provides for reimursement only in respect of direct loss of client money nd covers no indirect or consequentil loss. In ddition there re specific exclusions s follows. These re determined y the Scheme Administrtor for the purposes of Rule 9.2 nd s set out in this document. 2 Limit per clim: 50,000 3 Cp on liility of the Scheme s whole in respect of ny single Finncil Yer: The Totl Aggregte Limit ville to py Clims is 30,300,000. The initil mount of 10,300,000 is lso ville to meet ny Surveying Services Client Money Protection Clims pyle under the Appendix 1 Scheme nd ny TDS Clims to which Appendix 3 refers. This initil mount of 10,300,000 cn e utilised for ny of the three types of cover. The dditionl sum of 20,000,000 is only ville for Property Agent Client Money Protection Clims. 4 Risks covered / excluded Exclusions from cover re s follows: c d e f g h i Loss of client money tht is jointly held y Client nd Scheme Memer where the Client hs contriuted to such loss. However this exclusion will not pply to innocent Clients. Loss rising or occurring elsewhere thn in the United Kingdom of Gret Britin nd Northern Irelnd, the Chnnel Islnds or the Isle of Mn. Loss of ny consequentil nture including ut not limited to loss of potentil income interest nd dividends not relised y the Client ecuse of loss covered y the Scheme. Penlties, fines or similr impositions. Losses rising due to the filure of ny nk or deposit tker in which Client Money Account is held Loss due to investment, where the investment is specificlly greed in writing with the client Loss of investment income Loss or dmge directly or indirectly occsioned y, hppening through or in the consequence of wr, invsion, cts of foreign enemies, hostilities (whether wr e declred or not), civil wr reellion, revolution, insurrection, militry or usurped power or confisction or ntionlistion or cquisition or destruction of or dmge to property y or under the order of ny government or pulic or locl uthority. Loss, dmge, cost or expense of whtsoever nture directly or indirectly cused y resulting from or in connection with ny ct of terrorism regrdless of ny other cuse or event contriuting concurrently or in ny sequence to the loss. Loss, dmge, costs or expense of whtsoever nture directly or indirectly cused y, or resulting from or in connection with ny ction tken in controlling, preventing, expressing or in ny wy relting to ny ct of terrorism. For this purpose, n "ct of terrorism" mens n ct including ut not limited to the use of force or violence nd/or the thret thereof, or ny person or group(s) of persons, whether cting lone or on ehlf of or in connection with ny 28 Effective from 1 April 2019

32 rics.org/regultion orgnistion(s) or government(s), committed for politicl, religious, ideologicl or similr purposes including the intention to influence ny government nd/or put the pulic, or ny section of the pulic, in fer. Effective from 1 April

33 Client Money Protection Appendix 3: TDS Deposits The Dispute Service Limited (TDS) hs een ppointed y the Secretry of Stte for Communities nd Locl Government under the provisions of Schedule 10 of the Housing Act 2004 to collect nd hold Tenncy Deposits from gents nd lndlords who re registered with it s memers of the Insurnce Bsed Tenncy Deposit Protection Scheme (IBTDP) in Englnd nd Wles nd to distriute such deposits in ccordnce with ny djudiction mde y TDS or y the Courts or y ny other ody ppointed y TDS to djudicte in such cses. TDS hs wholly owned susidiry Tenncy Deposit Scheme Northern Irelnd Limited (TDSNI) which hs een ppointed y Ministers in the Deprtment of Socil Development in Northern Irelnd under The Tenncy Deposit Schemes Regultions (Northern Irelnd) 2012 to operte oth custodil tenncy deposit protection scheme nd n IBTDP Scheme in Northern Irelnd. TDSNI is ppointed to collect nd hold disputed tenncy deposits from gents nd lndlords who re registered with it s memers of the IBTDP Scheme in Northern Irelnd nd to distriute such deposits in ccordnce with ny djudiction mde y TDSNI or y the Courts or y ny other ody ppointed y TDSNI to djudicte in such cses. RICS hs greed with TDS tht Clims y TDS or TDSNI, or their ppointed insurer representtives, mde ginst RICS Memers nd RICS Registered Firms will e pid in ccordnce with n insurnce policy tken out y RICS, up to n ggregte limit of 3,000,000 in respect of ny Finncil Yer eing ech period of twelve months eginning on 1 April. RICS hs mde such n pproprite insurnce rrngement with CMP Insurnce PCC Limited, susidiry of RICS which is n insurer uthorised y the Guernsey Finncil Services Authority. It should e noted tht the greement etween RICS nd TDS for RICS to meet Clims up to n ggregte limit of 3,000,000 in ny one Finncil Yer is limited to clims for protected tenncy deposit monies mde ginst RICS Memers nd RICS Registered Firms y TDS or TDSNI nd shll not e tken to include ny ssocited legl costs or dvisory costs, dmges or interest incurred y TDS or TDSNI or their ppointed insurer representtives. For ny mount over 3,000,000, the clim mount remins with TDS or TDSNI, s pproprite. RICS my from time to time issue guidnce or dditionl required procedures for RICS Registered Firms which re memers of TDS or TDSNI relting to the ove mtters if it thinks it pproprite. 30 Effective from 1 April 2019