Ethics, Rules of Conduct and Professionalism Flashcards

1
Q

Types of standards?

A

Professional statements - These contain ‘musts’ – our mandatory requirements, along with details of regulatory interventions if these requirements are not met.

Guidance notes - These contain ‘shoulds’ – non-mandatory requirements, but recommendations of best practice on undertaking given tasks.

Assessment of Professional Competence (APC) - These are the requirements and guidelines relating to entry into the profession.

Data standards - These ensure software programmes and technology can adopt RICS standards into their offering.

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2
Q

CPD rules

A

Members must undertake a minimum of 20 hours of CPD activity each calendar year, Of the 20 hours at least 10 hours must be formal CPD.

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3
Q

The role of professional groups

A

Professional groups are the way that RICS segments the various technical specialisms of the profession. In total there are 18 groups covering the broad spectrum of surveying services.

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4
Q

Professional bodies within RICS

A

Lionheart
Matrix
Property elite

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5
Q

RICS Policy Documents

A

RICS guidance notes set out good practice for RICS members and for firms that are regulated by RICS. An RICS guidance note is a professional or personal standard for the purposes of RICS Rules of Conduct. Guidance notes constitute areas of professional, behavioural competence and/or good practice.

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6
Q

RICS bye-laws

A

The Bye Laws specify the situations in which reports must be made to RICS, including for certain breaches of RICS rules and regulations as well as following charge or conviction for certain criminal offences.

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7
Q

Why do we have professional standards?

A

To ensure a high standard of work is delivered.

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8
Q

What does PII stand for?

A

Professional Indemnity insurance

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9
Q

What is the process for handling client money?

A

When client money is received, RICS-regulated firms must ensure that:
It is paid into a client money account promptly
If mixed monies are received, they must be paid into a client money account and then office money transferred out promptly
Account for interest or other benefits, unless agreed in writing with the client
Unidentified funds are promptly identified. If the owner is not identified within 3 years then they must be paid to a registered charity

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10
Q

What is the meaning of the RICS Motto?

A

The motto is ‘Est Modus in Rebus’ which in Latin translates to There is measure in all things’.

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11
Q

What is the Mission Statement of the RICS?

A

To qualify and equip their members to offer the highest standards of professional service.
To promote and enforce standards
To lead solutions to the major challenges facing the built environment through professional expertise.

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12
Q

When was the RICS founded?

A

It was founded in 1868.

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13
Q

How is the RICS Structured?

A

The RICS was founded in 1868 with the Royal Charter being granted by the Privy Council in1881.
The RICS is self-regulated and internally monitored meaning that it is not regulated by the Government or external parties.
The Bye-Laws determine how the RICS is regulated.
The Governing council manage and agree the strategy for the RICS.
The Regulatory board, audit committee and management board are beneath the governing council and execute the strategy set by them.

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14
Q

What are the RICS’ 5 principles of better regulation?

A

Proportionality.
Accountability.
Consistency.
Targeting.
Transparency.

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15
Q

What is the difference between RICS ethics and rules?

A

Ethics are a set of moral values.
Rules of conduct are a framework that we work to.

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16
Q

How many Global Professional and Ethical standards are there?

A

Up until the 1st February 2022 there were 5 Global Professional & Ethical Standards.
From the 2nd February 2022 onwards the Global Professional & Ethical Standards have been consolidated within the New Rules of Conduct 2022.

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17
Q

What are the Global Professional & Ethical Standards?

A

Act with integrity.
Always provide a high standard of service.
Act in a way that promotes trust in the profession.
Treat others with respect.
Take responsibility.

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18
Q

What are the New Rules of Conduct?

A

Rule 1. Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
Rule 2. Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.
Rule 3. Members and firms must provide good-quality and diligent service.
Rule 4. Members and firms must treat others with respect and encourage diversity and inclusion.
Rule 5. Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession.

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19
Q

Why did the previous Rules of Conduct change?

A

The previous rules had been in place since 2007.
* Following research and consultation with RICS Members, Firms and Members of the public, the majority voted in favour of replacing the existing Rules of Conduct and separate Global Professional and Ethical Standards.
This was to provide a single document to enable greater clarity for RICS members and firms.

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20
Q

What are the professional obligations of members?

A
  1. Members must comply with the CPD requirements set by the RICS which requires 20 hours of CPD for each calendar year, 10 hours of which must be formal CPD.
  2. Members must cooperate with RICS.
  3. Members must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.
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21
Q

What are the professional obligations of firms?

A
  1. Firms must publish a complaints-handling procedure, which includes an alternative dispute resolution provider approved by RICS, and maintain a complaints log.
  2. Firms must ensure that all previous and current professional work is covered by adequate and appropriate professional indemnity cover that meets the standards approved by RICS.
  3. Firms with a sole principal must make appropriate arrangements for their professional work to continue in the event of their incapacity, death, absence from or inability to work.
  4. Firms must cooperate with RICS.
  5. Firms must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.
  6. Firms must display on their business literature, in accordance with RICS’ published policy on designations, a designation to denote that they are regulated by RICS.
  7. Firms must report to RICS any matter that they are required to report under the Rules for the Registration of Firms.
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22
Q

Why does the RICS have Rules of Conduct?

A

To provide a framework that we can all work to and so the client knows he is getting a set level of service.

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23
Q

In the case of a breach of a rule of conduct what is the procedure?

A

Not every shortcoming will necessarily give rise to proceedings.
A formal investigation by the Head of Regulation of the RICS is the first step
The RICS can request information and/or visit and inspect to investigate compliance. Members must cooperate fully with all enquiries.

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24
Q

How can a disciplinary proceeding be triggered?

A

Someone complaining to the RICS.
An allegation by a client or third party.
Information received or established by the RICS.

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25
Q

What three actions can be imposed after the end of the investigation stage?
.

A

Fixed penalty.
Consent order.
Disciplinary panel

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26
Q

What are fixed penalties?

A

A fine by the RICS.

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27
Q

What are consent orders?

A

It is a written agreement between the RICS and a member or firm concerning a disciplinary issue on a breach of the RICS rules.
It can require the member to take certain corrective actions, or restrain them from taking certain actions for a specified period of time and may require them to pay a fine or costs.

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28
Q

When is a disciplinary panel applicable?

A

They are used for more serious breaches of conduct.
The panel will usually be held in public.
The burden of proof is on the RICS.
A balance of probabilities approach will be adopted.

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29
Q

What sort of breaches would expulsion be suitable for?

A

Gross, persistent or willful failure to comply with an RICS rule of conduct.
Fraud, dishonesty, conviction of a serious criminal offence, gross incompetence, deliberate discrimination, misappropriation of a client’s money.

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30
Q

What procedures must you follow if you are starting up a new practice?

A

Contact the RICS for guidance and obtain a company start up pack.
Inform the RICS and register for regulation.
Appoint a contact officer for all RICS communication.
Prepare a complaints handling procedure.
Obtain Professional indemnity insurance cover.
Abide by the Rules of Conduct for Firms.
Use the designation Regulated by RICS’ on all practice material.

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31
Q

What insurances would you need if you were starting up your own firm?

A

Professional Indemnity Insurance.
Employer’s Liability.
Public Liability.
* Building’s insurance of an office premises.

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32
Q

What sort of information do registered firms have to send to the RICS annually?

A

It is called annual return and carried out on-line.
Failure to do so leads to a fixed penalty.
It includes:-
o Type of business and staffing.
о Nature of clients.
o Training provision.
o Complaints handling procedures details and records.
о PI insurance details.
Whether the firm holds clients’ money

33
Q

What processes do regulated firms need to put in place when handling Clients’ Money?

A

Preserve the security of clients’ money which does not belong wholly to the company.
RICS regulated firms that operate a client account must:-
O Set clear segregation of duties for employees.
o A Principal oversees the client money accounting functions.
o Principles cannot override controls.
o Competent and knowledgeable staff are to process clients’ money with cover provided for long
term absence.
o Accounting systems and data must be secure.
о Client money must be kept separate and clearly identifiable with the word ‘client’ included in the bank account name.
Clients must always have access to funds.
We must agree the terms and advise the client on bank details.
The account must not be overdrawn.
We must maintain client ledgers and provide a running balance.

34
Q

What are the different types of client money accounts?

A

General accounts hold money for more than one client.
Discrete accounts reference a single named client.

35
Q

What is meant by the term Negligence?

A

A duty of care is owed to all clients and 3rd parties using reasonable skill and care.
If it is breached due to Negligence a claim may arise resulting in damages being paid or a Professional Indemnity Insurance claim.
Negligence is a failure to provide the duty of care that is owed to the client.

36
Q

Tell us about the Merrit V Babb case law?

A

This case dates back to 2001 and highlights the importance of having run-off cover in place.
A surveyor was sued for negligence by a former client.
Because the surveying firm was no longer in existence therefore the individual surveyor was pursued for damages successfully.
This caused a big shock in the industry and highlighted the need to ensure that run-off cover is in place for all previous employees.

37
Q

What limitation periods are associated with underhand and deed forms of contract?

A

6 years when executed under hand. 12 years when executed as a deed

38
Q

What must a complaints handling procedure include?

A

The RICS provides a model form.
The process must include a redress mechanism.
Details of the policy should be issued to the client with the Terms of Business.
It must be clear, quick, transparent and impartial and free of charge within the first stage. Names and contact details of the nominated investigating person must be stated.
The complaint must be investigated within 28 days.
All complaints, their progress and outcomes must be recorded.
We must note the need to advise PI insurers of a complaint immediately.
The process must have two stages as a minimum:-
Stage 1 is where there needs to be consideration of the complaint by a senior member of the firm or the complaints handling officer.
o Stage 2 if the issue is not resolved, the complaint is referred to an independent third party with the authority to award redress. The complainant may be expected to contribute towards costs at this stage.

39
Q

What is an independent redress scheme?

A

It is a consumer scheme designed to handle small issues that would be disproportionally expensive to take to court.
If the scheme judges in favour of the complainant, it is binding.
If it judges in favour of the firm, the complainant can escalate the matter to court.
RICS firms must specify which redress scheme they want to use, it could be an ombudsman, arbitration or sometimes adjudication.
If the complaint relates to a large amount of money or if the complainant wishes so, he can take the matter to court.

40
Q

What do you do if you receive a letter of complaint?

A

I would acknowledge receipt and I would forward it to my firms designated complaint handler, as per our complaint handling procedure, providing additional information as required.
I would also highlight the importance of informing our Professional Indemnity insurance providers immediately.

41
Q

What is the ‘Clients’ Money Protection Scheme’?

A

This is a money protection scheme operated by the RICS.
It contains provision for any member of the public to be reimbursed their direct loss of funds when using an RICS regulated firm.
This is provided through an RICS insurance policy.

42
Q

What is the purpose of the joint names on a client account?

A

For the purpose of dual authorisation.

43
Q

What are the continuous professional development (CPD) requirements?

A

Members must undertake and record appropriate lifelong learning.
On request by the RICS they must provide evidence that they have carried out the CPD to maintain and improve their levels of professional competence.

44
Q

How do you keep up to date with topical issues?

A

I am on the mailing list for several CPD providers.
My employer’s research & development team send us weekly digests of the relevant press and I request copies of articles of interest.
I also exchange industry articles and relevant information with colleagues.
I follow updates on the RICS website and Construction Journals
I undertake regular web research on key topics relevant to my field of surveying.

45
Q

What is your CPD strategy

A

I meet with my manager twice a year to review my career development plan and objectives.
I build my CPD strategy around these objectives, current topics and personal interests. The candidate should try to explain their own personal objectives to address this question.

46
Q

What is the purpose of Professional Indemnity Insurance?

A

To provide financial cover in the event a client suffers financial loss as a result of a breach of professional duty e.g. neglect, errors or omissions.

47
Q

What benefits does PII provide for the professional?

A

The professional is protected from financial losses.
The firm does not have to meet the claim from their own assets and resources.

48
Q

What benefits does PII provide for the client?

A
  • They are able to recover their financial losses.
49
Q

What are the requirements regarding Professional Indemnity Insurance set by the RICS?

A

The policy cover must be made on an ‘each and every’ claim basis.
The RICS sets out the minimum levels of indemnity.
The RICS sets out the maximum levels of uninsured excess.
Run off cover must be in place for at least 6 years.
The policy should include cover for past and present employees, directors and partners.

50
Q

What measures should be taken to try and avoid PI claims?

A

Keep full and detailed records of meetings and conversations.
Record recommendations and advice given.
Use proper letters of engagement, scope of services and terms of engagement.
Don’t advise on a specialism outside your field of experience.
Use RICS guidelines.
Avoid poor management and excessive workloads.

51
Q

If you made a mistake in your cost plan what would your insurance company expect?

A

For you to notify them and comply with any conditions & procedures set out in the insurance policy.

52
Q

If an estimate prepared by a QS is incorrect can the client claim damages?

A

An estimate that is incorrect in itself will not provide the client with a right of redress.
The client must demonstrate that the QS warranted the accuracy of the estimate or that it was incorrect due to a lack of reasonable skill and care.
It could have been incorrect due to reasons outside their control for example market conditions or an item referred to in their exclusions.

53
Q

How can you limit your liability when agreeing terms of appointment with a client?

A

Base the appointment on reasonable care and skill rather than fitness for purpose which is more
onerous.
If the client’s requirements are performance based, this may imply fitness for purpose. It is advisable to request a clause limiting the appointment to reasonable skill and care only.
Run off cover must be in place.
Execution of the appointment under hand will result in a reduced liability period of 6 years instead of 12.

54
Q

What are the main elements included within a fee proposal?

A

Scope of services.
Exclusions.
Assumptions.
Terms and conditions.

55
Q

If you put together a fee proposal, but a couple of months into the job you realise that you have under forecasted your resources, would you go back to the client and ask for more money?

A

If project requirements such as the services, scope or value of the project has increased then I would go back to client and request a fee increase.
If the scope of works had remained the same, this highlights a mistake within our fee bid and the additional work would need to be carried out without reducing the level of service being offered and without requesting additional fees from the client.

56
Q

Once you and your client agreed the services that are to be provided verbally what would you do next?

A

Follow up with a formal letter which includes the terms and conditions, fees and scope of services that are to be provided.

57
Q

If the client gives you a lump sum fee before going on holiday, what would you do?

A

I would place the funds in a separately identified client account and agree a drawdown of monies against the services being provided with the client.

58
Q

Tell me what you understand about conflicts of interest?

A

A conflict of interest is where someone in a position of trust has competing personal or professional interests making it difficult for them to fulfil their duties impartially.
An existing relationship will result in reduced impartiality and Chartered Surveyors have an obligation to make clients aware of this and if necessary, decline work opportunities where a conflict of interest occurs.

59
Q

How could the conflict of interest be managed internally if two separate departments were working for the same client?

A

I could put in place procedures to ensure exclusivity of staff.
This would avoid any cross over of information between the departments.
I would also ensure that there are separate communication lines into the client.
Separate geographical locations and secure office and data storage would also need to be provided. Staff could also sign up to confidentiality or non-disclosure agreements.
I would also need to monitor the potential conflict and keep the client updated on progress.

60
Q

If the client was insistent that you worked for them despite an existing conflict of interest, how would you proceed?

A

I would check the clients understanding around the conflict of interest.
I would then make the client aware of the potential for reduced impartiality.
If they were still insistent on the appointment, I would seek a letter of instruction from the client to continue.
Following the appointment I would agree working procedures to manage the conflict of interest with the client and the teams involved.

61
Q

What are the Main Principles of the Bribery Act?

A

The offences are:-
o Making a bribe.
。 Receiving a bribe.
o Bribery of a foreign public official.
Failure of a corporate entity to prevent bribery on its behalf.
The legislation applies to all UK Entities and includes associated Persons for example sub-consultants and external advisors.
There are six principles of prevention companies should put in place:-
O 1. Proportionate Procedures.
2. Top Level Commitment.
о 3. Risk Assessments.
о 4. Due Diligence.
5. Communication.
6. Monitoring & Review.

62
Q

Under the Bribery Act, under what circumstance is a facilitation payment permitted?

A

The only circumstance in which it is OK to make a facilitation payment is when you are under duress. For example if there is a real and present risk or danger to “life, limb or liberty”.
If you or your companions are under immediate physical threat.
You should put safety first, make the payment and report the matter immediately. Or as soon as is practicable to your manager or your ethics compliance contact.

63
Q

You are attending a Main Contractor organised business conference where it is announced the you have been randomly selected as the winner of this months prize draw. Its an i-pad air. How would you act in this scenario?

A

I would be extremely uncomfortable accepting the prize in this scenario.
The prize is of a significant value and could be interpreted as a bribe.
Furthermore due to working on a project with the Main Contractor at the time of this scenario, accepting the prize would have been highly inappropriate and could be interpreted as having an affect on my business conduct during the project.
I would respectfully decline the prize and suggest that this is made as a charitable donation to a charity of the Main Contractor’s choice.
I am aware that bribes are commonly distributed as random prizes and due to the seriousness of this incident I would report this to my line manager.

64
Q

You receive an invite to attend the Theatre with some members of your Project Team but they dropped out due to illness at the last minute, would you still attend?

A

In the first instance I would declare this hospitality on my companies’ gifts and hospitality register. Assuming the invite was approved and I was authorised to attend, I would need to decline the invite due to the Project Team dropping out.
Since they won’t be present, this will not be a genuine business event.
Consequently, I would decline this hospitality at the Project Team’s expense.

65
Q

A contractor invites you to lunch to a restaurant and advises they’ve got two Michelin stars and a wine list second to none. They say they are keen to discuss the details of their tender they are about to submit for the project you are working on. How would you respond?

A

Going to what sounds like a lavish lunch paid for by a bidder in the middle of a tender process is against Company policy and could be an offence under the UK Bribery Act.
If this were the first time, it would be OK just to decline and explain that such an invitation is inappropriate.
However if this supplier is persistent, there is a red flag in that he wants to discuss things that he cannot put in writing, so we should report this infringement.

66
Q

what are the rules for conflicts of interest

A

An RICS member or regulated firm must not advise or represent a client where doing so would involve a Conflict of Interest or a significant risk of a Conflict of Interest; other than where all of those who are or may be affected have provided their prior Informed Consent.

67
Q

when is informed consent applicable for conflicts of interest?

A

Informed Consent may be sought only where the RICS member or regulated
firm is satisfied that proceeding despite a Conflict of Interest is:

a in the interests of all of those who are or may be affected and
b is not prohibited by law,

and that the conflict will not prevent the member or regulated firm from providing
competent and diligent advice to those that may be affected.

68
Q

Do RICS members have to maintain confidentiality?

A

RICS members and regulated firms must maintain confidentiality of Confidential
Information unless disclosure is required or permitted by law, or the RICS member or
regulated firm concerned can demonstrate that the relevant party consented to the
disclosure before it was made.

69
Q

what is a conflict of interest?

A

a situation in which the duty of an RICS member (working independently or within a
non-regulated firm or within a regulated firm) or a regulated firm to act in the interests of a client or other party in a professional assignment conflicts with a duty owed to another client or party in relation to the same or a related professional assignment (a Party Conflict’)

70
Q

How could the conflict of interest be managed internally if two
separate departments were working for the same client?

A
  • Ensure exclusivity of staff to each department
  • Separate communication lines into the client
  • Separate geographical locations / secure
    office and data storage
  • Sign up to confidentiality / non disclosure
    agreements
  • Monitor the potential conflict and keep the
    client updated
71
Q

If the client was insistent that you worked for them despite an
existing conflict of interest, how would you proceed?

A
  • Check the clients understanding around the conflict of interest
  • Make them aware of the potential for reduced impartiality
  • Seek a letter of instruction from the client to continue
  • Talk through working procedures to manage the conflict of interest
  • Agree this formally in writing with the client
72
Q

Q4) What are the minimum levels of indemnity? / How do you determine
the level of PI cover?

A
  • This depends on the firm’s turnover
  • If turnover is £100k or less it is £250k
  • If turnover is £100 - £200k it is £500k
  • If turnover is above £200k it is £1m
73
Q

What are the maximum levels of uninsured excess?

A

Depends on the level of indemnity
* Up to £500k = greater of 2.5% of insured sum or £10,000
* Over £500k = 2.5% of the insured sum

74
Q

What are the Main Principles
of the Bribery Act?

A

A) Offences:
* Making a bribe
* Receiving a bribe
* Bribery of a foreign public official
* Applies to all UK Entities
* Includes Associated Persons
* Six Principles of Prevention – 1. Proportionate Procedures 2. Top Level Commitment. 3. Risk
Assessments. 4 Due Diligence. 5 Communication. 6 Monitoring & Review.

75
Q

Under the Bribery Act, under what
circumstance is a facilitation payment permitted?

A
  • The only circumstance in which it is OK to make a facilitation payment is when you are under
    duress
  • ie there is a real and present risk or danger to “life, limb or liberty”.
  • If you or your companions are under immediate physical threat
  • You should put safety first, make the payment and report the matter immediately,
  • Or as soon as is practicable to your manager or your Ethics/Compliance/Legal contact.
76
Q

You are bidding for a project and the client advises that if you
reduce your fee bid by £3,000 you will be first place and win the tender,
how would you advise the client?

A
  • Unfair competition
  • Not treating others with respect
  • Not acting with integrity
  • Unsustainable to undertake business in this manner
  • Avoid Dutch auctions as devaluing the profession
  • You would need to reduce scope to achieve same margin, would this provide high standard of service
  • This could be interpreted as a bribe
77
Q

The partner says you have spent all the fees on the job, the final
accounts are still to be agreed and some areas are still to be re-
measured according to the contractor, what should you do?

A
  • I do not lower my level of services.
  • I investigate why all the fees have been spent.
  • If it is an error in our fee calculation, I put in place measures to ensure that it does not happen
    again.
  • If it is because we have provided additional services I give all the details to my director to prepare a
    claim for additional fees.
  • I ensure that I keep track of fee spending and of all works not included in our scope of services.
78
Q

What is GDPR?

A
  • The EU General Data Protection Regulation (GDPR) replaces the Data Protection Directive
    95/46/EC and was designed to harmonize data privacy laws across Europe.
  • To protect and empower all EU citizens data privacy and to reshape the way organisations
    across the region approach data privacy.
  • Like its predecessor, the GDPR is designed to protect personally identifiable information
    (personal data)
79
Q

who is the RICS president and Vice president

A

Ann Gray (2023) Vice - Justin Sullivan (2023)