What will be different about the New code?
Service Charges in Commercial Property, 4th edition – RICS will be a Professional Statement.
RICS members must comply with professional statements in order to remain professionally competent. When an allegation of negligence is made against a surveyor, the court is likely to take into account any relevant professional statements published by RICS in deciding whether or not the surveyor acted reasonably.
The new Service Charges in Commercial Property, 4th edition – RICS is aimed at improving standards, promoting best practice, uniformity, fairness and transparency in the management and administration of service charges in commercial property.
It is likely to include mandatory
1) Annual issuing of budgets and reconciliations with appropriate explanatory notes.
2) Provision of an apportionment matrix annually to all tenants.
3) Requirement for all service charge monies (including reserve and sinking funds) to be held in separate or (or virtual) bank accounts.
4) Requirement for a signed statement of actual expenditure provided annually.
There will also be additional guidance on transparency and disclosure, sinking, reserve funds, handovers and guidance on dealing with service charge queries and disputes.
Get in touch if you have any questions about the new code and how it affects you.