Compulsory Purchase in Focus: Key Changes in the Updated RICS Professional Standard

In light of the government’s infrastructure strategy and housing delivery plans and the rise in the use of CPO powers, the RICS has updated its Professional Standard on Surveyors Advising in Respect of Compulsory Purchase and Statutory Compensation.

Taking effect from December 2024, this revision introduces several key changes aimed at enhancing professional conduct, competence and clarity in the application of compulsory purchase and the negotiation of statutory compensation. We explore the main amendments and their implications for Surveyors.

Structural and Organisational Changes

The Professional Standard sets out 21 mandatory professional behaviour and competence expectations of RICS members, along with the introduction of new sections: Valuation and Red Book Global Standards (Section 6), Claims and Negotiations (Section 8) and Complaints (Section 12), which are examined below. A glossary is also included to clarify several key terms.

Expanded Guidance on Valuation and the Red Book (Section 6)

This section places a stronger emphasis on the application of the Red Book whilst also providing clearer guidance when using exceptions. These exceptions must be explicitly stated and explained in the valuation report as per PS 1 5.7.

Enhanced Standards for Claims and Negotiations (Section 8)

There is expanded guidance on claims and negotiations, providing insights into:

Access to information: Surveyors must ensure clients are aware of key resources, such as government guidance and the Compulsory Purchase Association’s Land Compensation Claims Protocol. Surveyors must also advise clients of the application of the Professional Standard and provide a copy on request.

Negotiations prior to compulsory purchase: This highlights details around voluntary agreements over reliance on compulsory powers. To that end, there must be a clear distinction between shadow negotiations and negotiations for statutory compensation following the exercise of CPO powers.

Statutory compensation claims: Clearer guidelines have been introduced for submitting, quantifying, and supporting compensation claims with detailed evidence.

New Section on Complaints (Section 12)

The standard introduces a dedicated complaints section outlining different types of complaints, including those from clients, opposing parties and clients against the opposing party. This section also distinguishes between disputes over compensation and conduct-related complaints, advising on appropriate courses of action for each scenario.

There are further notable changes to existing sections, which are highlighted below.

Revised Approach to Professional Fees

There is expanded guidance on what constitutes reasonable professional fees, with a new appendix outlining work that may justifiably be included, but this is not exhaustive, nor will all the items listed apply to every case.

Strengthened Requirements for AML Compliance

Surveyors are obliged to conduct anti-money laundering checks on clients. Not only does this ensure compliance with legal and regulatory standards, but it reinforces surveyors’ ethical responsibility when dealing with clients.

Emphasis on Alternative Dispute Resolution

Section 11 encourages Surveyors to consider ADR before resorting to litigation. This aligns with government recommendations and aims to streamline dispute resolution, reducing costs and delays.

Conclusion

The 2024 updates to this Professional Standard reflect the evolving nature of CPO and land assembly more generally. With these updates, Surveyors must ensure they fully understand and integrate them into their work.

This is part five of a five-part series named “Compulsory Purchase in Focus”. Read the full series HERE.