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CIS 12.3 Property schemes

Standing independent valuer

CIS 12.3.1R
  1. (1)

    An authorised fund manager of a property scheme must ensure that any immovables in the scheme property are valued by an appropriate valuer (standing independent valuer) appointed by the authorised fund manager. The appointment must be made with the approval of the trustee or depositary at the outset and upon any vacancy.

  2. (2)

    The valuer in (1) must be:

    1. (a)

      for an AUT, independent of the manager and trustee; and

    2. (b)

      for an ICVC, independent of the ICVC, the directors and the depositary.

Functions of the standing independent valuer

CIS 12.3.2R
  1. (1)

    The authorised fund manager must ensure that the standing independent valuer appointed under CIS 12.3.1 R values all the immovables held within the scheme property, on the basis of a full valuation with physical inspection (including, where the immovable is or includes a building, internal inspection) at least once a year.

  2. (2)

    The authorised fund manager must ensure that the standing independent valuer values the immovables, on the basis of a review of the last full valuation, at least once a month.

  3. (3)

    If either the authorised fund manager or the depositary become aware of any matter appear likely to:

    1. (a)

      affect the outcome of a valuation of an immovable; or

    2. (b)

      cause the valuer to decide to value under (1) instead of under (2),

    the one of them becoming aware must immediately inform the standing independent valuer of that matter.

  4. (4)

    The authorised fund manager must use its best endeavours to ensure that any affected person reports to the standing independent valuer immediately upon that person becoming aware of any matter within (3).

  5. (5)

    Any valuation by the standing independent valuer must be on the basis of an "Open Market value" as defined in Practice Statement 4 in the Royal Institute of Chartered Surveyors' Appraisal and Valuation Manual (first edition published September 1995) but subject to CIS 4.8.3 R (3)(Valuation: requirements).

Special rules for pricing

CIS 12.3.3R
  1. (1)

    Any valuation under CIS 12.3.2 R has effect, until the next valuation under that rule, for the purposes of the value of immovables under CIS 4 and CIS 15.

  2. (2)

    An agreement to transfer an immovable or an interest in an immovable is to be disregarded for the purpose of the valuation of the scheme property unless it appears to the authorised fund manager to be legally enforceable.

  3. (3)

    The rules in CIS 12.3.5 R do not apply to property schemes.

Failure to obtain minimum subscriptions

CIS 12.3.4R
  1. (1)

    Where it appears to the authorised fund manager that the aggregate of monies paid or agreed to be paid for units to be issued or sold is less than £5m (or the equivalent in the base currency), the authorised fund manager must use its best endeavours to enable the scheme to be wound up under CIS 14 or by the court.

  2. (2)

    Paragraph (1) must be complied with either:

    1. (a)

      immediately upon the expiry of any initial offer; or

    2. (b)

      where there is no initial offer, within 21 days after the date on which persons are first invited to become holders in the scheme.

  3. (3)

    In so far as is practicable, the authorised fund manager must pay back to a holder any preliminary or other charge by way of remuneration which it received in respect of units issued up to the end of the period in (2)(a) or (b).

CIS 12.3.5R

Rules which do not apply to property schemes

This table belongs to CIS 12.3.3 R

Single-priced ICVC or AUT

Dual-priced AUT





Item 10 Table 15.8R para 10 - Valuation

Note: Item 10 is disapplied in relation to immovables.