The Independent System Operator and Planner Transfer Scheme Compensation Regulations 2024

Procedure for valuer compensation determination and valuation party representations

8.—(1) In making a compensation determination the valuer must—

(a) except as otherwise specified in the valuation documents, make the compensation determination in relation to the target business only;

(b) make a compensation determination on a market value (MV) basis, as defined in paragraph 30.1 and construed in accordance with paragraph 30 (IVS-Defined Basis of Value – Market Value) of the International Valuation Standards as published on 31st July 2021 and effective from 31st January 2022(1).

(2) In making a compensation determination the valuer must have regard to—

(a) any representations regarding the details of the compensation in the valuation documents made in writing by a valuation party to the valuer, provided that such representations are made within the period of 10 working days beginning with the later of—

(i) the day on which the valuer notifies the valuation parties under paragraph (3); or

(ii) the day after that on which the conditions in regulation 3 are satisfied such that there is an absence of agreement regarding compensation for the purpose of paragraph 8(2)(b) of Schedule 9;

(b) any representations made in writing by a valuation party in response to representations made by the other valuation party under sub-paragraph (a), provided that such representations are made within the period of 10 working days beginning with the day after that on which the relevant representations under sub-paragraph (a) are made.

(3) The valuer must provide written notice to the valuation parties on the day that the valuer commences work on the compensation determination, informing them of the same.

(4) The valuation parties may by written agreement vary the time limits—

(a) to make representations to the valuer in accordance with paragraph (2)(a); and

(b) to respond to representations made by the other valuation party in accordance with paragraph (2)(b).

(5) The compensation determination may—

(a) determine the compensation as at a reference date set out in the valuation documents;

(b) contain a statement of assumptions made by the valuer in making the compensation determination;

(c) where the valuation documents contain an adjustment mechanism by which the compensation as at the reference date may be adjusted by reference to the transfer date, contain recommendations for modifications to that mechanism to give effect to the assumptions referred to in sub-paragraph (b) and the compensation determination.

(6) The valuer must use reasonable endeavours to provide a compensation determination as soon as practicable after being appointed.

(7) Each valuation party must cooperate with the valuer to enable the valuer to provide a compensation determination as soon as practicable after being appointed.

(8) Before providing a compensation determination, the valuer must provide a draft compensation determination to each valuation party.

(9) Each valuation party may make representations in writing to the valuer with respect to the draft compensation determination within the period of 10 working days beginning on the day after that on which the draft was provided.

(10) The valuer must consider such representations and may make revisions before providing the compensation determination.

(11) When providing a compensation determination, the valuer must include a report detailing how the valuer has arrived at the compensation determination, and any documentation and material (other than referred to in these Regulations) to which the valuer had regard in making the compensation determination.

(12) If either valuation party is of the opinion that there has been a manifest error in the compensation determination, it must within the period of 10 working days beginning on the day after that of the valuer providing the compensation determination, notify the valuer and the other valuation party, setting out a full explanation of the alleged manifest error.

(13) The valuer must consider such notification and as soon as practicable determine whether the compensation determination may require revision having regard to the matters raised.

(14) If the valuer considers that revision may be necessary, the valuer must provide a draft of the revision to the valuation parties and grant the valuation parties the opportunity to respond in writing within a period of 5 working days beginning on the day after that on which the draft revision is provided, before re-issuing the compensation determination, which may include revisions.

(1)

Available online at https://www.rics.org/content/dam/ricsglobal/documents/standards/ivsc_effective_31_jan_2022.pdf, starting at page 22. For information on how to obtain a hard copy, contact [e-mail].