Article 20 of the Saudi Accredited Valuers Law

This article deals with conflict of interest in valuation.

First rule: the duty of disclosure

The accredited valuer must disclose any interest they have in what they are asked to value, whether it is:

• a direct interest, or
• an indirect interest.

The article does not specify to whom the disclosure is made or its form.

Second rule: cases of not accepting the work

The Implementing Regulations determine the cases in which the valuer must not accept the work. Disclosure is therefore not enough in every case; there are cases in which the valuation must be declined altogether, and identifying them is left to the Regulations.

The purpose: under Article 1, valuation is the process of determining fair value, and fair value requires impartiality. If the valuer has an interest in the thing valued, their estimate may be affected.

Practical effect:

• If a valuer is asked to value a property in which they have an interest, they must disclose it.
• To know whether the case requires declining the work, the Implementing Regulations must be consulted.

Relationship to other articles: Article 19 makes the valuer responsible for compensating harm to the client or third parties caused by their errors in performing their work. Article 21 requires a valuer who stops practicing the profession to notify the Ministry, the Authority and the client within 30 days of stopping.

Anyone who doubts the impartiality of a valuer who prepared a valuation concerning them can consult a lawyer who specializes in commercial or real estate cases.