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“We have joined RICS’s regulatory regime because we believe the time has come to establish formal regulation within the international art auction industry,” he said. “We believe RICS to be the best-placed body to become auction-industry regulator, a responsibility it has already fulfilled to wide acclaim within the real estate world.”

Bonhams set up separate trust accounts for clients’ money three years ago and, having now formalised and reinforced this position, the firm are challenging others to do to the same.

“In particular, we believe that the issues surrounding the treatment of clients’ funds should be most urgently addressed. In light of recent financial and banking turmoil, this must surely be a priority,” Brooks added.

He has been outspoken in the past on the dangers of auctioneers moving away from their traditional role as the simple intermediary between buyer and seller. In renewing his crusade, he also clearly sees commercial advantages in differentiating Bonhams from their rivals.

“Bonhams are currently unique among the major international auctioneers in having a system which guarantees the safety of clients’ money – by keeping it ring-fenced and entirely separate from company cashflow. This is particularly pertinent these days when some companies are heavily engaged in both providing price guarantees for sellers and long-term credit for buyers,” he said.

Though he said it was important for large firms to take a lead, he was quick to point out that Bonhams were not the first firm to be RICS regulated and applauded the many provincial firms already operating within the new RICS rules.

He said that Bonhams had been in discussions with RICS for some time and that he was now more than satisfied that the institution was well informed about the auction industry and equipped to fulfil the regulatory role.

The RICS operates in 146 countries and has around 86,000 chartered members worldwide, with the emphasis on property rather than chattels. Only around 2000 are auctioneers and valuers in the Arts and Antiques Faculty.

The Institution set up a separate regulatory board in June 2007 as a semi-independent body at arm’s length from the interests of RICS members. It is chaired by a non-member, Teresa Graham CBE, who said: “I welcome any commitment to enhance standards in markets and I compliment Bonhams on their desire to raise international standards by becoming part of RICS’ regulatory regime.“

All firms where 50 per cent or more of the directors or partners are RICS members are automatically deemed to be regulated and must abide by the Institution’s rules of conduct. Firms where RICS members are in the minority on the board can voluntarily elect to become regulated as Bonhams have done.

As well as ensuring the safety of all money held on behalf of clients, regulated firms must have professional indemnity cover, set up internal and independent external client complaints procedures and show a commitment to professional and technical standards and training.

While pressing for greater self-regulation, Robert Brooks stressed that he was not calling for any new legislation.

“I am certainly not asking the Government to step in. God forbid that we should get into that situation. The legal framework for regulation already exists and RICS can have an important role in the process,” he said.

Commenting on Bonhams’ announcement, British Art Market Federation chairman Anthony Browne said it was up to individuals to decide whether they wanted adopt the RICS system, but he added: “The market is currently subject to extensive legislation in a number of areas.”

He pointed to a list of almost 100 laws directly affecting the domestic art market, drawn up by specialist lawyer Pierre Valentin of Withers when BAMF gave evidence over the introduction of the London Act early last year.

By Mark Bridge