                                 CODE OF VIRGINIA

LICENSE REQUIRED; CERTIFICATION OF EMPLOYEES; RENEWAL; PROVISIONAL LICENSE (§
54.1-2346)

A. Unless exempted by &#xA7; 54.1-2347, any person, partnership, corporation, or
other entity offering management services to a common interest community on or
after January 1, 2009, shall hold a valid license issued in accordance with the
provisions of this article prior to engaging in such management services.

B. Unless exempted by &#xA7; 54.1-2347, any person, partnership, corporation, or
other entity offering management services to a common interest community without
being licensed in accordance with the provisions of this article shall be
subject to the provisions of &#xA7; 54.1-111.

C. On or after July 1, 2012, it shall be a condition of the issuance or renewal
of the license of a common interest community manager that all employees of the
common interest community manager who have principal responsibility for
management services provided to a common interest community or who have
supervisory responsibility for employees who participate directly in the
provision of management services to a common interest community shall, within
two years after employment with the common interest community manager, hold a
certificate issued by the Board certifying the person possesses the character
and minimum skills to engage properly in the provision of management services to
a common interest community or shall be under the direct supervision of a
certified employee of such common interest community manager. A common interest
community manager shall notify the Board if a certificated employee is
discharged or in any way terminates his active status with the common interest
community manager.

D. It shall be a condition of the issuance or renewal of the license of a common
interest community manager that the common interest community manager shall
obtain and maintain a blanket fidelity bond or employee dishonesty insurance
policy insuring the common interest community manager against losses resulting
from theft or dishonesty committed by the officers, directors, and persons
employed by the common interest community manager. Such bond or insurance policy
shall include coverage for losses of clients of the common interest community
manager resulting from theft or dishonesty committed by the officers, directors,
and persons employed by the common interest community manager. Such bond or
insurance policy shall provide coverage in an amount equal to the lesser of $2
million or the highest aggregate amount of the operating and reserve balances of
all associations under the control of the common interest community manager
during the prior fiscal year. The minimum coverage amount shall be $10,000.

E. It shall be a condition of the issuance or renewal of the license of a common
interest community manager that the common interest community manager certifies
to the Board (i) that the common interest community manager is in good standing
and authorized to transact business in Virginia; (ii) that the common interest
community manager has established a code of conduct for the officers, directors,
and persons employed by the common interest community manager to protect against
conflicts of interest; (iii) that the common interest community manager provides
all management services pursuant to written contracts with the associations to
which such services are provided; (iv) that the common interest community
manager has established a system of internal accounting controls to manage the
risk of fraud or illegal acts; and (v) that an independent certified public
accountant reviews or audits the financial statements of the common interest
community manager at least annually in accordance with standards established by
the American Institute of Certified Public Accountants or by any successor
standard-setting authorities.

HISTORY: 2008, cc. 851, 871; 2011, cc. 334, 605; 2019, c. 712.