Regulation - Minister

Improvements to Ontario's New Home Warranty and Protection Program (Phase 2: New Home Construction Licensing Act, 2017)

Regulation Number(s):
O. Reg. 626/20: GENERAL
Instrument Type:
Regulation - Minister
Bill or Act:
New Home Construction Licensing Act, 2017
Summary of Decision:
The Ontario government has taken further steps to strengthen consumer protection for buyers and owners of new homes in Ontario. The changes will require the Registrar of the Home Construction Regulatory Authority (HCRA) to post additional information to the public registry (Ontario Builder Directory), namely:
1. Conditions on a licence to which an applicant or licensee consents.
2. Conditions on a licence that the registrar applies.
3. Conditions on a licence that the Licence Appeal Tribunal orders.

To do this, the government has amended the General regulation under the New Home Construction Licensing Act, 2017 (NHCLA). The amendment to the General regulation took effect on April 1, 2021.

In addition, the government brought into force section 57 of NHCLA through an Order-in-Council. Section 57 of the NHCLA provides for a discipline committee to hear and determine if a licensee has failed to comply with a code of ethics established by a Minister's regulation, as well as an appeals committee to consider appeals from the discipline committee.
The government also introduced a new Minister's regulation under the NHCLA that establishes a code of ethics and provides details about the composition and procedures of the discipline and appeals committees.

The new Code of Ethics and Discipline and Appeals Committees regulation under the NHCLA came into effect on July 1, 2021.

Collectively, the second phase for the NHCLA will enhance consumer protections by:

• requiring the HCRA to post additional information publicly on the Ontario Builder Directory so that consumers are able to make better-informed decisions when selecting a new home builder or vendor for purchases of new homes; and
• requiring licensees to abide by ethical standards, which would be enforceable through a formalized complaints process, and a robust disciplinary and appeals process.
Analysis of Regulatory Impact:
No new direct compliance costs were created for businesses or consumers related to the regulation amendments under the New Home Construction Licensing Act, 2017 (NHCLA) and did not create any new burdens.

The amendment to the General regulation made under the NHCLA requires the registrar of the HCRA to post information about conditions on licences to the Ontario Builder Directory which will increase transparency to consumers. The amendment allows consumers to make more well-informed decisions when making one of the biggest purchases in their lives - a new home.
Further Information:
Proposal Number:
Posting Date:
December 15, 2020
Summary of Proposal:
The government is taking steps to establish a separate regulator for new home builders and vendors through the separation of Tarion's warranties and protections administration and its builder and vendor regulation functions. Effective February 1, 2021, the Home Construction Regulatory Authority (HCRA) will be designated as the regulatory authority under the New Home Construction Licensing Act, 2017 (NHCLA). The HCRA will administer the delegated provisions of NHCLA, including the licensing and regulation of new home builders and vendors. Once the HCRA is designated, Tarion will cease to provide the functions transferred to the HCRA, subject to potential exceptions during transition. Tarion will continue to administer new home warranties and protections under the Ontario New Home Warranties Plan Act. This is part of Ontario's commitment to overhaul the Ontario new home warranty and protection program to make it more consumer-focused and to enhance the current single administrator model for warranties and protections delivery.

The proposed regulation, if passed, would establish a code of ethics, a discipline committee and an appeals committee - a framework that would address complaints to better protect consumers and hold licensees accountable for their action. The proposed regulatory changes are expected to take effect on July 1, 2021.

1. Code of Ethics

Some of the requirements in the proposed Code of Ethics could include:

• Treating people honestly and with integrity
• Not engaging in discrimination, harassment or bullying
• Providing reasonable accommodations to those with disabilities
• Ensuring the health and safety of people is protected
• Providing courteous and responsive service while demonstrating knowledge, skill, judgment and competence
• Not engaging in or being a party to misrepresentation
• Ensuring the use of all forms and documents as required by law
• Complying with the laws in every jurisdiction in which the licensee carries on business
• Being truthful and clear in descriptions of features, benefits and prices connected with a new home

2. Discipline Committee

The proposed regulation would include the following matters in relation to the discipline committee:

• Composition of the Committee
• Procedure of Discipline Committee

3. Appeals Committee

The proposed regulation would include the following matters in relation to the appeals committee:

• Composition of the Committee
• Commencement of Appeals

The ministry is also proposing an amendment to the general regulation to improve the information published in the Ontario Builder Directory. The proposed regulatory change is expected to take effect on the date of filing.

The ministry welcomes your feedback and encourages anyone interested to provide comments on this proposal. You may submit your comments to the Regulatory Registry.
Contact Address:
Ministry of Government and Consumer Services, 56 Wellesley St. W., 6th Floor, Toronto ON, M7A 1C1
Effective Date:
April 1, 2021