Phase 2 Regulations - Updated Code of Ethics Regulation - Trust in Real Estate Services Act, 2020
O. Reg. 580/05
Regulation - Minister
Bill or Act:
Real Estate and Business Brokers Act, 2002
Summary of Proposal:
On March 4, 2020, the Trust in Real Estate Services Act, 2020 (TRESA, 2020) received Royal Assent. TRESA, 2020 amends the Real Estate and Business Brokers Act, 2002 (REBBA), the legislation that governs real estate brokerages, brokers and salespersons (registrants) in Ontario. REBBA and its regulations are administered and enforced by the Real Estate Council of Ontario (RECO).
The Ministry of Government and Consumer Services (the ministry) is continuing the process of consulting on the regulations required to bring these legislative changes into force. In the first phase of this process, regulations were made to allow salespersons and brokers to incorporate and be paid through a personal real estate corporation and to allow salespersons and brokers to use more recognizable terms, such as "agent" and "REALTOR®" in advertisements.
The second phase of regulation development (Phase 2) is currently underway. During this phase, the ministry is developing regulatory proposals to:
A. Update the Code of Ethics regulation (the Code) under REBBA;
B. Transfer procedural and technical requirements from the Code to other regulations;
C. Enhance disclosure requirements and other registrant obligations to better protect consumers of real estate services and increase consumer choice;
D. Update RECO's regulatory powers and tools, including revising the procedures of RECO's discipline committee.
This posting on Ontario's Regulatory Registry is for purposes of consulting on a proposed updated Code.
The current Code can be confusing for both real estate registrants and the general public because it mixes ethical requirements (e.g., fairness and honesty) with technical and procedural requirements (e.g., details that must be included in written agreements).
The ministry is proposing changes that would streamline registrant obligations to enhance professionalism and consumer protection. The draft updated Code that is the subject of this consultation, retains and revises the ethical requirements that are set out in the current Code, while the technical and procedural requirements would be moved to the General Regulation or other regulations under REBBA. The proposed updated Code is principle-based, articulating requirements that registrants must comply with in relation to matters such as integrity, quality of service and conflicts of interest.
The work necessary to update and transfer the technical and procedural requirements in the current Code will follow at a later date and there will be an opportunity for the public and other stakeholders to provide input at that point.
The ministry welcomes your feedback on the draft updated Code and encourages anyone who is interested to provide comments on this proposal. You may submit your comments by responding directly to the Regulatory Registry posting or by sending an email with your feedback to firstname.lastname@example.org. Comments are due no later than July 2, 2021.
When this consultation period closes, the feedback from the consultation will be reviewed and analyzed. Where appropriate, revisions to the proposed updated Code will be considered.
Drafts of the remaining Phase 2 regulations are expected to be posted for consultation on the Regulatory Registry in late summer 2021.
All Phase 2 regulations including the updated Code, if approved, would come into force at the same time. The ministry is proposing all Phase 2 regulations would come into force on January 1, 2022.
Analysis of Regulatory Impact:
This posting on Ontario's Regulatory Registry is for purposes of consulting on a proposed updated Code of Ethics regulation. Consultations on the remaining Phase 2 proposed regulation changes - including changes to other regulations that result directly from updates to the Code - are expected to follow starting in late summer.
Impact on business, including direct compliance costs and administrative costs for an updated Code of Ethics regulation, can only be evaluated once the other components of the Phase 2 regulations are developed.
June 1, 2021
Comments Due Date:
July 2, 2021
REBBA/TRESA Regulatory Consultation
Policy, Planning and Oversight Division
Ministry of Government and Consumer Services
56 Wellesley St. W., 6th Floor
Toronto, ON M7A 1C1