Act
Amendments to the New Home Construction Licensing Act, 2017 to protect purchasers of new homes
Regulation Number(s):
N/A
Instrument Type:
Act
Bill or Act:
New Home Construction Licensing Act, 2017
Summary of Proposal:
Bill 23, the More Homes Built Faster Act, 2022 was passed by the Legislature and received Royal Assent on November 28, 2022. We have extended the deadline of this posting to enable your feedback to continue to be submitted so that it can help inform the implementation of this proposal as well as future initiatives. You may also want to consider submitting comments on other related postings and/or providing your comments directly to the Ministry at newhomes@ontario.ca.
The Ministry of Public and Business Service Delivery (ministry) is proposing amendments to the New Home Construction Licensing Act, 2017 (Licensing Act) to address unethical behaviour by vendors and strengthen consumer protection for purchasers of new homes in Ontario who may be adversely impacted by price escalations and terminations of agreements.
The proposed amendments include:
1) Increasing the maximum allowable amount for an Administrative Monetary Penalty (AMP) under the Licensing Act from $25,000 to $50,000;
2) Increasing the maximum fines that a court may impose after a person or entity has previously been convicted of an offence - specifically, a maximum fine of $100,000 for a subsequent conviction in the case of an individual, and a maximum fine of $500,000 for a subsequent conviction in the case of a person or entity that is not an individual.
3) Allowing for AMPs to be imposed retroactively to contraventions that occurred on or after April 14, 2022;
4) Enabling the Home Construction Regulatory Authority (HCRA) to use the proceeds of AMPs and fines to provide funds to adversely impacted consumers and make a related regulation requiring the HCRA to establish, maintain and comply with a policy to this effect;
5) Specifying that making payments to adversely affected consumers is one of the purposes for which the HCRA may use the funds it collects as AMPs and fines under the Code of Ethics;
6) Clarifying that provisions of the Code of Ethics may be prescribed for the purposes of AMPs;
7) Clarifying that the purpose of the AMP is to ensure compliance with legislation and licensing requirements as well as to prevent a person from deriving an economic benefit as a result of violating a provision of the legislation or conditions of a license;
8) Clarifying that AMPs may be imposed to ensure compliance with the Acts, regulations, conditions of a license and by-laws referred to in s. 76(1);
9) Clarifying the two-year limitation period for AMPs to ensure that an AMP cannot be imposed more than two years after the day any assessor became aware of the contravention;
10) Replacing the terms 'Minister's Regulation' with 'Minister's Order' in order to align the board governance provisions with other ministry statutes; and
11) Ensuring that the language in section 24 of the Code of Ethics aligns with language in section 56.1 of the Licensing Act to achieve consistency;
12) Making other necessary amendments to provide further clarity under Part III of the Licensing Act.
The ministry's proposed legislative amendments to the Licensing Act will help ensure consumers are better protected when making one of the biggest purchases of their lives - a new home.
The ministry welcomes your feedback and encourages anyone interested to provide comments on this proposal.
The Ministry of Public and Business Service Delivery (ministry) is proposing amendments to the New Home Construction Licensing Act, 2017 (Licensing Act) to address unethical behaviour by vendors and strengthen consumer protection for purchasers of new homes in Ontario who may be adversely impacted by price escalations and terminations of agreements.
The proposed amendments include:
1) Increasing the maximum allowable amount for an Administrative Monetary Penalty (AMP) under the Licensing Act from $25,000 to $50,000;
2) Increasing the maximum fines that a court may impose after a person or entity has previously been convicted of an offence - specifically, a maximum fine of $100,000 for a subsequent conviction in the case of an individual, and a maximum fine of $500,000 for a subsequent conviction in the case of a person or entity that is not an individual.
3) Allowing for AMPs to be imposed retroactively to contraventions that occurred on or after April 14, 2022;
4) Enabling the Home Construction Regulatory Authority (HCRA) to use the proceeds of AMPs and fines to provide funds to adversely impacted consumers and make a related regulation requiring the HCRA to establish, maintain and comply with a policy to this effect;
5) Specifying that making payments to adversely affected consumers is one of the purposes for which the HCRA may use the funds it collects as AMPs and fines under the Code of Ethics;
6) Clarifying that provisions of the Code of Ethics may be prescribed for the purposes of AMPs;
7) Clarifying that the purpose of the AMP is to ensure compliance with legislation and licensing requirements as well as to prevent a person from deriving an economic benefit as a result of violating a provision of the legislation or conditions of a license;
8) Clarifying that AMPs may be imposed to ensure compliance with the Acts, regulations, conditions of a license and by-laws referred to in s. 76(1);
9) Clarifying the two-year limitation period for AMPs to ensure that an AMP cannot be imposed more than two years after the day any assessor became aware of the contravention;
10) Replacing the terms 'Minister's Regulation' with 'Minister's Order' in order to align the board governance provisions with other ministry statutes; and
11) Ensuring that the language in section 24 of the Code of Ethics aligns with language in section 56.1 of the Licensing Act to achieve consistency;
12) Making other necessary amendments to provide further clarity under Part III of the Licensing Act.
The ministry's proposed legislative amendments to the Licensing Act will help ensure consumers are better protected when making one of the biggest purchases of their lives - a new home.
The ministry welcomes your feedback and encourages anyone interested to provide comments on this proposal.
Analysis of Regulatory Impact:
The proposed legislative amendments are not expected to create a burden on the new home construction sector as builders and vendors should be adhering to the requirements and rules currently set out under the Licensing Act and its regulations. The proposed amendments are intended to deter future conduct issues and to give the HCRA the tools to increase compliance and better protect consumers.
There are no costs or cost savings to small businesses associated with the Ministry's proposed amendments.
The proposal is not expected to create any fiscal impacts for government since implementation would be carried out by the HCRA, an administrative authority that is financially and operationally independent from the government. The administrative authority model is expected to be cost neutral to the government.
The administrative authority's operating costs are funded from the sector through licensing and other fees
There are no costs or cost savings to small businesses associated with the Ministry's proposed amendments.
The proposal is not expected to create any fiscal impacts for government since implementation would be carried out by the HCRA, an administrative authority that is financially and operationally independent from the government. The administrative authority model is expected to be cost neutral to the government.
The administrative authority's operating costs are funded from the sector through licensing and other fees
Further Information:
New Home Construction Licensing Act, 2017
Proposal Number:
22-MGCS021
Posting Date:
October 25, 2022
Comments Due Date:
December 9, 2022
Contact Address:
Ministry of Public and Business Service Delivery, 56 Wellesley St. W., 6th Floor, Toronto ON, M7A 1C1