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Competition Bureau vs. TREB


If you’ve been living in a cave for the last three years (specifically one on the moon……..with your eyes closed and your hands over your ears), then perhaps you don’t know what today’s blog topic refers to.

But for everybody else out there in Pleasantville, you’ve been following this story with great interest.

The case basically boils down to “sold data,” which is not made publicly available by the Toronto Real Estate Board, and the Competition Bureau believes it should be.

This case has been going on for years, through multiple courts and appeals, but finally ended last Thursday.

This is from the Government of Canada website:

“Today’s ruling is a decisive victory for competition, innovation and for consumers. By removing TREB’s anti-competitive restrictions, home buyers and sellers in the GTA will now have greater access to information and innovative real estate services when making one of the most significant financial decisions of their lives.”

Matthew Boswell
Interim Commissioner of Competition

  • The Bureau’s case against TREB had been ongoing since 2011, when the Commissioner filed an application with the Competition Tribunal challenging the restrictions that TREB imposed on its members’ use and display of data in the Toronto Multiple Listing Service (MLS) system.
  • Toronto is one of Canada’s most expensive and least affordable housing markets. The average selling price of a home in Toronto has gone up from $485,520 to $782,129 since the Bureau began its litigation against TREB. The average sale price of a detached home sold through the TREB MLS is now more than a million dollars.
  • This case highlights the importance of innovation and dynamic competition, both of which benefit not only individual Canadians but the economy as a whole.
  • Anti-competitive activity that hinders innovation in the Canadian economy will continue to be a top priority for the Bureau.

I know what you’re thinking.

And trust me, I’m thinking the exact same thing!

The Supreme Court of Canada waited until I was on vacation to make their announcement!  Damn government…

Anyways, I’ve spoken to three media members about the case since the news broke last week, and I have a feeling that there’s a lot more news on the way.

But so far, some of the biggest news (and some of this has yet to be reported) is TREB’s response.  Or to be more specific, lack of a timely and detailed one.

The news came down on Thursday, and there was no shortage of coverage:

National Post: “Decisive Victory For Competition”

Huffington Post: “Canadian Home Buyers Will FinallY Get To See Homes’ Previous Sold Prices”

Canadian Press: “Toronto REaltors Can Now Publish Home Sales Data”

And so on.  The coverage continued into Friday as well.

Where things get interesting, or at least they did for me, while I was on vacation, and trying to make sense of all this, is from an organized real estate perspective.  What are TREB and RECO saying?  And how are they guiding us?

Here’s what we got on Thursday from TREB:

TREB respects the Supreme Court of Canada’s decision to not grant leave to hear TREB’s appeal. The Order of the Tribunal provides 60 days for compliance, unless it is modified.

As noted by the Supreme Court of Canada, of the approximately 600 leave applications submitted to the Court each year, only about 80 are granted. The possibility of succeeding in getting an appeal heard is in general remote. The Court’s role is not to correct errors that may have been made in the courts below. Rather it grants leave only where its decision is likely to have an impact on society as a whole.

TREB believes personal financial information of home buyers and sellers must continue to be safely used and disclosed in a manner that respects privacy interests and will be studying the required next steps to ensure such information will be protected in compliance with the Tribunal Order once that comes into effect.

However, although the Order of the Competition Tribunal provides 60 days, there are many ambiguities and uncertainties in the Order for which TREB is currently seeking further clarification.

TREB will continue to provide guidance to its Members as this matter continues to unfold.

As you would assume, I have a lot to say on this, but I want to put my thoughts together when I can be more eloquent, and when I’m not glassy-eyed and weary from a travel day.  So as promised, I will provide my thoughts on this battle that Realtors did not want, come Friday.

But since that email went out last Thursday, Realtors were left scrambling to try and figure out what they were and weren’t allowed to do.

Many Realtors were freaking out, seeing other sites and other agents getting the “jump” on them with the data, and these people were not impressed with the lack of a response from TREB.

Thankfully, TREB sent out a second email on Tuesday (five days is a long time, given the stakes here), which said the following:

Competition Tribunal Order June 3, 2016
re: Commissioner of Competition vs. Toronto Real Estate Board


*Please note that this is not an exhaustive list. As the situation continues to evolve, more questions and answers will be added as appropriate.

As a TREB Member, you remain bound by and required to comply with all applicable laws, rules and regulations, including all TREB By-Laws, Rules, and Regulations, PIPEDA, REBBA as well as all RECO Rules and Regulations.

Failure to comply could result in legal proceedings and /or revocation of your MLS® System Access

Q 1. How can consumers access the data?

A. Consumers can only access data through a password-protected virtual office website (VOW) operated by a TREB Member for informational purposes in the context of residential real estate transactions.

Q 2. What do I have to do to my website to be compliant?

A. You and your service provider (if applicable) must sign and agree to be bound by a Virtual Office Website (VOW) Agreement with TREB as well as ensure your compliance with the Authorized User Agreement (AUA). If you plan to make sold, withdrawn, expired, suspended or terminated listing information available, you must do so in compliance with the VOW Agreement. Members providing access are responsible for how their actual or potential clients and customers use the information. The information can only be used to provide residential real estate brokerage services between a Member and a client or customer, and cannot be monetized in any way. Members and/or their service providers will be legally liable for any misuse of the information by themselves, their clients or customers.

Additionally, all Members are still bound by applicable legislation and rules, including Personal Information, Protection and Electronic Documents Act (PIPEDA) and Real Estate and Business Broker’s Act, 2002 (REBBA, 2002) Code of Ethics and Regulations as well as provisions under Canada’s Anti-Spam Legislation (CASL) and the Do Not Call List.

Q 3. Am I allowed to scrape the data from the VOW feed? Can I use the data for any non-real estate brokerage business between a Realtor and client or customer?

A. No. The data cannot be scraped, mined, sold, resold, licensed, reorganized or monetized in any way, including through the sale of derivative products or marketing reports. The data cannot be used for commercial purposes other than to provide residential real estate brokerage services between a Realtor and a client or customer. Breach of this by either a Member or the member’s clients or customers may result in legal action (including damages) against the Member and the cancellation of TREB Membership and TREB MLS System access.

Q 4. Can I advertise sold prices now?

A. No. However, you can provide sold information so long as it is in accordance with the TREB Authorized User Agreement, VOW Agreement, the TREB By-Law, and all applicable laws and regulations. Please note that Members remain subject to REBBA with regards to advertising.

Q 5. When can we start posting the information online?

A. TREB will make this information available to be posted online by October 22, 2018. If TREB is able to make this information available sooner, it will provide notice to members.  However, the information can only be used for the purpose of engaging in residential real estate brokerage services. Any other purpose is not permitted under the VOW agreement.

Q 6. Can non-members post sold information?

A. The information cannot be used or posted by non-members without specific authorization from TREB.

Q 7. My client or customer doesn’t want the purchase price of its house disclosed online. Will that information be confidential?

A. That information could be made available on a VOW as of October 22, 2018, possibly sooner – in which case TREB will provide notice to its members. We will continue to listen to the feedback from Members, buyers and sellers regarding their personal information and take necessary steps to make sure that privacy laws are followed.

Q 8. What if a new client or customer doesn’t want the information posted on a go-forward basis?

A. We are reviewing the consent language in the buyer representation and listing agreements to consider this.

Q 9. What about historical sold price information where consents were given before websites were in existence?

A. TREB is reviewing the consent language; however, at this time we are required to make this information available.

Q 10. Do you anticipate other changes to the VOW agreement, buyer representation or listing agreement?

A. We are reviewing these agreements in light of our obligations under the order and privacy laws and will provide updates in due course.

We are also considering whether changes are needed regarding how long listing photos should remain active on a broker’s VOW website after the sale of a property has been completed.

Q 11. Does the order only affect the Toronto Real Estate Board?

A. At this time the order only applies to TREB and includes all listings that appear on the Stratus system (including listings from our partner boards, Durham Region Association of REALTORS® (DRAR) and Brampton Real Estate Board (BREB) and also interboarded listings. However, we expect that other boards will change their practices as well.

Q 12. Is the litigation with the Competition Bureau over?

A. There is no outstanding litigation with the Competition Bureau.

Q 13. Will my fees increase as a result of the decision?

A. Fees will not be impacted by this decision.

So there’s a sneak-peak into the going’s on behind the scenes in organized real estate.

And as I’ll explain on Friday, this whole thing is just ludicrous, since an overwhelming majority of the full-time, active, experienced, trustworthy agents out there actually want this data to be released.

But what does the Real Estate Council of Ontario (RECO) have to say about this?  RECO, who is actually responsible for licensing, as well as disputes and discipline?

Well, in my opinion, they completely passed the buck.

They sent out an email saying that nothing has really changed, as far as they are concerned.

Here’s the email:

On August 23, 2018, the Supreme Court of Canada declined the Toronto Real Estate Board’s (TREB’s) request to appeal a lower court ruling. That order required TREB to drop certain restrictions on the display and use of “sold” prices by TREB members who share the information through Virtual Office Websites (VOWs).

RECO has received questions about what this means for compliance with advertising requirements under the Real Estate and Business Brokers Act, 2002 (REBBA). The short answer is that there is no impact because the ruling applies to information that is not considered advertising.

To understand the issue, it’s important to define what a VOW is as defined in the Competition Tribunal decision: “a password-protected area of a brokerage’s website where consumers can access and search a database containing MLS information.”

Some have asked how this could comply with REBBA, which prohibits the advertising of the “sold” price without the parties having provided written consent to do so. However, the Competition Tribunal’s decision determined that sold information provided on a password-protected VOW does not constitute advertising, since providing that same information in other formats (such as a Comparative Market Analysis), or providing other MLS information, does not constitute advertising, either.

The order was upheld on appeal to the Federal Court of Appeal. The Supreme Court of Canada, by denying leave to appeal, has affirmed the order.

While the decision enables the posting of a property’s sold price on a VOW, the price of a conditional offer should not be shared.

Advertising sales prices without required consent still violates REBBA

To summarize: the Competition Tribunal’s decision applies specifically to data published on a password-protected VOW, and not to advertising. As such, the existing REBBA rules regarding advertising continue to apply. Without the written consent of the parties to the agreement, registrants must not include in any advertisement, details of an agreement of purchase and sale, such as:

  • the parties to the agreement;
  • the location of the property; or
  • any provision of the agreement relating to the price.

Advertising such information without written consent is a breach of REBBA, and RECO will deal with it accordingly.

So that’s a lot of information to digest, and a healthy read if you’re interested.

Part of the story here is going to be how organized real estate reacts to the Supreme Court’s ruling, and not only how – but when.

I understand that there are grey areas, and TREB needs to act in a professional, and diligent matter.

But I also know that TREB’s stance on this has been influenced by factors outside of the day-to-day operations in organized real estate, and whether that story comes out in the next few days, or whether I explain on Friday, should be an interesting little battle against time…

The post Competition Bureau vs. TREB appeared first on Toronto Realty Blog.

This post first appeared on | Toronto Real Estate, please read the originial post: here

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Competition Bureau vs. TREB


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