2024 Rules Amendments: What the Changes Mean for Licensees

On February 1, 2024, BCFSA is bringing into force amendments to the Real Estate Services Rules (the “Rules”) related to data collection, written disclosures, and record retention.

Under the new Rules, licensees will be required to:

• Report information to BCFSA on an ad hoc, periodic and contingent basis as and when requested by BCFSA;
• Make disclosures of conflicts of interest in writing and to retain the disclosure; and
• Retain copies of any offers prepared or received by, or on behalf of, a brokerage in relation to a real estate trade or prospective trade.

What Do These Rule Changes Mean for Licensees?

1. Data Collection

BCFSA already has broad data collection authorities under the Rules that allows it to request licensee records and information, including for the purposes of audits, investigations, and regulatory decision-making. The new Rules strengthen and clarify those authorities to ensure BCFSA is able to fulfill its mandate.

Licensees will be notified by BCFSA of any specific requests for information. For general data calls, specific requirements (including the form and content of the requested information) will be outlined in advance through regulatory statements. 

BCFSA complies with all privacy laws. Every request for information is reviewed carefully – BCFSA conducts privacy impact assessments and security threats and risk assessments on its initiatives and systems to ensure compliance with legislation, and to make reasonable security arrangements to protect personal information.

2. Conflicts of Interest

A conflict of interest can be real or perceived and includes any situation where a licensee’s interests (social, financial etc.) might compromise their ability to act in their client’s best interest. It is a long-standing requirement for licensees to be proactive in anticipating and avoiding conflicts of interest and when conflicts do arise, to promptly disclose that conflict to their clients.

With the introduction of the new Rules, licensees will be required to make disclosures of conflicts of interest in writing. A copy of this disclosure must be provided to their managing brokers and retained as part of brokerage records.

Some conflicts of interest must be made following a prescribed format, such as when disclosing an interest in trade. However, when disclosing general conflicts of interest, there is no prescribed form for making this disclosure. The disclosure can be made by email or in print. At a minimum, the disclosure should include:

• Your name;
• The name of the recipient of the disclosure;
• A delivery receipt or other acknowledgment of receipt from the recipient;
• The date on which the disclosure was made; and
• A full and clear description of the nature of the conflict.

Written disclosures support greater transparency for consumers, who will be able to refer to the content of the disclosure to ask questions and seek independent advice. Written disclosures also allow licensees to have a full record of what information was disclosed to clients and when, and to update the disclosure (in writing) as needed as circumstances change.

Additional information on conflicts of interest and disclosure requirements can be found in BCFSA’s Real Estate Knowledge Base.

3. Offer Retention

Brokerages are now required to retain all offers for the purchase or sale of real estate or for the assignment of a contract for the purchase and sale of real estate, made or received by one of its licensees. This includes all offers and counteroffers formally made or received by the buyer or seller. This does not include informal discussions of price. As part of this requirement, representatives are obligated to promptly provide the managing broker with originals or copies of all offers made or received.

If an offer is part of another record that is required to be retained (e.g. CPS), the brokerage is not required to obtain duplicate copies.

• Reminder: it is a licensee’s responsibility to ensure that all relevant records are provided to their managing broker promptly. This includes documents such as required disclosures, written service agreements, contracts of purchase and sale, etc. Together with their managing broker, licensees should have policies and processes for collecting these documents and providing them to their managing broker for retention.

More information on brokerage document retention requirements can be found in BCFSA’s Real Estate Knowledge Base.