CREA approves new MLS rules

Move aims to block Competition Bureau challenge; consumer will now be able to pay an agent a flat fee to list on the MLS
Steve Ladurantaye
Globe and Mail Update Published on Monday, Mar. 22, 2010 2:36PM EDT Last updated on Monday, Mar. 22, 2010 7:18PM EDT
The Canadian Real Estate Association approved changes Monday that will give those who buy or sell their homes on its listing service more power to handle portions of the transaction on their own, but it was not enough to satisfy the Competition Commissioner.
In a move to cut off a challenge by the Competition Bureau, which feels the current system is too restrictive because anyone listing on the Multiple Listing Service must employ an agent through the entire process, the association's members voted at its annual general meeting in Ottawa to loosen its own rules.
Now, a consumer will be able to pay an agent a flat fee – zero is not an option – to list on the MLS, where about 90 per cent of all home sales are done. Agents must now pass along a seller's home phone number, if the seller chooses, directly to an interested buyer if asked.
“Through the proactive clarifications of the existing rules, CREA believes the concerns raised by the Competition Bureau are fully addressed,” the organization said in a news release. “At the same time, these amendments ensure the continued integrity of MLS systems and the accuracy of information on board MLS systems that Canadians have come to trust.”
The bureau disagreed, saying the change didn't go far enough because CREA could still change the rules at any point and place more restrictions on anyone who tried to offer innovative services.
CREA wouldn't provide further comment, with its legal counsel stating it would rather wait for the case to go before the Competition Tribunal. The association's president, Dale Ripplinger, said the changes “wouldn't make sense to anyone who wasn't a real estate agent,” before abruptly calling off a news conference.
The vote was seen as a way for Canada's real estate sales industry to satisfy concerns raised by the Competition Bureau, which has filed charges with the Competition Tribunal alleging the real estate association makes it impossible for any of its members to offer consumers fee-based services for particular portions of a transaction, such as listing on the MLS or negotiating a sale price.
This leads to higher prices for consumers, the Bureau says.
The proposed changes were a key pillar in the real estate organization's defence before the Tribunal. The association must submit its response to the charges by March 25 and the organization hoped a strong vote from its members on the key issues troubling the Competition Bureau would be enough to have the charges set aside.
The MLS has operated for more than 50 years and only registered agents are allowed to list homes on the service. The MLS trademark is owned by CREA, and each real estate board operates the service in its region. While anyone can sell their home on their own, having a listing on the service is seen as an integral part of achieving the best sales price.
A CREA spokesperson said the changes would be implemented “as soon as it is reasonable at each local board.”