Parameters to be respected when developing a business plan

Principle

Only holders of a licence issued by the OACIQ can offer real estate brokerage services (for more details and examples of services covered, see: What are the services covered by the Real Estate Brokerage Act?)

In addition to the specific cases listed in Exceptions, the Act provides that if you are not a licence holder, you cannot claim or receive compensation from your clients for the brokerage services provided. This means that if your clients do not pay you, you will not be able to sue them.

Excluded persons

The following persons are not subject to the Real Estate Brokerage Act if they act as intermediaries in a real estate brokerage contract in the course of their functions::

• Lawyers and notaries;
• Liquidators, sequestrators, and trustees in bankruptcy;
• Trustees;
• Certified appraisers.

Excluded services

Likewise, the Act excludes the following services when they are rendered by certain categories of persons:  

• Services rendered by forest engineers in relation to forest property;
• Services rendered by certified professional accountants if the services rendered are related to the purchase or sale of an enterprise;
• Services rendered by trust companies with regard to immovable property they hold or administer for others;
• Services rendered by certified administrators incidental to their services in the course of their real estate management function. ATTENTION: this exception does not apply to chiefly residential immovables containing less than five dwellings or properties that are subject to an agreement or declaration of co-ownership. For such immovables, even if you are a certified administrator, you must have a licence.

Finally, the Act provides that if you offer your services to the property owner, you are not required to hold a licence if you are:

• His or her spouse;
• One of his or her children;
• His or her father, mother or one of his or her parents;
• His or her brother or sister;
• The sole shareholder of a legal person, owner of the marketed property.

Special cases depending on the field in which the services are rendered

Depending on your business sector, you may also be subject to further exceptions. For more details, see: What are the services covered by the Real Estate Brokerage Act?

If you are not licensed by the OACIQ, you must ensure that you do not offer services covered by the Real Estate Brokerage Act.

Otherwise you will violate the Act. More specifically, this means that you will be exposed to criminal prosecution before the Court of Québec. If you are found guilty, you will liable to a fine of not less than $2,500 nor more than $62,500 in the case of a natural person and to a fine of not less than $5,000 nor more than $125,000 in the case of a legal person.

The minimum and maximum fines are doubled for a second or subsequent offence.

Note that in case of a prosecution in courts, the following elements do not constitute a defence:

• Location of the immovable and place of residence of the parties

It is not the location of the immovable or the place of residence of a seller or buyer that determines the liability of brokerage activities to the Real Estate Brokerage Act, but the place where the brokerage acts are performed. Therefore, any real estate brokerage activity carried out in Québec is subject to the Real Estate Brokerage Act regardless of the location of the immovable or the place of residence of the parties.

• Publicity

Just because your advertisements indicate that you are not a real estate broker does not mean that the Real Estate Brokerage Act does not apply to you.

• Amount of transaction completed

The Real Estate Brokerage Act  does not take into account the amount of financing obtained or the value of the immovable sold. You must have a licence to render a service covered by the Act.

a) You must have a licence if:

For example, you offer one or more of the services described below, for others and in exchange for compensation including:

i. Putting parties in contact to carry out a sale or purchase of a residential immovable, for instance, by:

• Providing information on a property;
• Marketing a property that does not belong to you;
• Advertising an immovable by placing ads on the web or in newspapers for example;
• Attending visits or making visits alone;
• Acting as a contact person between the interested parties.

ii. Negotiating or offering advice, including when:

• Marketing an immovable
• Drafting various transaction documents for the completion of a real estate transaction
• Presenting transaction proposals

iii. Soliciting clients to offer them your services to search for buyers or sellers (directly or indirectly, for example, by operating a website incorporating a notification system for buyers and informing them when a property that meets their search criteria is added to the website).

b) You are not required to hold an OACIQ licence if:

i. Your services are not covered by the Real Estate Brokerage Act

• You do not offer your services to others. For example, an employee who, in the course of his main occupation, offers real estate brokerage services on behalf of his employer when the employer is not a broker or an agency, is not required to obtain a licence from the OACIQ. If this employee is already a licensee, he is required to comply with all his obligations under the Real Estate Brokerage Act.
• You offer your services for free. (Please note that the Act provides that when a person is a party to a real estate brokerage contract as an intermediary, the person is presumed to have bound himself or herself in exchange for remuneration.)

Attention!


Compensation is not limited to the receipt of an amount of money.

Remuneration, in the broad sense of the term, can take many forms. It may include any form of benefit received in exchange for services rendered (e.g.: trips, car, purchase coupons, profit for a company, etc.).

ii. You benefit from an exception

See Exceptions

a) You must have a licence if:

For example, you offer one or more of the services described below for others and in exchange for compensation, including:

i. Putting parties in contact to carry out a real estate transaction, especially by:

• Providing information on a property
• Marketing a property that does not belong to you
• Advertising an immovable by placing ads on the web or in newspapers for example
• Attending visits or making visits alone
• Contacting interested parties
• Providing the name and contact information of a person interested in buying to the seller
• Obtaining contact information of buyers or sellers and sending them to different real estate agencies or brokers

ii. Negotiating or offering advice, including when:

• Marketing an immovable
• Drafting various transaction documents for the completion of a real estate transaction
• Presenting transaction proposals

iii. Soliciting clients to offer them your services to search for buyers or sellers (directly or indirectly, for example, by operating a website incorporating a notification system for buyers and informing them when a property that meets their search criteria is added to the website).

b) You are not required to hold an OACIQ licence if:

i. Your services are not covered by the Real Estate Brokerage Act

• Your services concern an enterprise whose assets, based on their market value, do not mainly consist of immovable property.
  
  The sale of an enterprise corresponds to the sale of all tangible (palpable, such as equipment) and intangible (such as the business name and clients) property that a natural or legal person brought together to carry out commercial or industrial activity.
  
  The transactions covered by the Act are those relating to an enterprise whose assets, based on their market value, mainly consist of immovable property.
  
  Conversely, a transaction involving an enterprise whose assets consist mainly of movable property is not considered as a real estate transaction within the meaning of the Act.
• You do not offer your services to others. For example, an employee who, in the course of his main occupation, offers real estate brokerage services on behalf of his employer when the employer is not a broker or an agency, is not required to obtain a licence from the OACIQ. If this employee is already a licensee, he is required to comply with all his obligations under the Real Estate Brokerage Act.
• You offer your services for free.

Attention!


Compensation is not limited to the receipt of an amount of money.

Remuneration, in the broad sense of the term, can take many forms. It may include any form of benefit received in exchange for services rendered (e.g.: trips, car, purchase coupons, profit for a company, etc.)

ii. You benefit from an exception

• See Exceptions.
• You are a member of the Ordre des comptables professionnels agréés du Québec dealing with the sale of enterprises.

You are not required to hold an OACIQ licence.

Attention!


Leasing brokerage is no longer reserved for OACIQ licence holders in Québec. However, real estate brokerage (including leasing brokerage) licensees whose licence is issued in another jurisdiction (another Canadian province or another country) must obtain a licence or special authorization from the OACIQ to be able to carry out leasing brokerage activities in Québec. Only licence holders may use the real estate broker’s title or any other title suggesting that they are authorized to act in that capacity. A person who violates the law in this regard may be fined. Section 124 of the Real Estate Brokerage Act states that any person who does not hold the licence required under this Act and enters into a brokerage contract or claims to have the right to engage in such activities or acts in such a way as to lead others to believe that the person is authorized to engage in such activities is guilty of an offence.

Accordingly, brokers who hold a brokerage licence issued by a regulator outside Québec cannot suggest or lead others to believe that they are licensed by the OACIQ. They must hold a licence or certificate issued by the OACIQ to be able to act as brokers. Otherwise, they could be prosecuted.