Administrative Penalty Framework Fact Sheet

On February 1, 2021, amendments to the Real Estate Rules take effect which:

  • expand the list of designated contraventions eligible for an administrative penalty,
  • update the administrative penalty amounts, and
  • create four separate categories of administrative penalties, with increasing penalty amounts corresponding to the level of public risk.

To maintain and strengthen protection for real estate consumers in BC, RECBC uses a range of enforcement tools to encourage compliance by real estate professionals and, when necessary, to respond to non-compliance that could put consumers at risk.

Members of the public and real estate professionals agree that they want RECBC to deal effectively and consistently with non-compliance, and to do so in a timely way. Administrative penalties help RECBC to meet these important goals, allowing RECBC to efficiently address minor contraventions where there has been no consumer harm.

Administrative penalties are used in the regulation of many industries. They are an efficient way for regulators to promote fair practices, encourage compliance and protect the public.

By increasing the use of administrative penalties, RECBC will provide greater certainty and consistency for real estate professionals and a clear message for the public about the consequences of non-compliance. When administrative penalties are used in appropriate cases, real estate professionals and consumers can expect quicker resolution of many minor contraventions. This allows RECBC’s investigators and legal professionals to focus their attention on cases involving serious and unethical conduct by real estate professionals.

  • What are administrative penalties?

    Administrative penalties are monetary penalties that RECBC may impose on real estate professionals or brokerages who fail to comply with the Real Estate Rules (“rules”), which are legal requirements. The Superintendent of Real Estate has identified a list of designated contraventions for which RECBC can impose administrative penalties, and has set the amounts of the penalties, according to the level of public risk associated with the contravention.

    Under section 56 of RESA, the Superintendent may, by rule, designate contraventions of specific rules as being subject to administrative penalties and establish the amount of administrative penalty that may be imposed, up to a maximum of $50,000.

    RECBC can use administrative penalties in cases where a more serious sanction is required than a letter of advisement (warning), but which don’t require formal discipline proceedings. They help ensure that minor contraventions can be dealt with quickly.

    The Administrative Penalties and RECBC’s Administrative Penalty Guidelines help provide predictability to real estate professionals about the likely outcome of many minor contraventions.

  • Are administrative penalties new?

    Administrative penalties for real estate professionals were first introduced with the Real Estate Services Act in 2005. The intention was to provide an efficient mechanism for RECBC to encourage compliance in cases where a designated contravention was unlikely to result in material harm to consumers. At that time, eight contraventions were eligible for administrative penalties, and the number of eligible contraventions has grown since then.

    The list of designated contraventions includes many common contraventions and allows RECBC to divert minor matters away from the formal disciplinary hearing process.

  • What kinds of misconduct do administrative penalties apply to?

    Before RECBC can issue an administrative penalty, three conditions must be met:

    1. One or more contraventions have occurred
    2. The contravention(s) is (are) designated in the Rules as being subject to administrative penalties
    3. The circumstances of the contravention(s) meet the eligibility criteria described in the Administrative Penalty Guidelines as the Administrative Penalty Eligibility Test (APET), including:
    • The contravention did not involve material harm to a consumer or harm the reputation of the real estate industry
    • The contravention was unintentional
    • The real estate professional did not benefit from putting a client or consumer at risk
    • When the contravention was brought to the real estate professional’s attention, the real estate professional promptly took available and reasonable steps to correct or remedy the contravention
    • There is no evidence that the real estate professional was acting other than in good faith

    See the Administrative Penalty Guidelines for a full list of eligibility criteria.

    Administrative penalties are not available for contraventions involving unethical conduct, such as dishonesty, fraud, deceptive dealing or intentional non-compliance.

  • Are administrative penalty decisions published?

    RECBC is committed to openness and transparency, which includes sharing information about real estate professionals and brokerages that do not comply with their legislated requirements. As part of that commitment, information about administrative penalties issued by RECBC will be published on RECBC’s website.

    RECBC publishes quarterly statistical information on all administrative penalty decisions on our Statistics page.

    When an administrative penalty is more than $1000, RECBC will publish the decision on its Decision page for a period of five years. Publication is intended to promote transparency and accountability and provide an educational opportunity for real estate professionals and the public.

    See our Publication Policy for more information about what RECBC publishes.

  • How do administrative penalties benefit real estate professionals and consumers?

    The new administrative penalty framework is in the public interest; it allows RECBC to use administrative penalties, along with other measures, to promote compliance and reduce risks to the public.

    RECBC’s Administrative Penalty Guidelines help provide predictability to real estate professionals about the likely outcome of many minor contraventions, and help ensure that minor contraventions can be dealt with quickly and efficiently. Increasing efficiency will allow RECBC to focus resources on serious, unethical conduct, enhancing consumer protection and the reputation of the real estate industry.

    Recognizing that mistakes happen and that not all contraventions warrant a formal disciplinary proceeding, the expanded administrative penalties help ensure that RECBC’s response is proportionate to identified risks and other unique circumstances of each matter.

    The application of administrative penalties is transparent: the Administrative Penalty Guidelines are available online and set out the categories, criteria and process for issuing a penalty. They also include information about requesting a reconsideration of a penalty.

    See the Administrative Penalty Guidelines for more information.

  • How do administrative penalties affect law-abiding real estate professionals?

    We’ve heard from real estate professionals and the public that they want complaints of misconduct resolved faster. Administrative penalties help enhance the flexibility and efficiency of RECBC’s process for responding to complaints and non-compliance, speeding up the investigation and resolution of all kinds of complaints, including those that are not eligible for administrative penalties (e.g. serious and unethical).

    For example, RECBC can now apply daily administrative penalties for some contraventions. That will be a useful tool for RECBC to gain compliance by providing real estate professionals with an incentive to quickly fix non- compliance (e.g. rectify contraventions of section 4-7 which prohibits false or misleading advertising).

  • Can a real estate professional dispute an administrative penalty?

    Yes, the Real Estate Services Act (RESA) has specific provisions allowing a real estate professional to request reconsideration of a RECBC decision to impose an administrative penalty.

    Under section 57(4)(a) of RESA, RECBC may cancel an administrative penalty if it is satisfied that the real estate professional exercised due diligence to prevent contravention of the rule.

    The deadline to make a reconsideration request is within 14 days of the date on which the administrative penalty decision was issued.

    See the Administrative Penalty Guidelines for more information on the reconsideration process.

  • Can the new administrative penalties be applied to contraventions that happened in the past?

    The expanded list of designated contraventions and the updated penalty amounts cannot be applied retroactively, without the consent of the real estate professional.

    However, where a contravention would be eligible for an administrative penalty, but it occurred before the proposed rules came into force, a real estate professional may find the updated administrative penalty amounts helpful to inform a consent order proposal.

  • Will RECBC issue administrative penalties for every breach of a designated contravention?

    RECBC looks at the facts of each case to determine whether an administrative penalty is appropriate. There may be cases where RECBC issues a Notice of Discipline Hearing, or circumstances where RECBC decides to issue a letter of advisement (warning).

    RECBC will be guided by the Administrative Penalty Guidelines, which set out the criteria for a designated contravention to be eligible for an administrative penalty, the process for issuing an administrative penalty, and the reconsideration process.

  • Will administrative penalties be affected by the integration of RECBC and OSRE with the BC Financial Services Authority later this year?

    Administrative penalties are part of an efficient and proportionate mechanism to address complaints and real estate professional misconduct.

    The transition to the single regulator for real estate in 2021 may provide an opportunity to assess the effectiveness of the administrative penalty framework, and consider whether changes could be made to improve its functioning such as further expanding the designated contraventions.