Competition Bureau Canada

Competition Bureau Canada

May 27, 2011 12:36 ET

Competition Bureau Sues Canada's Largest Real Estate Board for Denying Services Over the Internet

OTTAWA, ONTARIO--(Marketwire - May 27, 2011) - The Competition Bureau announced today that it has filed an application with the Competition Tribunal seeking to prohibit anti-competitive practices by the Toronto Real Estate Board (TREB) that are denying consumer choice and the ability of real estate agents to introduce innovative real estate brokerage services through the Internet.

TREB is the largest real estate board in Canada, with approximately 31,000 members. It owns and operates the Toronto Multiple Listing Service system (the Toronto MLS system), which contains current property listings and historical information about the purchase and sale of residential real estate in Toronto and the surrounding area. The vast majority of local real estate transactions make use of the Toronto MLS system, which is an essential tool for agents to help customers buy and sell homes. TREB is restricting how its member agents can provide information from the Toronto MLS system to their customers, thereby denying member agents the ability to provide innovative brokerage services over the Internet.

"Today, consumers are demanding a greater selection of service and pricing options when buying or selling their homes and many agents are eager to accommodate them," said Melanie Aitken, Commissioner of Competition. "Yet TREB's leadership continues to impose anti-competitive restrictions on its members that deny consumer choice and stifle innovation."

Toronto MLS information is controlled by TREB and is only accessible to its members. It is much more detailed than what is available on public sites, such as Realtor.ca. For example, the Toronto MLS system contains data about previous listing and sale prices, historical prices for comparable properties in the area, and the amount of time a property has been on the market.

Because of TREB's restrictive practices, agents do not have the flexibility to share this important data with customers in innovative new ways, such as through password protected Web sites, also called Virtual Office Web sites (VOWs). VOWs permit a customer to search a full inventory of listings containing up to date data online, before making the decision to tour a home or attend an open house. This enables customers to be more selective and focused, and agents to spend less time trying to find an appropriate property for a specific customer.

While agents can provide detailed MLS listing information not available on Realtor.ca to customers by hand, mail, fax, or email, TREB's anti-competitive practices effectively prevent agents from providing the same MLS listing information to customers via a password-protected Web site. As a result, there are currently no VOWs operating in the Toronto real estate market that enable customers to search a full inventory of listings.

"When the Bureau identifies anti-competitive behaviour, our first preference is always to reach an agreement that fully resolves our concerns," added Ms. Aitken. "Consistent with the Bureau's practice, we shared our concerns with TREB, as well as what would be necessary to address them. Ultimately, it was necessary for us to seek a legally binding order from the Tribunal to ensure greater competition and increased innovation in the market for real estate services in Toronto and the surrounding area."

A copy of the Bureau's application will be available shortly on the Competition Tribunal Web site.

The Competition Bureau, as an independent law enforcement agency, ensures that Canadian businesses and consumers prosper in a competitive and innovative marketplace.

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