On August 23, 2018 the Supreme Court of Canada dismissed TREB’s application to appeal the Competition Tribunal’s ruling that TREB abused its dominant position, finding that:
- TREB controlled the market for MLS® System-based residential real estate services owing to its control over the MLS® System, a key input for the supply of residential real estate services;
- the purpose of TREB’s restrictions was to resist the emergence of Virtual Office Website (VOW) brokerages due to concerns that VOWs could lead to greater competition among its members; and
- TREB’s restrictions substantially prevented competition.
What is a Virtual Office Website (VOW)?
A VOW is a password-protected area of a brokerage’s website where consumers who have entered into a lawful broker-consumer relationship with the brokerage can log-in to view listing information provided to the brokerage through an MLS® System VOW data feed, subject to certain terms and conditions.
A VOW is therefore very different from a website that advertises listing information.
It is up to brokers of record to determine if their individual salespeople and brokers are allowed to provide VOWs using the data feed available to the brokerage from RAHB.
On August 28, 2018 RECO clarified that including sold data on a password protected VOW does not go against REBBA 2002 advertising rules – http://www.reco.on.ca/professionals-news/supreme-court-declines-hear-trebs-appeal-competition-bureau-means-compliance-rebba/.
What does this mean?
Real estate boards and associations that currently have a VOW data feed, or are considering implementing one (as RAHB currently is) are expected to follow the decision of the Supreme Court of Canada and the Competition Tribunal with respect to making “Disputed Data” available for members who wish to implement password protected virtual office websites.
The Disputed Data means property listing related to:
- Sold prices
- Pending sold prices (where no condition remain other than closing)
- Withdrawn/ expired/ suspended/ terminated status, and
- Cooperating commission
Immediate Next Steps for RAHB:
- A contract regarding VOWs and related MLS® rules and regulations is being drafted now in consultation with RAHB’s and CREA’s lawyers.
- This information is to be reviewed by RAHB’s Board of Directors on October 30, 2018.
- Implementation at RAHB is expected to occur in early November 2018.
Follow RAHB’s weekly e-newsletter, NewsReal, and information posted to the RAHB Blog at blog.rahb.ca for updates.
Supreme Court of Canada Decision
August 23, 2018 – The Supreme Court of Canada (SCC) ruled in favour of the Bureau and dismissed TREB’s application to appeal, meaning the Competition Tribunal order would now take effect.
December 2017 – Following the Tribunal’s ruling, TREB filed a motion to appeal the decision with the Federal Court of Appeal (FCA), which was dismissed. TREB then filed an application for leave to appeal to the SCC.
Competition Tribunal Ruling Against TREB
June 2016 –The Tribunal ordered TREB to stop its practice of anti-competitive acts, as well as other measures necessary to restore competition.
April 2016 – The Competition Tribunal ruled that TREB had abused its dominant position, finding that:
TREB Litigation with the Competition Bureau
2015 – TREB forced real estate brokers to stop sharing house sale information publicly with customers with the threat of revoking access to the MLS® System.
2014 – Supreme Court of Canada refused to hear an appeal of the Federal Court’s decision, and sent the case back to the Competition Tribunal for another hearing.
May 2011 – The Competition Bureau first took action against TREB when it filed an application with the Competition Tribunal alleging it had abused its dominant position in the market for residential real estate brokerage services.
The case focused on TREB restrictions on the use and online disclosure of certain important data in the MLS® System. While TREB allowed its members to share data with clients by hand, e-mail, or fax, it prevented the same data to be displayed online through Virtual Office Websites (VOWs).
TREB also excluded sales data from its electronic data feed to its members, limiting their ability to develop new and sophisticated analytical tools. The Bureau alleged that TREB’s restrictions limited the impact of new and innovative business models and services that were a competitive threat to TREB members who preferred to compete using more traditional business models.
TREB’s argument claimed that these restrictions were designed to protect consumer privacy to comply with federal privacy law and requirements of the provincial real estate regulator.
Actions Leading to TREB’s Litigation with the Competition Bureau
2009 – Separate lawsuit brought against TREB for anti-competitive actions
2004 – Lawsuit with Realtysellers was settled
2002 – TREB and CREA were sued by Realtysellers for alleged anti-competitive practice
Federal Court of Appeal Decision dated December 21, 2017
Competition Tribunal Ruling
Competition Tribunal Case Information
Backgrounder: Abuse of dominance by the Toronto Real Estate Board
TREB Frequently Asked Questions Regarding Tribunal Decision