Canadian regulators say a proposal by the Toronto Real Estate Board (TREB) to allow real estate brokers to operate "virtual office websites" (VOWs) doesn’t go far enough, and that they will continue to press their case against the board in an administrative court.

Canada’s Competition Bureau filed suit against TREB in May, claiming the board hasn’t allowed brokers to provide consumers with access to detailed multiple listing service (MLS) data through password-protected VOWs like those operated by ZipRealty and Redfin in the U.S.

The bureau said TREB’s restrictions on VOW brokerages are anti-competitive, because VOWs often have lower operating costs and offer reduced commission rates or rebates to customers.

TREB — which is North America’s largest real estate board, with 31,000 members — published a proposed VOW policy in June, saying members would have 60 days to comment. TREB said it had begun developing the VOW policy independently the previous summer, "in response to a changing business environment."

After reviewing TREB’s proposed VOW policy, the Competition Bureau amended its complaint with Canada’s Competition Tribunal, an administrative court that decides disputes over issues ranging from mergers to restrictive trade practices.

TREB’s proposed VOW policy includes obligations and restrictions on the display of sold and pending listings, and the compensation offered to the buyer’s broker, the Competition Bureau said in its amended complaint.

The proposed policy would "entrench and perpetuate the traditional ‘bricks and mortar’ business model for providing real estate brokerage services," the Competition Bureau alleged, and "constitute a further anti-competitive act" under Canada’s Competition Act.

TREB said the restrictions are necessary to comply with consumer privacy laws, and characterized the amended complaint as "more legal and publicity maneuvers."

"TREB believes strongly in open competition within a housing market where consumers can be ensured privacy and quality," the board said in a statement, and also charged that the Competition Bureau "is pressuring TREB to go further to release private data about individual consumers openly on the Internet. TREB believes that would be reckless and … a violation of the law."

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