The Toronto Real Estate Board says the privacy rights of consumers are at stake in a lawsuit brought against the board by Canadian regulators regarding the operation of virtual office websites (VOWs).

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. In June, TREB — North America’s largest real estate board at 31,000 members — published a proposed policy that would allow members to operate VOWs.

Last month, in an amended complaint, the Competition Bureau said the proposed policy restricted the display of sold and pending listings and the compensation offered to the buyer’s broker through VOWs, and alleged the policy would "entrench and perpetuate the traditional ‘bricks and mortar’ business model for providing real estate brokerage services," and "constitute a further anti-competitive act" under Canada’s Competition Act.

TREB filed a formal response to the amended complaint Friday denying that "TREB’s policies with respect to the use of and access to the TREB MLS constitutes a practice of anti-competitive acts."

The response added that TREB’s policies "have been formulated to safeguard the privacy rights of TREB’s members and TREB’s members’ customers … in their individual listings and to ensure TREB and its members are compliant with their respective statutory obligations."

In a statement also released Friday, the board said the demands in the bureau’s amended suit endanger consumers’ privacy rights.

"The VOW policy will allow for secure password-protected websites designed to allow consumers to search and display MLS listings data, with the benefit of a Realtor member’s oversight, supervision and accountability," the board said in the statement.

The board also charged in its statement that "the (bureau’s) commissioner is pressuring TREB to release private data about individual consumers openly on the Internet. This could include personal contact and financial information including sale prices. TREB believes that would be reckless and a violation of the law and will harm consumers in the process of buying and selling real estate."

Greg Scott, senior communications adviser to the Competition Bureau, told Inman News today that real estate brokers already release the information that TREB would restrict VOWs from providing to consumers in person, through email or fax. "The information that (TREB officials) say that they can’t provide for reasons of privacy is routinely being handed out in brokerage offices," he said.

"Agents who want to operate virtual office websites should be able to provide the routine information that they provide through the Internet. We feel (TREB is) denying consumer choice and the ability of real estate brokerages to innovate. We’ve looked at their proposed changes and they’re ineffective in addressing the competitive harm (noted) in our application," he added.

Richard Silver, TREB’s president, countered that sold and pending listings information cannot be published without "significant consents from buyer and seller," citing other regulatory agencies: Canada’s Privacy Commissioner and the Real Estate Council of Ontario (RECO).

While an agent may supply such information to a client in order to assist that client with a transaction, "it’s publishing that information to the public so that anybody can see it or sign on and see it (that’s the problem)," Silver said. 

"I think what’s happening is we’re getting caught between different levels of government and that’s our frustration," he added.

Silver said the proposed policy will be approved on Thursday by TREB’s board of directors and will go into effect five days after it is posted to the TREB MLS system, which is scheduled for either Thursday or Friday. He estimates it will take about a month to create the VOW feed for TREB’s membership.

The Competition Bureau said it plans to submit an official reply to TREB’s response to the amended complaint within 14 days. 

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