RULES AND REGULATIONS
Title 49--PROFESSIONAL AND VOCATIONAL STANDARDS
STATE REAL ESTATE COMMISSION
[49 PA. CODE CH. 35]
Consumer Notice--Commercial Property Exception
[37 Pa.B. 2291]
[Saturday, May 19, 2007]The State Real Estate Commission (Commission) amends § 35.284 (relating to disclosure of business relationships) to read as set forth in Annex A.
Omission of Proposed Rulemaking
Under section 204 of the act of July 31, 1968 (P. L. 769, No. 240) (45 P. S. § 1204), known as the Commonwealth Documents Law (CDL), the Board is authorized to omit the procedures for proposed rulemaking in sections 201 and 202 of the CDL (45 P. S. §§ 1201 and 1202) if the Board finds that the criteria of section 204 of the CDL are met.
Under section 204(3) of the CDL, proposed rulemaking has been omitted as unnecessary because the rulemaking is incorporating the statutory exception for commercial property transactions mandated by the act of October 27, 2006 (P. L. 1189, No. 125) (Act 125), which was effective on January 25, 2007.
Description of the Final-Omitted Rulemaking
Section 608 of the Real Estate Licensing and Registration Act (RELRA) (63 P. S. § 455.608) requires real estate licensees to provide consumers with a ''consumer notice'' that sets forth the various agency relationships licensees are permitted to have with consumers. The consumer notice was to be provided to every consumer at the initial interview regardless of the type of property.
Act 125 carved out an exception from the consumer notice requirement for transactions involving the sale or lease of commercial property to consumers who are not individuals. This final-omitted rulemaking incorporates the commercial property exception in § 35.284. The final-omitted rulemaking is necessary to avoid confusion. Without it, the Commission's regulations would conflict with amended section 608 of the RELRA.
Statutory Authority
Section 404 of the RELRA (63 P. S. § 455.404) authorizes the Commission to promulgate and adopt regulations to administer and effectuate the purposes of the RELRA. Amended section 608 of the RELRA requires licensees to provide the consumer notice to consumers prior to substantive discussion in real estate transactions, except for the sale or lease of commercial property to consumers who are not individuals.
Fiscal impact and Paperwork Requirements
The final-omitted rulemaking will not have a fiscal impact on, or create additional paperwork for, the regulated community or the political subdivisions of the Commonwealth. It eliminates the paperwork requirement for real estate transactions involving the sale or lease of commercial property to consumers who are not individuals.
Regulatory Review
Under section 5.1(c) of the Regulatory Review Act (71 P. S. § 745.5a(c)), on March 30, 2007, the Commission submitted a copy of the final-omitted rulemaking and a copy of a Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the Senate Consumer Protection and Professional Licensure Committee (SCP/PLC) and the House Professional Licensure Committee (HPLC). On the same date, the regulations were submitted to the Office of Attorney General for review and approval under the Commonwealth Attorneys Act (71 P. S. §§ 732-101--732-506).
Under section 5.1(j.2) of the Regulatory Review Act, on April 18, 2007, the final-omitted rulemaking was approved by the HPLC. The final-omitted rulemaking was deemed approved by the SCP/PLC on May 2, 2007. Under section 5.1(e) of the Regulatory Review Act, IRRC met on May 3, 2007, and approved the final-omitted rulemaking.
Additional Information
For additional information, submit inquiries to Patricia A. Ridley, State Real Estate Commission, P. O. Box 2649, Harrisburg, PA 17105-2649, (717) 783-3658, ST-REALESTATE@state.pa.us.
Findings
The Commission finds that:
(1) Public notice of the Commission's intention to amend its regulations under sections 201 and 202 of the CDL has been omitted under the authority of section 204 of the CDL because public comment is unnecessary in that the amendment incorporates a statutory exception required by Act 125.
(2) The amendment of the Commission's regulation in the manner provided in this order is necessary and appropriate for the administration of the RELRA.
Order
The Commission, acting under its authorizing statute, orders that:
(a) The regulations of the Commission, 49 Pa. Code Chapter 35, are amended by amending § 35.284 to read as set forth in Annex A.
(b) The Commission shall submit this order and Annex A to the Office of General Counsel and the Office of Attorney General for approval as to form and legality as required by law.
(c) The Commission shall certify this order and Annex A and deposit them with the Legislative Reference Bureau as required by law.
(d) This order shall take effect upon publication in the Pennsylvania Bulletin.
JOSEPH J. MCGETTIGAN, Sr.,
Chairperson(Editor's Note: For the text of the order of the Independent Regulatory Review Commission, relating to this document, see 37 Pa.B. 2355 (May 19, 2007).)
Fiscal Note: 16A-5617. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 49. PROFESSIONAL AND VOCATIONAL STANDARDS
PART I. DEPARTMENT OF STATE
Subpart A. PROFESSIONAL AND OCCUPATIONAL AFFAIRS
CHAPTER 35. STATE REAL ESTATE COMMISSION
Subchapter E. STANDARDS OF CONDUCT AND PRACTICE
GENERAL ETHICAL RESPONSIBILITIES § 35.284. Disclosures of business relationships.
(a) Disclosure to consumers seeking to sell or purchase residential or commercial real estate.
(1) Except as provided in subsection (e), a licensee shall provide the disclosure summary in § 35.336 (relating to disclosure summary for the purchase or sale of residential or commercial real estate or for the lease of residential or commercial real estate when the licensee is working on behalf of the tenant) to consumers seeking to purchase or sell real estate at the initial interview if the interview occurs in person.
(2) If the initial interview does not occur in person, the licensee shall provide the oral disclosure in § 35.339 (relating to the oral disclosure) at the initial interview and the written disclosure statement in § 35.336 no later than the earlier of:
(i) The first meeting that the licensee has in person with the consumer after the initial interview.
(ii) The time the licensee or any person working with the licensee first shows a property to the consumer.
(b) Disclosure to tenants seeking to lease residential or commercial real estate.
(1) Except as provided in subsection (e), a licensee who is working on behalf of the tenant shall provide the disclosure summary in § 35.336 as required in subsection (a).
(2) Except as provided in subsection (e), a licensee who is working on behalf of the owner shall provide the disclosure summary in § 35.337 (relating to disclosure summary for the lease of residential or commercial real estate when the licensee is working on behalf of the owner) to tenants seeking to lease residential or commercial property at the initial interview.
(c) Disclosure to consumers seeking to sell time shares. A licensee shall provide the disclosure summary in § 35.338 (relating to disclosure summary for time-share estates) to consumers seeking to purchase time-share estates at the initial interview.
(d) Signed disclosure. A licensee shall provide a copy of the signed disclosure to the consumers referenced in subsections (a)--(c) and retain the signed acknowledgment under § 35.286 (relating to retention and production of records). If a consumer refuses to sign the acknowledgment, the refusal shall be noted on the acknowledgment.
(e) Exception. The disclosures required under subsections (a) and (b) do not apply to transactions involving the sale or lease of commercial property, as defined in section 201 of the act (63 P. S. § 455.201), to consumers who are not individuals.
[Pa.B. Doc. No. 07-883. Filed for public inspection May 18, 2007, 9:00 a.m.]
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