Texas Register

TITLE 22 EXAMINING BOARDS
PART 23TEXAS REAL ESTATE COMMISSION
CHAPTER 535GENERAL PROVISIONS
SUBCHAPTER BGENERAL PROVISIONS RELATING TO THE REQUIREMENTS OF LICENSURE
RULE §535.2Broker Responsibility
ISSUE 08/31/2018
ACTION Proposed
Preamble Texas Admin Code Rule

(a) - (d)(No change.)

(e)A broker may delegate to another license holder the responsibility to assist in administering compliance with the Act and Rules, but the broker may not relinquish overall responsibility for the supervision of license holders sponsored by the broker. Any license holder who leads, supervises, directs, or manages a team must be delegated as a supervisor. Any such delegation must be in writing. A broker shall provide the name of each delegated supervisor to the Commission on a form or through the online process approved by the Commission within 30 days of any such delegation that has lasted or is anticipated to last more than three consecutive [six ] months. The broker shall notify the Commission in the same manner within 30 days after the delegation of a supervisor has ended. It is the responsibility of the broker associate or newly licensed broker to notify the Commission in writing when they are no longer associated with the broker or no longer act as a delegated supervisor.

(f)(No change.)

(g)A broker is responsible to ensure that a sponsored sales agent's advertising complies with §535.154and §535.155 of this title.

(h)Except for records destroyed by an "Act of God" such as a natural disaster or fire not intentionally caused by the broker, the broker must, at a minimum, maintain the following records in a format that is readily available to the Commission for at least four years from the date of closing, termination of the contract, or end of a real estate transaction:

  (1)disclosures;

  (2)commission agreements such as listing agreements, buyer representation agreements, or other written agreements relied upon to claim compensation;

  (3)communications with parties to the transaction[ work files];

  (4)offers, contracts and related addenda;

  (5)receipts and disbursements of compensation for services subject to the Act;

  (6)property management contracts;

  (7)appraisals, broker price opinions, and comparative market analyses; and

  (8)sponsorship agreements between the broker and sponsored sales agents.

(i)A broker who sponsors sales agents or is a designated broker for a business entity shall maintain, on a current basis, written policies and procedures to ensure that:

  (1)Each sponsored sales agent is advised of the scope of the sales agent's authorized activities subject to the Act and is competent to conduct such activities, including competence in the geographic market area where the sales agent represents clients.

  (2)Each sponsored sales agent maintains their license in active status at all times while they are engaging in activities subject to the Act.

  (3)Any and all compensation paid to a sponsored sales agent for acts or services subject to the Act is paid by, through, or with the written consent of the sponsoring broker.

  (4)Each sponsored sales agent is provided on a timely basis, before the effective date of the change, notice of any change to the Act, Rules, or Commission promulgated contract forms.

  (5)In addition to completing statutory minimum continuing education requirements, each sponsored sales agent receives such additional educational instruction the broker may deem necessary to obtain and maintain, on a current basis, competency in the scope of the sponsored sales agent's practice subject to the Act. At a minimum, when a sales agent performs a real estate brokerage activity for the first time, the broker must require that the sales agent receive coaching and assistance from an experienced license holder competent for that activity.

  (6)Each sponsored sales agent complies with the Commission's advertising rules.

  (7)All trust accounts, including but not limited to property management trust accounts, and other funds received from consumers are maintained by the broker with appropriate controls in compliance with §535.146.

  (8)Records are properly maintained pursuant to subsection (h) of this section.

(j)A broker or supervisor delegated under subsection (e) of this section must respond to sponsored sales agents, clients, and license holders representing other parties in real estate transactions within two[three] calendar days.

(k)A sponsoring broker or supervisor delegated under subsection (e) of this section shall deliver mail and other correspondence from the Commission to their sponsored sales agents within three [ 10] calendar days after receipt.

(l) - (m)(No change.)

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on August 17, 2018

TRD-201803570

Kerri Lewis

General Counsel

Texas Real Estate Commission

Earliest possible date of adoption: September 30, 2018

For further information, please call: (512) 936-3092



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