The Texas Real Estate Commission (TREC) proposes new 22 TAC §535.154, Registration and Use of Alternate, Team and Assumed Business Names Used in Advertisements and new 22 TAC §535.155, Advertisements, in Chapter 535, General Provisions.

The new rules are proposed to align the rules with statutory changes adopted in SB 2212 by the 85th Legislature effective September 1, 2017, and to implement changes to the rules recommended by the Commission's Executive Committee following over a year of study and input from stakeholders. The rule was split into two rules to separate out name and registration of name requirements from advertising requirements. Most of the new requirements involve changes to how team names are defined, registered and used. New statutory provisions and a consensus that team names presently cause most of the consumer confusion in advertisements drove these changes. Much of the new rules contain provisions that are similar or identical to the current rule but have been rewritten for clarity. Additionally, new definitions were added, the requirement for notifying the Commission of the use of an alternate name, assumed business name or team name was amended to require registration of the names with the Commission prior to their use, and the current safe harbor policy regarding the size of the broker's name in advertisement was put into the rule.

Kerri Lewis, General Counsel, has determined that for the first five-year period the proposed new rules are in effect there will be no fiscal implications for the state or for units of local government as a result of enforcing or administering the sections. There is no significant anticipated impact on small businesses, micro-businesses or local or state employment as a result of implementing the sections. There will be varied anticipated economic cost to some license holders who are required to comply with the proposed new rules. Not all license holders will need to change their signage under the revised statute and rules; however, most teams will incur the cost of signage replacement. To ameliorate this expense, the Commission will extend the effective date of the rule upon adoption for six months to allow those license holders to spread out the cost of new signage over time.

Ms. Lewis also has determined that for each year of the first five years the sections as proposed are in effect, the public benefit anticipated as a result of enforcing the sections will be compliance with statutory changes, greater clarity in the rule, fewer misleading advertisements and greater consumer protection.

Comments on the proposal may be submitted to Kerri Lewis, General Counsel, Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188 or via email to general.counsel@trec.texas.gov. The deadline for comments is 30 days after publication in the Texas Register.

The new sections are proposed under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102.

The statutes affected by this proposal are Texas Occupations Code, Chapter 1101. No other statute, code or article is affected by the proposed amendments.