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TITLE 22EXAMINING BOARDS
PART 23TEXAS REAL ESTATE COMMISSION
CHAPTER 535GENERAL PROVISIONS
SUBCHAPTER EREQUIREMENTS FOR LICENSURE
RULE §535.53Business Entity; Designated Broker

(a) Business Entity.

  (1) A business entity must be qualified to transact business in Texas to receive, maintain or renew a broker license.

  (2) A Franchise Tax Account Status page from the Texas Comptroller of Public Accounts issued within 21 days prior to the date of its license or renewal application constitutes evidence of being qualified to transact business in Texas.

  (3) A business entity must notify the Commission not later than the 10th day after the date it receives notice that it is not qualified to transact business in Texas.

  (4) A foreign business entity must meet the additional requirements of §535.132 of this chapter to be eligible for a broker's license.

(b) Designated Broker.

  (1) For the purposes of qualifying for, maintaining, or renewing a license, a business entity must designate an individual holding an active Texas real estate broker license in good standing with the Commission to act for it.

  (2) An individual licensed broker is not in good standing with the Commission if:

    (A) the broker's license is revoked or suspended, including probated revocation or suspension;

    (B) a business entity licensed by the Commission while the broker was the designated broker for that business entity had its license revoked or suspended, including probated revocation or suspension, in the past two years;

    (C) the broker has any unpaid or past due monetary obligations to the Commission, including administrative penalties, Real Estate Recovery Trust Account and Real Estate Inspection Recovery Fund payments; or

    (D) a business entity licensed by the Commission has any unpaid or past due monetary obligations to the Commission, including administrative penalties and Real Estate Recovery Trust Account payments, that were incurred while the broker was the designated broker for the entity.

  (3) Regardless of the type of business entity, the designated broker must be a managing officer of the business entity.

  (4) The business entity may not act as a broker during any period in which it does not have a designated broker to act for it who meets the requirements of the Act.

  (5) To obtain or renew a license, or upon any change in the business entity's designated broker, the entity must provide to the Commission:

    (A) proof of the designated broker's current status as a corporate officer, an LLC manager, an LLC member with managing authority, or a general partner for that entity; and

    (B) if the designated broker does not own at least 10 percent of the business entity, proof that the business entity maintains errors and omissions insurance:

      (i) in at least the minimum coverage limits required by the Act; and

      (ii) that provides coverage for losses due to a violation of the Act or this Chapter.

  (6) A broker may not act as a designated broker at any time while the broker's license is inactive, expired, suspended, or revoked.


Source Note: The provisions of this §535.53 adopted to be effective January 1, 1976; amended to be effective August 29, 1979, 4 TexReg 2900; amended to be effective September 24, 1993, 18 TexReg 6215; amended to be effective April 14, 1998, 23 TexReg 3682; amended to be effective July 1, 1999, 24 TexReg 4825; amended to be effective January 1, 2004, 28 TexReg 9542; amended to be effective January 1, 2011, 35 TexReg 11677; amended to be effective November 1, 2011, 36 TexReg 7327; amended to be effective June 3, 2012, 37 TexReg 4052; amended to be effective March 2, 2015, 40 TexReg 928; amended to be effective January 1, 2016, 40 TexReg 8222; amended to beeffective September 7, 2016, 41 TexReg 6738; amended to be effective May 24, 2017, 42 TexReg 2724; amended to be effective August 28, 2017, 42 TexReg 4306; amended to be effective December 9, 2018, 43 TexReg 7898

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