Disclosure of Interest in Trade

A Disclosure of Interest in Trade is a required written disclosure under the BCFSA Rules (specifically Rule 5-9 under the Real Estate Services Act) that a licensee must provide when they, or a related party such as a spouse or business associate, have a direct or indirect interest in a real estate transaction they are facilitating. The disclosure must be made to all parties to the trade before the transaction is entered into. Its purpose is to ensure full transparency when a licensee's personal interests may conflict with their professional duties.

Under BCFSA Rule 5-9 of the Real Estate Services Act Rules, the disclosure must be made in writing before any agreement is entered into — meaning before an offer is accepted or a contract is signed. A licensee cannot complete the transaction first and disclose afterward. Timely disclosure is a fundamental compliance requirement, and failure to disclose in advance is considered a breach of the licensee's professional obligations under RESA.

Under the Real Estate Services Act and its Rules, a related party can include a licensee's spouse or partner, a corporation in which the licensee holds a significant interest, a business associate, or another entity in which the licensee has a beneficial interest. Because the definition is intended to capture situations where the licensee's objectivity could be compromised, licensees should consult current BCFSA guidance to confirm whether a specific relationship triggers the disclosure requirement.

Yes. When a licensed REALTOR® in British Columbia sells a property in which they have a personal ownership interest, Rule 5-9 under the Real Estate Services Act Rules requires them to disclose that interest in writing to all parties before any agreement is entered into. This applies regardless of whether the licensee is also acting as their own agent or is represented by another licensee. The requirement exists precisely because the licensee's personal financial interest could affect their conduct in the trade.

The Real Estate Services Act Rules require the disclosure to be in writing, but BCFSA does not prescribe a single mandatory form exclusively for this purpose; however, licensees are expected to document the disclosure clearly and retain a copy as part of their record-keeping obligations under RESA. Many brokerages use a standardized disclosure document to ensure all material details are captured. Licensees should follow their managing broker's procedures and consult current BCFSA practice guidance to ensure their disclosure format meets regulatory expectations.

Failure to provide a Disclosure of Interest in Trade is a breach of the Real Estate Services Act Rules and can constitute professional misconduct or conduct unbecoming a licensee under RESA. The British Columbia Financial Services Authority (BCFSA) has the authority to investigate complaints and impose sanctions, which may include fines, licence suspension, or licence cancellation. In serious cases, the transaction itself may be subject to legal challenge by the affected party.

Yes. Under the Real Estate Services Act Rules, the disclosure obligation extends to situations where a related party — including a corporation in which the licensee holds a material interest — is the party acquiring or disposing of the property. The intent of Rule 5-9 is to capture indirect interests, not just direct personal ownership, so a corporate structure does not exempt the licensee from the disclosure requirement.

Yes. The requirement under BCFSA Rule 5-9 of the Real Estate Services Act Rules applies to any trade in real estate — whether the licensee (or a related party) is the buyer acquiring property or the seller disposing of it. A licensee who lists their own property for sale, or facilitates the purchase of a property for themselves or a related party, must provide the written disclosure in both scenarios.

These are two distinct and separate disclosure obligations under the Real Estate Services Act Rules. Agency or representation disclosure relates to the nature of the licensee–client relationship and is governed by other provisions of the RESA Rules, while Disclosure of Interest in Trade specifically addresses a licensee's personal or related-party financial interest in the property being traded. Both disclosures may be required in the same transaction, but they serve different regulatory purposes and must each be completed independently.

Yes, if the licensee holds a beneficial or legal ownership interest in the inherited property — which they would upon distribution under the Wills, Estates and Succession Act (WESA) — and they are involved as a licensee in the trade of that property, the disclosure obligation under BCFSA Rule 5-9 of the Real Estate Services Act Rules applies. The manner in which the interest was acquired (purchase, gift, or inheritance) does not affect the requirement to disclose the interest in writing before any agreement is entered into.