ExamPassBrokerage vs designated representation agreement in Ontario
Under a brokerage representation agreement, the brokerage and all of its brokers and salespersons provide services, including representation, to the client. Under a designated representation agreement, the brokerage still provides services, but it designates one or more of its brokers or salespersons to represent the client to the exclusion of the brokerage and everyone else there. A designated representative is the broker or salesperson named to do that (O. Reg. 567/05, s. 2 (1)).
In short: with brokerage representation, the whole firm is on your side; with designated representation, only the named person or people are. That one difference changes how confidential information is handled and when multiple representation is triggered, which is why the exam keeps testing it.
This guide compares the two agreements. For how designated representation differs from multiple representation, see designated representation vs multiple representation.
What is a designated representative?
A designated representative is a broker or salesperson whom the brokerage names, under a designated representation agreement, to represent a client. The regulation requires a written agreement of this kind to set out the name of each designated representative, the services they will provide, and the fact that the brokerage itself will not provide representation (O. Reg. 567/05, s. 13.4 (1)).
The client still has a relationship with the brokerage. Under the regulation's definition of "client", a person under a designated representation agreement is the brokerage's client for services but not representation, and the designated representative's client for services including representation (O. Reg. 567/05, s. 1 (1)).
Who represents the client under each agreement?
| Brokerage representation agreement | Designated representation agreement | |
|---|---|---|
| Who represents the client | The brokerage and all of its brokers and salespersons | Only the named designated representative(s) |
| The brokerage's role | Representative | Provides services, supervises, protects confidentiality, stays impartial |
| Other salespersons at the firm | Part of the client's representation | Excluded from representing the client |
| Written agreement must state | The services the brokerage will provide | Also: each designated representative's name, their services, that the brokerage will not represent, and the duties in ss. 22.0.4 and 22.0.5 |
| If the representative cannot continue | The brokerage still represents the client | The brokerage designates someone else, if the client agrees (s. 22.0.4 (d)) |
| Multiple representation triggered when | The brokerage represents more than one client in the same trade (s. 22) | The same designated representative represents more than one client in the same trade (s. 22.0.1) |
What happens to confidential information under each?
Every registrant owes clients confidentiality: no disclosure of a client's confidential information to a third party without the client's written consent, unless the law authorizes or requires it (Code of Ethics, O. Reg. 365/22, s. 12).
Designated representation adds an internal wall. The designated representative must not disclose a client's confidential information to any other broker or salesperson at the same brokerage, or to anyone else, unless the client authorizes it or the law requires it (O. Reg. 567/05, s. 22.0.5). The brokerage must protect each client's confidential information, including making sure its designated representatives keep that wall in place (s. 22.0.4 (a)).
Under brokerage representation, the whole brokerage is the representative, so there is no internal wall built into the model. Everyone at the firm represents the client, and the Code's confidentiality duty (s. 12) still bars disclosure to anyone outside the client relationship without written consent.
How is multiple representation triggered under each?
This is the heart of the comparison.
Brokerage representation. Because the brokerage itself represents the client, the brokerage is in multiple representation whenever it represents more than one client in the same trade, even if two different salespersons are doing the work. It may proceed only after disclosing to each client the fact of multiple representation and how its duties, services and remuneration arrangements would differ, and after each client consents in writing (s. 22 (1) and (2)). The brokerage and every broker and salesperson it employs must then treat those clients objectively and impartially (s. 22 (5)).
Designated representation. Multiple representation is triggered only if the same designated representative would represent more than one client in the same trade. The same disclosure and written consent rules apply, and that representative must treat the clients objectively and impartially (s. 22.0.1). Two different designated representatives at one brokerage, each acting for their own client, do not trigger s. 22.0.1.
Mixed: one of each. If the brokerage represents one client under a brokerage representation agreement and one of its salespersons represents another client in the same trade as a designated representative, s. 22.0.2 applies. The brokerage must disclose the arrangement and how duties, services and remuneration arrangements differ, and each client must consent in writing before they proceed. Everyone at the brokerage must treat both clients objectively and impartially.
Whichever model is used, if a brokerage provides services to both a seller and a buyer in the same trade, it must tell every other buyer who makes a written offer, as soon as possible after its buyer's written offer and before any offer is accepted (s. 22.0.3). That disclosure is not a request for consent. See competing offers under TRESA.
Scenario: two salespersons, one brokerage, one house
Bellwood Lane Realty in Guelph has two salespersons, Nadia Ferreira and Owen Achterberg. Nadia represents the seller, Grace Liu, of a semi on Arkell Road. Owen represents a buyer, Darnell Price, who wants to make an offer.
Version A: both on brokerage representation agreements. Bellwood Lane itself represents Grace and Darnell, so the brokerage is about to represent two clients in the same trade. Before anything proceeds, Bellwood Lane must give both clients the s. 22 disclosure and get each one's written consent. If either refuses, the brokerage cannot represent both in this trade. Once both consent, Nadia, Owen and everyone else at Bellwood Lane must treat Grace and Darnell objectively and impartially.
Version B: both on designated representation agreements. Nadia is Grace's designated representative and Owen is Darnell's. Different representatives, so s. 22.0.1 is not triggered and each client keeps full representation from their own salesperson. Nadia cannot share Grace's bottom line with Owen (s. 22.0.5), and the brokerage must treat both clients impartially and supervise both salespersons (s. 22.0.4).
Version C: Owen falls ill. The brokerage proposes that Nadia also act for Darnell. Now one designated representative would represent two clients in the same trade, so s. 22.0.1 applies: disclosure, written consent from both, and impartial treatment. The better route may be for the brokerage to designate another salesperson for Darnell, which it can do if Darnell agrees (s. 22.0.4 (d)).
In all three versions, if another buyer submits a written offer, Bellwood Lane must tell that buyer it serves both Grace and Darnell in this trade (s. 22.0.3).
Is there a buyer or tenant designated representation agreement?
Yes. The definitions are not limited to sellers. TRESA defines "real estate" to include leasehold interests, and the regulation defines "buy" as acquiring or seeking to acquire an interest in real estate. So a buyer, or a tenant seeking a lease, can sign either a brokerage representation agreement or a designated representation agreement, and the same multiple representation rules apply.
Frequently asked questions
What is the difference between designated representation and brokerage representation? Under brokerage representation, the brokerage and all its brokers and salespersons represent the client. Under designated representation, only the named designated representative does, and the brokerage provides services without representation.
What does "designated representative" mean? A broker or salesperson whom the brokerage names under a designated representation agreement to represent a client (O. Reg. 567/05, s. 2 (1)).
Is it multiple representation if two salespersons at the same brokerage act for the buyer and the seller? Under brokerage representation agreements, yes, because the brokerage represents both. Under designated representation agreements with different designated representatives, no, though the brokerage must still be impartial and protect each client's confidential information.
Do other buyers have to be told? Yes. If a brokerage serves both a seller and a buyer in the same trade, it must disclose that to every other buyer who makes a written offer, before any offer is accepted.
How does ExamPass help you practice representation?
ExamPass gives you hundreds of original scenario questions on representation agreements, multiple representation and disclosures, with every option explained, so you learn to ask "who represents whom?" before you answer. The Study notes, Mock Exam, Drill Wrong Answers and AI Tutor help you find the traps you still fall for. Try free Course 2 practice questions or free Simulation 1 practice questions, and read the Code of Ethics explained for the duties behind these rules. See courses and pricing
This guide is a study aid and a plain-language summary, not legal advice. The current text of TRESA and its regulations is always the final authority. ExamPass is an independent study aid. It is not affiliated with or endorsed by RECO, Meazure Learning, Humber Polytechnic, Career College Group, Fleming College, Algonquin College, or any other education provider. Provider and exam names are used only to identify the courses students are preparing for.