RECO — Real Estate Council of Ontario

Reference summary for an Ontario realty knowledge base. General information, not legal advice. Fees, insurance limits, education hours, and penalty amounts change over time — verify anything load-bearing at reco.on.ca before relying on it.

What RECO is and does

The Real Estate Council of Ontario (RECO) is the regulator responsible for administering and enforcing the Trust in Real Estate Services Act, 2002 (TRESA) and its regulations on behalf of the Ontario government. It is a not-for-profit delegated administrative authority operating under an administrative agreement with the responsible provincial ministry; the province retains ownership of the legislation and oversight of RECO, while RECO handles day-to-day regulation.

RECO regulates the real estate professionals who trade in real estate in Ontario — on the order of 110,000+ registered brokers, salespersons, and brokerages — with the mandate of protecting the public interest and enhancing consumer confidence in the sector. Its core functions are:

• Registration — deciding who may trade in real estate, and administering renewals.
• Standards and education — setting continuing-education requirements and providing consumer information (including the mandatory RECO Information Guide).
• Complaints, inspections, and discipline — investigating conduct, inspecting brokerages, and enforcing TRESA and the Code of Ethics.
• Insurance — administering the mandatory professional-liability insurance program (errors & omissions, commission protection, and consumer deposit coverage).

Registration, renewal, and continuing education

Registration. No one may trade in real estate in Ontario unless registered with RECO in the appropriate class (brokerage, broker, or salesperson) or exempt. Registration requires prescribed pre-registration education, suitability/good-character screening, affiliation with a brokerage (for individuals), and enrollment in RECO's insurance program.

Renewal cycle. Registration is renewed on a recurring two-year cycle. Each registrant must renew before their registration expires; failing to renew (or to meet renewal conditions such as insurance and education) means the person may not continue to trade.

Continuing education (CE). Registrants with a CE requirement must complete continuing education during each two-year cycle. Based on RECO's current program, the cycle includes:

• Mandatory update courses — RECO releases a mandatory annual update course (typically in January) covering legislative changes, current standards, and best practices; registrants complete these each cycle.
• Elective courses — registrants also complete elective courses chosen from RECO's catalogue (topics such as advertising compliance, human rights, condominiums, home inspection, and mortgage financing).

Newly registered agents follow a distinct post-registration education stream in their first cycle before the ongoing CE requirements apply in later cycles. The exact number of required hours/courses and their split between mandatory and elective components can change — verify current at reco.on.ca/learners/continuing-education-ce.

The RECO Information Guide

The RECO Information Guide is a standardized consumer document that registrants are required to provide and explain before providing services to a client or assistance to a self-represented party. Key points:

• It is the RECO-mandated version — brokerages cannot substitute their own alternative document.
• The registrant must use best efforts to obtain a written acknowledgement that the Guide was provided, and retain the signed acknowledgement in the trade file.
• The obligation applies broadly — to residential and commercial trades and to lease clients.

Its purpose is to make sure consumers understand, up front, how representation works under TRESA (client vs. self-represented party, designated vs. multiple representation), what a registrant can and cannot do, and where to turn with concerns.

Complaints, inspections, and discipline

RECO investigates complaints about registered brokers, salespersons, and brokerages, and about persons who may be trading in real estate unlawfully (without registration).

Filing and assessment. Anyone — a consumer, another registrant, or the public — can submit a complaint through reco.on.ca. RECO assesses each complaint consistently and fairly, weighing the risk to the public and any prior history of the registrant.

Investigation outcomes. Depending on severity, RECO may:

• Require the registrant to complete additional education (at their own expense) where a knowledge gap is found;
• Issue a written warning or require corrective action by a deadline;
• Refer the matter to the discipline committee (a statutory tribunal); or
• Prosecute under the Provincial Offences Act for offences under the Act.

Inspections. RECO also conducts inspections of brokerages to check compliance with TRESA — including trust-account handling, record-keeping, and disclosure practices — as a proactive (not solely complaint-driven) tool.

Discipline committee. When a matter is referred, a panel of at least three members hears it; at least one panel member must be a public (non-industry) member with no past registrant ties. If the committee finds a registrant failed to comply with TRESA or the Code of Ethics, it may impose penalties such as:

• Fines — reported ceilings of up to $50,000 for an individual agent and up to $100,000 for a brokerage per the RECO enforcement materials;
• Required education;
• Conditions on registration; or
• Suspension or revocation of registration.

Following TRESA Phase 2 (December 1, 2023), the discipline committee's authority was expanded to address alleged breaches of the Act itself, not just the Code of Ethics.

Provincial Offences Act prosecution. For serious offences, RECO can prosecute in court, where an individual can face fines up to $50,000 and/or imprisonment up to two years, and a corporation fines up to $250,000 (per RECO's enforcement materials).

Appeals. The Registrar can propose to refuse, suspend, revoke, or attach conditions to a registration. Such proposals — and certain other decisions — are appealable to the Licence Appeal Tribunal (LAT), an independent tribunal that can uphold, vary, or substitute its own decision.

Limits on RECO's powers. RECO cannot order a refund, cancel a contract, or award damages or restitution to a consumer; those are matters for the courts. Its role is regulatory — protecting the public and disciplining registrants — not compensating individual losses (except through the insurance program below).

Penalty ceilings and process details can change — verify current at reco.on.ca/enforcement.

Insurance: consumer deposit protection and E&O

Participation in RECO's professional-liability insurance program is mandatory for registration — an uninsured broker or salesperson may not trade. The program provides three coverages:

1. Consumer Deposit Insurance. Protects consumers' deposits when working with a registered brokerage. It responds to brokerage theft, fraud, insolvency, or misappropriation of deposit funds. Reported coverage parameters (per RECO's consumer materials):

• Up to $200,000 per claim;
• Up to $4 million per event (aggregate across all claims arising from a single incident; if valid claims exceed the aggregate, payouts are pro-rated);
• Up to $25,000 for certain social-engineering fraud;
• No deductible, and provided to consumers at no cost.

On a valid claim, the insurer typically pays the lost deposit to the consumer's real estate lawyer to allow closing. It does not cover disputes over who owns a deposit, deposits paid to builders or their lawyers, social-engineering losses above the sub-limit, or ordinary agent negligence/errors (which fall under E&O).

2. Errors & Omissions (E&O) Insurance. Professional-liability coverage protecting registrants against claims arising from errors or omissions committed in the course of providing real estate services. It is carried by every registrant as a condition of registration and responds through civil claims processes.

3. Commission Protection Insurance. Protects a brokerage's earned commission in defined circumstances.

The insurance term runs on an annual cycle. Coverage amounts, sub-limits, and the annual insurance fee change from term to term — verify current at reco.on.ca/agents-and-brokerages/insurance and the consumer deposit insurance FAQ before quoting any figure.

Related legislation and regulations RECO administers

• TRESA — Trust in Real Estate Services Act, 2002 (S.O. 2002, c. 30, Sched. C), formerly REBBA.
• O. Reg. 365/22 — Code of Ethics (see the dedicated Code of Ethics reference file).
• O. Reg. 567/05 — General; O. Reg. 579/05 — Educational Requirements, Insurance, Records and Other Matters; O. Reg. 536/20 — Personal Real Estate Corporations; O. Reg. 367/22 — Discipline Committee.

Verify the current list and regulation contents at https://www.reco.on.ca/about/what-we-do/legislation-reco-administers and Ontario e-Laws.