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Broker Commission Split Agreement for Canada

Broker Commission Split Agreement Template for Canada

A Canadian Broker Commission Split Agreement is a legally binding contract that establishes the financial relationship between a real estate brokerage firm and an individual broker or agent. Operating under Canadian federal and provincial real estate regulations, this agreement defines the commission distribution structure, responsibilities of both parties, and terms of their business relationship. It includes specific provisions compliant with provincial real estate laws, which may vary by jurisdiction, and addresses key aspects such as payment terms, performance expectations, and termination conditions while ensuring compliance with Canadian tax laws and professional standards.

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What is a Broker Commission Split Agreement?

The Broker Commission Split Agreement is a fundamental document in Canadian real estate operations, essential for establishing clear financial terms between brokerages and their affiliated brokers or agents. This agreement becomes necessary when a licensed real estate professional joins a brokerage firm, whether as a new agent or transferring from another brokerage. It details the percentage split of commissions earned from real estate transactions, outlines mutual obligations, and ensures compliance with provincial real estate regulations and federal tax laws. The agreement typically varies by province to accommodate different regulatory requirements and may include provisions for performance-based adjustments, additional services provided by the brokerage, and specific market conditions. This document serves as the cornerstone of the business relationship, providing clarity and legal protection for both parties while promoting transparency in financial arrangements.

What sections should be included in a Broker Commission Split Agreement?

1. Parties: Identification of the brokerage firm and the broker/agent, including license numbers and contact information

2. Background: Context of the agreement, including the brokerage's business nature and the broker's qualifications

3. Definitions: Key terms used throughout the agreement including 'Gross Commission', 'Split Rate', 'Closing Date', etc.

4. Term and Renewal: Duration of the agreement and conditions for renewal

5. Commission Structure: Basic commission split formula and calculation method

6. Payment Terms: Timing and method of commission payments, including any holdbacks or special conditions

7. Broker Responsibilities: Duties and obligations of the broker/agent under the agreement

8. Brokerage Responsibilities: Services and support provided by the brokerage firm

9. Compliance Requirements: Obligations to comply with real estate laws, regulations, and professional standards

10. Termination: Conditions and process for ending the agreement

11. Post-Termination Obligations: Handling of pending transactions and commission payments after termination

12. Confidentiality: Protection of confidential information and trade secrets

13. General Provisions: Standard clauses including governing law, amendments, and notices

What sections are optional to include in a Broker Commission Split Agreement?

1. Training and Support: Details of additional training and support services provided by the brokerage, used when the brokerage offers extensive support programs

2. Marketing Contribution: Terms for sharing marketing costs and resources, included when there's a specific marketing cost-sharing arrangement

3. Team Structure: Rules for operating as part of a team within the brokerage, used when the broker works with a team

4. Insurance Requirements: Specific insurance obligations beyond standard coverage, included when additional insurance is required

5. Technology Platform Usage: Terms for using brokerage's technology platforms, included when specific software or tools are provided

6. Non-Compete Clause: Restrictions on competitive activities, used when required by brokerage policy

7. Desk Fees and Office Expenses: Terms for sharing office expenses, included when applicable to the relationship

What schedules should be included in a Broker Commission Split Agreement?

1. Schedule A - Commission Split Rates: Detailed breakdown of commission split percentages, including any sliding scales or performance tiers

2. Schedule B - Fee Schedule: List of all applicable fees, including desk fees, technology fees, and administrative charges

3. Schedule C - Office Policies: Brokerage's standard operating procedures and policies

4. Schedule D - Marketing Guidelines: Standards for marketing and advertising activities

5. Appendix 1 - Required Forms: Templates and forms used in the course of business

6. Appendix 2 - Technology Systems: List of provided technology tools and access credentials

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Canada

Publisher

Ƶ

Document Type

Broker Agreement

Cost

Free to use
Relevant legal definitions








































Clauses



































Relevant Industries

Real Estate

Commercial Property

Residential Property

Industrial Property

Retail Property

Property Management

Property Development

Investment Property

Agricultural Property

Hospitality Property

Relevant Teams

Legal

Compliance

Real Estate Operations

Finance

Administration

Human Resources

Risk Management

Business Development

Broker Relations

Contract Management

Relevant Roles

Real Estate Broker

Real Estate Agent

Managing Broker

Brokerage Owner

Real Estate Sales Representative

Associate Broker

Broker of Record

Real Estate Manager

Compliance Officer

Legal Counsel

Finance Director

Operations Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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