Real Estate and Escrow Activities
Sharing compensation with or paying finder’s fee to unlicensed person prohibited
(1)(a) Except as provided in paragraph (b) of this subsection, a real estate licensee may not offer, promise, allow, give, pay or rebate, directly or indirectly, any part or share of the licensee’s compensation arising or accruing from any real estate transaction or pay a finder’s fee to any person who is not a real estate licensee licensed under ORS 696.022 (Licensing system for real estate brokers and property managers), including a nonlicensed individual described in ORS 696.030 (Exemptions).
(b)A principal real estate broker may pay a finder’s fee or a share of the real estate licensee’s compensation on a cooperative sale when the payment is made to a licensed real estate broker in another state or country, provided that:
(A)The state or country in which the nonresident real estate broker is licensed has a law permitting real estate brokers to cooperate with principal real estate brokers in this state; and
(B)The nonresident real estate broker does not conduct in this state any acts constituting professional real estate activity and for which compensation is paid. If a country does not license real estate brokers, the payee must be a citizen or resident of the country and represent that the payee is in the business of real estate brokerage in the other country.
(2)A real estate broker associated with a principal real estate broker may not accept compensation from any person other than the principal real estate broker with whom the real estate broker is associated at the time.
(3)A principal real estate broker may not make payment to the real estate broker of another principal real estate broker except through the principal real estate broker with whom the real estate broker is associated.
(4)Notwithstanding ORS 696.010 (Definitions) to 696.495 (Revolving fund), 696.600 (Definitions for ORS 696.392, 696.600 to 696.785 and 696.995) to 696.785 (Commissioner duties when illegal commingling of funds found) and 696.800 (Definitions) to 696.870 (Duties of real estate licensee under ORS 105.462 to 105.490, 696.301 and 696.870), a principal real estate broker or a real estate broker associated with a principal real estate broker may create a corporation, limited liability company, limited liability partnership or other lawfully constituted business organization for the purpose of receiving compensation. The real estate licensee may not conduct professional real estate activity under a business organization created pursuant to this subsection.
(5)Nothing in this section prevents payment of compensation earned by a real estate broker or principal real estate broker while licensed because of the real estate broker’s or principal real estate broker’s association with a different principal real estate broker or because of inactivation of the real estate broker’s or principal real estate broker’s license. The compensation may be paid directly to the real estate licensee by the principal real estate broker with whom the real estate licensee was associated at the time the professional real estate activity for which the compensation was earned was conducted.
(6)Nothing in subsection (1) of this section prohibits a principal real estate broker or licensed real estate property manager who has a property management agreement with the owner of a residential building or facility from authorizing the payment of a referral fee, rent credit or other compensation to an existing tenant of the owner or real estate licensee, or a former tenant if the former tenant resided in the building or facility within the previous six months, as compensation for referring new tenants to the real estate licensee.
(7)(a) Nothing in subsection (1) of this section prevents an Oregon principal real estate broker from sharing compensation on a cooperative nonresidential real estate transaction with a person who holds an active real estate license in another state or country, provided:
(A)Before the out-of-state real estate licensee performs any act in this state that constitutes professional real estate activity, the real estate licensee and the cooperating Oregon principal real estate broker agree in writing that the acts constituting professional real estate activity conducted in this state will be under the supervision and control of the cooperating Oregon principal real estate broker and will comply with all applicable Oregon laws;
(B)The cooperating Oregon principal real estate broker or a real estate broker associated with the principal real estate broker accompanies the out-of-state real estate licensee and the client during any property showings or negotiations conducted in this state; and
(C)All property showings and negotiations regarding nonresidential real estate located in this state are conducted under the supervision and control of the cooperating Oregon principal real estate broker.
(b)As used in this subsection, “nonresidential real estate” means real property that is improved or available for improvement by commercial structures or five or more residential dwelling units. [Amended by 1953 c.42 §2; 1961 c.670 §2; 1969 c.674 §16; 1975 c.746 §21; 1977 c.649 §40; 1981 c.617 §13; 1989 c.724 §9; 1997 c.307 §1; 1999 c.470 §1; 2001 c.300 §27; 2007 c.337 §5; 2009 c.324 §8; 2013 c.145 §3; 2017 c.234 §19]
Notes of Decisions
Washington real estate broker who supervised execution of listing agreement by Oregon sellers is deemed to have engaged in negotiations and cannot, therefore, qualify as cooperating broker under this section. Fields v. Macnab, 70 Or App 154, 688 P2d 409 (1984)
Atty. Gen. Opinions
Sales of subdivision lots by mobile home salespeople, (1975) Vol 37, p 865; sales or offers of interests in limited partnerships to invest in real estate, (1978) Vol 38, p 1971