The NAEA told its members this week that it submitted a ‘full response’ to the Department for Business Innovation & Skills’ consultation on changing the Estate Agents Act.
The NAEA, which has been under fire for apparently leaving members in the dark earlier, said in its weekly email that ‘creating a new exemption from important consumer protection legislation is definitely the wrong direction of travel’.
The consultation closed on August 10 after very few agents had known it was going on, or had been told what the proposed changes would involve.
Vince Cable’s government department wants to amend the 1979 Act to allow non-traditional agents – online operators, for example, and supermarkets – to be able to operate in the sector outside the scope of the legislation. They would not, for example, have to belong to an Ombudsman scheme.
Estate agents as currently defined by the Act would still have to comply.
The NAEA told members this week: “Our position is that compliance with the EAA is not a burden, and that if a new exemption is introduced it could be exploited by unscrupulous internet agents based in the UK or overseas.
“All consumers must have access to an Ombudsman scheme, especially as a large proportion of them get no choice in whether they deal with a traditional agent or an internet agent.
“The public probably presume that all agents are subject to some form of positive mandatory licensing by the government. This underlines the confusion that would be caused if the EAA was altered in a way that leads to one level of protection for consumers when they deal with traditional agents, but a drastically reduced level of protection when they deal with internet agents.
“An important issue that BIS and other government departments need to ponder is if the proposal would lead the UK government to breach its own European and international anti-money laundering commitments. Breaching these commitments can be very politically embarrassing.
“We have suggested a different approach which is to bring lettings agents into the statutory definition, plus the possible introduction of the currently dormant parts of the EAA concerning insurance cover for client money and standards of competence.”
The NAEA also told members that it is fighting to have the Property Misdescriptions Act retained, alongside the Consumer Protection from Unfair Trading Regulations.
The NAEA said: “Although there is an argument that dual presence of the PMA and the new regulations risk double jeopardy of prosecution for agents, on balance our view is that PMA should be retained. The PMA is specific to property and provides certainty, whereas the new regulations are generic to all traders.”