A common misconception is that brokers need to register their compensation company with OREA. That’s not the case. All real estate businesses in Oregon must be valid businesses in Oregon [registered with the Sect. of State], but only companies performing professional real estate activities should register with OREA. The ORS 696.290 compensation LLC does not need to be registered with OREA, but it must be registered with the Sect. of State. If you haven’t registered it with the OREA, you can still use it for compensation. If you haven’t registered it with the Secretary, you shouldn’t use it as a business because it’s not considered a business yet.
- ORS 60.101 [chapter of law for corporations] and ORS 63.101 [chapter of law for limited liability companies] both have provisions entitled “registered name” that state that a foreign corporation or limited liability company has the ability to “register” a business name to conduct business in Oregon.
- ORS 60.027 and ORS 63.027 also state that when you file an application with the Secretary of State to form a corporation or LLC, the certificate of existence the Secretary issues you then means the corporation/LLC’s name is registered in Oregon. You have a “registered business” with a specific name that it has exclusive control over, as shown by your documents with the Secretary of State.
- ORS 696.026(9) [chapter of law on real estate licenses] states “all professional real estate activity conducted by the managing principal broker, licensed real estate property manager or real estate licensees associated with the managing principal broker or licensed real estate property manager must be conducted under an active registered business name.”
- Up in ORS 696.010(24), the term “registered business name” is defined as “a name registered with the Real Estate Agency under which the individual registering the name engages in professional real estate activity.
- ORS 696.026(2)(b) then does a bit of a legalese two-step and states that the real estate agency’s system for registration and renewal of business names [that is, business names registered with OREA, not with the Secretary of State] must ensure that the registered business name be the corporate name, business corporate name, cooperative name, limited partnership name, business trust name, reserved name, registered corporate name or assumed business name of active record with the Office of the Secretary of State.”
- ORS 696.290(4) allows a broker to collect compensation through a corporation, limited liability company, limited partnership, or other lawfully constituted business organization for the purpose of receiving compensation [expressly not to do professional real estate activity though].