Standard of Practice 3-4 of the Code of Ethics states that listing brokers must disclose if a different commission rate (also known as dual or variable rate commission) will be paid for offers coming from within the listing broker’s firm versus offers from other cooperating brokers. This disclosure is required even if a buyer’s agent doesn’t ask for such information.
However, disclosing exactly what the different commission rates are for in-house offers and offers from cooperating brokers is only required if the buyer’s agent asks. A buyer’s agent is then required to inform the buyer of the differential rate before she submits an offer so she can take it into account.
The listing broker does not need the seller’s approval to disclose the existence of a dual or variable rate commission agreement, or if the buyer’s agent asks, the rates themselves.