Comments On House Bill No. 5936, Proposed Restrictions On Competition From Non-Attorneys In Real Estate Closing Activities

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U.S. Department of Justice Seal
DEPARTMENT OF JUSTICE
Antitrust Division
R. HEWITT PATE
Assistant Attorney General


 
Main Justice Building
950 Pennsylvania Avenue, N.W.
Washington, D.C. 20530-0001
(202) 514-2401 / (202) 616-2645 (fax)
E-mail: antitrust@usdoj.gov
Web site: http://www.usdoj.gov/atr

June 30, 2003

The Honorable William V. Irons
President of the Senate
State Senate
Providence, Rhode Island 02903

The Honorable Joseph A. Montalbano
Majority Leader of the Senate
Majority Leader's Office
State Senate
Providence, Rhode Island 02903

The Honorable Dennis L. Algiere
Minority Leader of the Senate
Minority Leader's Office
State Senate
Providence, Rhode Island 02903

Members of the Senate Commerce, Housing,
and Municipal Government Committee
c/o The Honorable John A. Celona, Chairperson
State Senate
Providence, Rhode Island 02903

Members of the Senate Judiciary Committtee
c/o The Honorable Michael J. McCaffrey, Chairperson
State Senate
Providence, Rhode Island 02903

Re: House Bill No. 5936, Proposed Restrictions on Competition
From Non-Attorneys In Real Estate Closing Activities

Dear Mr. President and Members of the Senate:

We understand that the Rhode Island House of Representatives recently passed a bill that would amend the definition of "practice of law" to require lawyers to represent buyers in virtually all aspects of the real estate closing process. House Bill No. 5936, entitled, "An Act Relating To Criminal Offenses - Law Practice," was referred to the Senate Commerce, Housing, and Municipal Government Committee June 26, 2003. It is presently scheduled to be heard on Tuesday, July 1, 2003.

This bill is very similar to House Bill No. 7462, considered by the House of Representatives last year. The Department of Justice and the Federal Trade Commission urged the House to reject that bill because it would have restrained competition between lawyers and nonlawyers for real estate closing business, likely resulting in increased costs for Rhode Island consumers. The current bill raises many of the same concerns as House Bill No. 7462 did. Accordingly, we urge the General Assembly to reject the current legislation for the reasons stated in our March 29, 2002 letter.(1) A copy of our 2002 letter is attached.

  Sincerely yours,

            /s/
R. Hewitt Pate
Assistant Attorney General
United States Department of Justice
Antitrust Division


1 The bill primarily differs from the old bill in one respect. The new bill will allow realtors to answer questions about purchase and sale agreements and other issues that the old bill would have forbidden. This change does not diminish our concerns about the potential anticompetitive impact of the bill and we urge its rejection.

Updated June 25, 2015