Arkansas Code of 1987 (2023) › Title 17 - PROFESSIONS, OCCUPATIONS, AND BUSINESSES (§§ 17-1-101 — 17-107-311) › Subtitle 2 - NONMEDICAL PROFESSIONS (§§ 17-10-101 — 17-56-202) › Chapter 42 - REAL ESTATE LICENSE LAW (§§ 17-42-101 — 17-42-702) › Subchapter 1 - REAL ESTATE LICENSE LAW - GENERAL PROVISIONS (§§ 17-42-101 — 17-42-110) › Section 17-42-104 - Exemptions - Definition

(a)
This chapter does not apply to:
(1)
A person not licensed under this chapter who performs any of the acts described in §
17-42-103(10)
as:
(A)
An owner of an individual freehold or leasehold interest in real estate;
(B)
In the case of a corporation, limited liability company, limited partnership or other entity recognized by law holding a freehold or leasehold interest in the real estate under subdivision (a)(1)(A) of this section, a member, manager, partner, or officer who has authority to make management decisions affecting the overall policy of the entity regarding real estate activities involving only the interest of the owner;
(C)
An individual attempting to acquire for his or her own use a freehold or leasehold interest in real estate; or
(D)
In the case of a corporation, limited liability company, limited partnership, or other entity recognized by law intending to acquire a freehold or leasehold interest in real estate under subdivision (a)(1)(C) of this section, a member, manager, partner, or officer who has authority to make management decisions affecting the overall policy of the entity;
(2)
An attorney in fact under a duly executed and recorded power of attorney from the owner or lessor authorizing the final consummation by performance of any contract for the sale, lease, or exchange of real estate, provided that the attorney in fact does not receive or have an expectation of receiving a fee, commission, or other consideration, directly or indirectly, for performing the act;
(3)
An attorney at law in the performance of his or her duties as an attorney at law;
(4)
A person acting as a receiver, trustee in bankruptcy, administrator, executor, or guardian, or while acting under a court order or under the authority of a will or of a trust instrument;
(5)
A person acting as a resident manager when the resident manager resides on the premises and is engaged in the leasing of real property in connection with his or her employment;
(6)
A person employed only at a salaried or hourly rate to engage in the leasing of real property for or on behalf of a licensed principal broker, the real estate firm of a licensed principal broker, or an owner of real estate, if the person:
(A)
Does not engage in or offer to perform any practice, act, or operation set forth in §
17-42-103(10)
other than receiving a security deposit or payment as permitted by subdivision (a)(6)(B)(iii) of this section; and
(B)
Performs only one (1) or more of the following functions:
(i)
Delivering a lease application, lease, or an amendment to a lease application or lease to any person;
(ii)
Receiving a lease application, lease, or an amendment to a lease application for delivery to the principal broker, real estate firm, or owner;
(iii)
Receiving a security deposit, rental payment, or any related payment for delivery to and made payable to the principal broker, real estate firm, or owner;
(iv)
Acting under the direct written instructions of the principal broker, real estate firm, or owner:
(a)
Showing a rental unit to any person; or
(b)
Assisting in the execution of a preprinted lease or rental agreement containing terms established by the principal broker, real estate firm, or owner; or
(v)
Conveying information prepared by the principal broker, real estate firm, or owner about a lease application, lease, the status of a security deposit, or the payment of rent to or from any person;
(7)
An officer or employee of a federal agency or state government, or any political subdivision, in the performance or conduct of his or her official duties;
(8)
A multiple listing service wholly owned by a nonprofit organization or association of real estate licensees;
(9)
An officer of a corporation, a member or manager of a limited liability company, a partner of a partnership, or the equivalent of an officer of another form of business entity acting with respect to real property owned or leased by the entity or an affiliated entity under common ownership or in connection with the proposed purchase, sale, rental, or leasing of real property by the entity or affiliate if the acts are not performed by the officer, member, or partner for or in expectation of a commission or other compensation resulting solely from a successful transaction;
(10)
A person employed primarily at a salaried or hourly rate by a corporation, limited liability company, partnership, or other business entity acting with respect to real property owned or leased by the entity or an affiliated entity under common ownership or in connection with the proposed purchase, sale, rental, or leasing of real property by the entity or affiliate if the:
(A)
Acts are not performed by the employee for or in expectation of a commission or other compensation resulting solely from a successful transaction;
(B)
Primary business activity of both the entity and affiliated entity is not ownership or acquisition of real estate; and
(C)
Employee is not providing real estate services to or on behalf of more than one (1) entity not affiliated by common ownership; or
(11)
(A)
A person employed by an Arkansas-licensed residential construction company if:
(i)
The employee provides a written disclosure to any purchaser involved in the possible or actual sale of newly constructed and never-occupied residential real estate:
(a)
Stating that the:
(1)
Employee is acting exclusively on behalf of his or her employer who is the Arkansas-licensed residential construction company; and
(2)
Purchaser has a right to be represented by his or her own licensed real estate agent or legal counsel; and
(b)
The employer shall maintain the written disclosure for seven (7) years after delivery;
(ii)
The primary business activity of the Arkansas-licensed residential construction company is not an activity described under §
17-42-103(10)
;
(iii)
The employee is not providing real estate services to or on behalf of more than one (1) entity not wholly owned by the Arkansas-licensed residential construction company; and
(iv)
The Arkansas-licensed residential construction company employs a principal broker, as defined under §
17-42-103(10)
, who shall be responsible for the conduct of any persons identified in this subdivision (a)(11) in the same manner as if such person was a licensee, as defined under §
17-42-103(8)
.
(B)
A person or Arkansas-licensed residential construction company asserting or utilizing the exemption under subdivision (a)(11)(A) of this section shall have the burden of proving a person is an employee, or is employed by the Arkansas-licensed residential construction company as that term is used in state and federal income tax, Social Security, and for other purposes.
(C)
As used in this section, "Arkansas-licensed residential construction company" means:
(i)
A construction company that:
(a)
Owns or leases newly constructed and never-occupied single family residential real estate;
(b)
Has the sole business of developing, constructing, or selling newly constructed and never-occupied single family residential real estate; and
(c)
Is licensed in Arkansas; or
(ii)
An entity wholly owned by the Arkansas-licensed residential construction company in connection with the proposed purchase or sale of single family residential real estate that:
(a)
Is wholly owned by the Arkansas-licensed residential construction company or entity;
(b)
Has the sole business of developing, constructing, or selling newly constructed and never-occupied single family residential real estate; and
(c)
Is licensed in Arkansas.
(b)
Any real estate broker licensed by the Arkansas Real Estate Commission on or before January 1, 1985, who is engaged in the sale of real estate by auction only is authorized to employ real estate salespersons to work under the license of the broker even though the broker is employed in a non-real estate-related field and is only a part-time broker.
(c)
A person or entity shall not under any circumstance qualify for an exemption under this section if the person or entity:
(1)
Obtains an equitable interest in real estate with knowledge that the interest was obtained on behalf of a person or entity that intends to gain an interest in the real estate other than that of ownership; or
(2)
Strategically circumvents the requirement for licensure thereby eliminating remedies available to consumers through the commission.
(d)
The commission may waive certain requirements under §
17-42-101
et seq., for a principal broker employed by an Arkansas-licensed residential construction company under this section.
Amended by Act 2023, No. 31,§ 2, eff. 8/1/2023.
Amended by Act 2023, No. 31,§ 1, eff. 8/1/2023.
Amended by Act 2017, No. 890,§ 3, eff. 8/1/2017.
Amended by Act 2017, No. 890,§ 2, eff. 8/1/2017.
Amended by Act 2015, No. 278,§ 3, eff. 7/22/2015.
Amended by Act 2015, No. 278,§ 2, eff. 7/22/2015.
Acts 1993, No. 690, § 4; 2007, No. 263, § 2; 2011, No. 865, § 2; 2011, No. 883, § 1.