Estate Agency Agreements: Forms 3, 4, 5 and 6

Forms 1 to 6 are the six prescribed forms in the Schedule to the Estate Agents Practice (General Duties and Hong Kong Residential Properties) Regulation (Cap. 511C), usually called the Practice Regulation. They appear in Part I questions and in nearly every Part II sale or letting case. Examiners test three things: which form fits which client, the deadline for signing it, and what happens to the agent’s commission if it is missing.

The six forms at a glance

Forms 1 and 2 are information forms, not agreements. The agent completes them and gives them to the client. Forms 3 to 6 are the estate agency agreements that create the appointment and set the commission. Memorise the pairs: 3 and 4 for sale (vendor, purchaser), 5 and 6 for leasing (landlord, tenant). Odd numbers are the owner’s side.

Forms 1 and 2 have their own guide: Property Information Form and Leasing Information Form.

When the agreement must be signed: section 6

Section 6 of the Practice Regulation sets the deadlines. They differ by side.

If the client is not legally represented, section 6 also requires the agent to explain the types of agency appointment and every term of the agreement, and to recommend that the client seek independent legal advice.

When no prescribed form is needed

• a car parking space on its own;
• leasing a unit that is not self-contained (for example, a room without its own cooking facilities and bathroom);
• a first sale of an undivided share in land by a developer, where section 7 applies instead.

A “self-contained unit” is an independent dwelling with separate cooking facilities and a bathroom, with or without a lavatory (Cap. 511C, section 2). The prescribed forms also only cover residential property in Hong Kong: Form 3 is void if the occupation permit does not allow domestic use (Form 3, clause 12).

Section 45: no agreement, no commission claim

Section 45 of the Estate Agents Ordinance (Cap. 511), in operation since 1 November 1999, is the reason the forms matter commercially. An agent has no right to sue for commission or outgoings unless:

• a prescribed-form estate agency agreement was entered into and properly executed; and
• the agent held an estate agent’s licence at the time.

In Easy Property Co Ltd v Hau King Kuen [2004] 1 HKLRD 155, the agent had signed the provisional agreement for sale and purchase with both parties but had no prescribed estate agency agreement. The tripartite provisional agreement was not enough, and the commission claim failed. A missing or late agreement is also a breach of section 6 that can lead to discipline.

What Forms 3 to 6 contain

Appointment and validity period

Clause 1 appoints the agent as an exclusive or non-exclusive agent and sets a validity period with start and expiry dates. The law sets no maximum period. Forms 4 and 6 carry a caution recommending that the validity period be not more than 3 months.

Exclusive vs non-exclusive agency

Under an exclusive agency, the agent is the only agent acting for the vendor or landlord. Forms 3 and 5 warn that the client may have to pay commission even if the property is not sold or let through that agent. If the vendor sells through another agent during the validity period, the exclusive agent can still claim the commission in Schedule 2 (Form 3, explanatory note 3). Practice Regulation section 8 adds that an agent who approaches a vendor already under another agent’s exclusive agency must warn the vendor that they may have to pay additional commission.

Single, dual or potentially dual agency

Interests and commission

• Interests in the property: any pecuniary or other beneficial interest of the signatory, a specified relative, a nominee, or the agency and its staff goes in the “Interests in Property” schedule. Interests arising later are disclosed in writing as soon as practicable.
• Commission: payable if a binding agreement for sale and purchase is made through the agent during the validity period. The parties tick whether it is due on signing or on completion.
• Deal falls through: no commission if completion fails without the client’s fault. Commission already paid is refunded not later than 5 working days from the scheduled completion date.
• Mutual cancellation: commission is still payable if the parties cancel by agreement, other than under a term of the sale agreement.
• Co-operating agents: the client does not pay agents your firm co-operates with.
• Form 4 extra: the purchaser also pays if their spouse, nominee, undisclosed principal or agent buys a listed property during the validity period, through the agent or otherwise.

The list price in Form 3 is for listing and advertising only. It does not authorise the agent to accept an offer for the vendor (Form 3, clause 3). Immediately after signing, the client must get the original or a copy of the signed agreement (Form 3 caution; Estate Agents Ordinance, sections 47 and 48).

Related Practice Circulars

• Circular No. 16-03 (CR), effective 1 Dec 2016: record the vendor’s name and identity document number in the estate agency agreement and check ownership with a land search.
• Circular No. 14-01 (CR): executing estate agency agreements by electronic means.
• Circular No. 24-01 (CR), effective 1 Nov 2024: each firm sets commission independently, and firms are encouraged to give clients a commission letter before the provisional agreement or tenancy agreement.

Worked example

Practise this topic with SQE questions or EAQE questions. Sources: Cap. 511C, Cap. 511, section 45, and the EAA’s prescribed forms page.