N.Y. Real Property Law § 442: Splitting commissions

§ 442. Splitting commissions. 1. No real estate broker shall pay any

part of a fee, commission or other compensation received by the broker

to any person for any service, help or aid rendered in any place in

which this article is applicable, by such person to the broker in

buying, selling, exchanging, leasing, renting or negotiating a loan upon

any real estate including the resale of a condominium or cooperative

apartment unless such a person be a duly licensed real estate

salesperson regularly associated with such broker or a duly licensed

real estate broker or a person regularly engaged in the real estate

brokerage business in a state outside of New York; provided, however,

that notwithstanding any other provision of this section, it shall be

permissible for a real estate broker to pay any part of a fee,

commission, or other compensation received to an unlicensed corporation

or an unlicensed limited liability company if each of its shareholders

or members, respectively, is associated as an individual with the broker

as a duly licensed associate broker or salesperson.

2. Furthermore, notwithstanding any other provision of law, it shall

be permissible for a broker properly registered pursuant to the

provisions of article twenty-three-A of the general business law who

earns a commission on the original sale of a cooperative or homeowners

association interest in real estate, including condominium units to pay

any part of a fee, commission or other compensation received for

bringing about such sale to a person whose principal business is not the

sale or offering of cooperatives or homeowners association interests in

real property, including condominium units in this state but who is

either: (i) a real estate salesperson duly licensed under this article

who is regularly associated with such broker; (ii) a broker duly

licensed under this article; or a person regularly engaged in the real

estate brokerage business in a state outside of New York.

Except when permitted pursuant to the foregoing provisions of this

section no real estate broker shall pay or agree to pay any part of a

fee, commission, or other compensation received by the broker, or due,

or to become due to the broker to any person, firm or corporation who or

which is or is to be a party to the transaction in which such fee,

commission or other compensation shall be or become due to the broker;

provided, however, that nothing in this section shall prohibit a real

estate broker from offering any part of a fee, commission, or other

compensation received by the broker to the seller, buyer, landlord or

tenant who is buying, selling, exchanging, leasing, renting or

negotiating a loan upon any real estate including the resale of a

condominium or cooperative apartment. Such fee, commission, or other

compensation must not be made to the seller, buyer, landlord or tenant

for performing any activity requiring a license under this article.