As of November 30th, 2020, the Land Owner Transparency Act (“LOTA”) is in effect and the new Land Owner Transparency Registry (the “LOTR”) is on line.
LOTA requires that every purchaser of real property in BC sign a transparency declaration for filing in the LOTR. In order to complete the declaration, we need to determine if the purchaser is a reporting body. Reporting bodies include certain types of corporations, trustees of certain types of trusts and partners of certain types of partnerships. If you are an individual buying property for yourself and not for another person or as trustee of a trust or as a partner of a partnership, you simply declare in the declaration that you are not a reporting body.
If you are a reporting body, LOTA requires that you sign a transparency report for filing in the LOTR in addition to the transparency declaration.
For example, a privately held corporation is a reporting body. If the corporation purchases real property in BC, it will sign a declaration confirming it is a reporting body and a report disclosing the following additional information:
We also need to determine who the reporting body’s interest holders are. Generally, the interest holders will be the beneficial owners of the purchaser. In order to determine this, you need to examine the company’s Central Securities Register and Transparency Register. If any shareholder is another company, you then need to examine that company’s Central Securities Register and Transparency Register as well. If there is any agreement between the shareholders as to who has rights in regards to the election, appointment, or removal of directors, you need to review copies of such agreements as well. You also need to determine if anyone has the ability to exercise direct and significant influence over any interest holder.
Once you determine who the interest holders are, the following information is needed from each interest holder in order to complete the report for filing:
It is important to note that only portions of the information included in the report are accessible by the public. The individuals’ birthdates, social insurance number/tax numbers are not publicly accessible, and only part of the individuals’ principal residence address is made public. For individuals living in Canada, their city and province are listed in the LOTR; for individuals living outside of Canada, the public registry discloses their city and country of primary residence. Taxing authorities and law enforcement entities may access the complete information set out in the transparency report.
If publicly disclosing information about an individual in the LOTR will pose a risk to the health or safety of the individual or a member of their household, individuals may apply to omit that information from the LOTR. The LOTR administrator will then decide whether to omit the information from the LOTR.
In addition to the requirements for purchases completing on or after November 30th, 2020, all reporting bodies who already own real property in BC will have to file the required documents within one year.
The Province will be enforcing compliance with these requirements. Failure to file a report, when required, or providing false or misleading information in a transparency report may be subject to a fine of not more than the greater of:
There is a minor fee for filing the additional documents ($5 for a declaration and $35 for a report). As noted above, the declaration will always have to be filed in the LOTR, but the report only needs to be filed if the purchaser is a reporting body.
If you have any questions about whether or not you are required to file a transparency report in the new LOTR or you know that you need to file a transparency report and would like us to assist in completing and filing that report – please call any one of our solicitors, Grant A. Zimmerman, Roberta J. Stewart, Robin H. Craig, Jordan F. Thorne, and Chelsea E. Dunk.