Does your corporation, partnership or trust have an interest in your land?? Read on: The Land Owner Transparency Act (LOTA) came into force on November 30, 2020 and with it the Land Owner Transparency Registry (LOTR) was born. LOTR is a registry of information about individuals who are deemed to have an indirect interest in land.
Here’s what you need to know if you plan to acquire or you currently hold an interest in land through a corporation, partnership, or trust. LOTA requires that all “reporting bodies” with an “interest in land” disclose certain information about their “interest holders.” Reporting bodies are:
- relevant corporations – corporations and limited liability companies, other than certain exempt corporations such as government bodies, municipal corporations, statutory authorities, certain financial institutions, public companies and corporations wholly owned by Indigenous nations;
- trustees of relevant trusts – trustees, including under express trusts and bare trusts or similar relationships under the laws of other jurisdictions, subject to exceptions, including for special trusts such as charities, pension plans, mutual funds, REITs, estate trustees and bankruptcy trustees and exceptions to be prescribed by regulation; and
- partners of relevant partnerships – partners, including under general partnerships, limited partnerships, liability limited partnerships, professional partnerships and foreign partnerships, subject to exceptions to be prescribed by regulation.
An interest in land means includes more than simple ownership of land. It also includes:
- a life estate;
- lease for a term of more than 10 years (including leases with renewal terms resulting in a cumulative term of more than 10 years); or
- a right to occupy or acquire fee simple ownership of land under an agreement for sale upon payments of the purchase price over time.
Obligations of Reporting Body with Existing Interest in Land
Subject to a few exceptions, where a reporting body already holds an interest in land, it will be required to file a transparency report by November 30, 2021.
Obligations of Reporting Body Acquiring an Interest in Land
Where a reporting body acquires an interest in land, they must file a “transparency declaration” confirming whether the transferee is a reporting body. A reporting body must also confirm the type of reporting body it is and file a “transparency report” setting out information about itself and the interest holders.
Ongoing Disclosure Obligations
Reporting bodies are required to keep the information in the LOTR current.
- If there is a change in interest holders, the reporting body must file a new transparency report within two months unless the reporting body ceases to be the registered owner of the interest in land to which the transparency report relates.
- If a reporting body ceases to be a reporting body in respect of an interest in land, it must file a notice in the LOTR within two months.
Failure to comply with the requirements of LOTA will result in the LTSA refusing to register the acquisition of an interest in land and may result in significant fines. HSJ’s team would be pleased to assist you with navigating the requirements of LOTA. To find out more about how LOTA might impact you and what information is collected, please contact HSJ.