Overview of the Land Owner Transparency Act (British Columbia)
In December 2017, the Canadian federal government committed to enacting legislation facilitating the disclosure of beneficial ownership of land as part of a global initiative to regulate fraud.
In step with this federal initiative, British Columbia has introduced provincial legislation requiring the disclosure of beneficial interests in land under the newly enacted Land Owner Transparency Act (“the LOTA”), which became law on November 30, 2020.
B. How Does LOTA Work
The LOTA requires most companies, trusts and partnerships (collectively termed “reporting bodies”) to register the beneficial ownership of any land registered in that reporting body’s name. Each reporting body must complete a Transparency Declaration and a Transparency Report. Reporting bodies which are currently the registered owners of land must file the Report by November 30, 2021.
As of November 30, 2020, all new transfers of land registered in British Columbia require the completion and filing of a Transparency Declaration and a Transparency Report by the acquiring party.
C. Description of the Transparency Declaration and Transparency Report
The Transparency Declaration (“the Declaration”) is a simple form in which the reporting body is identified (mainly by name and address).
The Transparency Report (“the Report”) seeks more detailed information than the Declaration and requires the disclosure of the following:
- identification information for the registered owner of the land
- for a corporation or partnership, this includes the entity’s name, registered office address, any head office address, jurisdiction where the entity is incorporated and if continued or transferred to another jurisdiction, that jurisdiction, as well as a list of its shareholders;
- for an individual, this includes a full name, whether a Canadian citizen or permanent resident, every country or state of which the individual is a citizen (if not a Canadian citizen or permanent resident), city and province where principal residence is located whether inside or outside of Canada; and
- any ‘prescribed’ information (none at present);
- information with respect to the owner of the beneficial interest in the land
- date of birth;
- last known address;
- social insurance number, if any;
- CRA tax number, if any;
- whether resident in Canada for the purposes of the Income Tax Act (Canada);
- date individual became or ceased to be an interest holder;
- description of how individual is an interest holder; and
- any ‘prescribed’ information (none at present).
The Report must be signed and certified as correct and complete by an individual with knowledge and authority on behalf of the transferee or reporting body. Such individual would be any of:
- a trustee of a relevant trust;
- a director of a relevant company; or
- a partner of a relevant partnership.
Additional reporting requirements for trusts
It should be noted that where a trust is a reporting body, information about the settlor of the trust must also be provided. There is also an ongoing obligation on the trustee to investigate any possible incapacity of a settlor or interest holder. Where the trustee ‘becomes aware’ of such incapacity, reasonable steps must be taken to establish whether a determination of incapacity has been made by the court, a health authority designate or ‘prescribed person’ in respect of the interest holder, the Report must also include this information.
D. Access to Information
The Land Ownership Transparency Registry (“the LOTR”) is held by the BC Land Titles Office, and may be searched by ministry officials, tax authorities, law enforcement agencies and ‘regulators’ (including the British Columbia Securities Commission, the Financial Institutions Commission, the Financial Transactions and Reports Analysis Centre of Canada, the Law Society of British Columbia and prescribed public officers, corporations, agencies or other entities ‘whose authority to regulate is based on a law of British Columbia or Canada’).
Members of the public may only access the identification information of reporting bodies that are, at the time of the search, registered as owners of legal and beneficial interests in land.
The LOTA permits the owner of a beneficial interest to apply to have some identification information omitted or obscured from the LOTR in instances where public access “could reasonably be expected to threaten the safety or mental or physical health of the individual or a member of the individual’s household”.
E. Compliance and Enforcement
An individual who fails to file a Transparency Report, or provides false or misleading information in a Transparency Declaration or a Transparency Report, is liable to a fine of not more than the greater of:
- $50,000 for a corporation, or $25,000 for an individual; or
- 15% of the assessed value of the property to which the Declaration or Report relates.
Persons may be liable to a fine of up to $100,000 for corporations and $50,000 for individual for other offences under the LOTA, such as failure by the owner of a beneficial interest in land to give information to a reporting body.