As part of the province’s ongoing attempts to combat money laundering in BC, the Land Owner Transparency Act (“LOTA”) was passed in May 2019.
LOTA came into force on November 30, 2020 and effects of this legislation are significant. Through it, BC is now home to Canada’s only Land Owner Transparency Registry (“LOTR”), a publicly accessible registry of information about every individual who is deemed to have an indirect interest in real property through a corporation, trust or partnership.
From now on, any time that an application is made to register an interest in land, the transferee (a person to whom an interest in land is transferred) is required to file a transparency declaration in addition to the usual transfer paperwork. Although LOTA includes some exclusions, they are few and far between (for example, treaty and reserve land; public corporations, strata corporations, and government; and shareholders in private corporations with less than 10% of the corporation’s voting shares).
The transparency declaration must state whether the transferee is a reporting body (generally speaking, this includes most corporations as well as persons who are trustee of a relevant trust or a partners of a relevant partnership). Where the transferee falls into one of these categories, it must also complete and file a transparency report setting out information about the reporting body and its interest holders (including a beneficial owner of a relevant trust, a corporate interest holder of a relevant corporation, or a partnership interest holder of a relevant partnership).
Importantly, LOTA will also require existing reporting bodies with an interest in land to file a transparency report by November 30, 2021. Further, each time the interest holders change, the reporting body must file an updated report.
The penalties for failing to comply with LOTA's filing requirements range from $50,000 - $100,000 for a corporation, $25,000 - $50,000 for an individual, or up to 15% of the assessed value of the property to which the transparency declaration or transparency report relates (whichever is greater).
The good news is that our real estate team is well versed in this recent change to the law, and we are ready to walk you through the new rules and their effect on you and your land. Call or email us today to find out more.
This article is intended for information purposes only and should not be taken as the provision of legal advice. Richard A. Cleveland is a lawyer whose practice focuses on family, real estate, wills and estates, and employment law. He is a partner with the law firm of Cleveland Doan LLP and can be reached at (604)536-5002 or firstname.lastname@example.org.