The Land Owner Transparency Act requires any company, trust, or partnership that owns property in British Columbia to make a new filing with the Land Title Office by no later than November 30, 2021. Failure to make this filing can result in a penalty equal to the greater of $50,000.00 or 15% of the assessed value of the real estate.
Please read below for more information on these new requirements, or, if you would like us to assist you with this process then simply click here to complete our short intake questionnaire. One of our lawyers will then reach out to you regarding next steps after reviewing your questionnaire.
As we are receiving a great number of requests for assistance with this matter and the deadline is fast approaching, we would encourage you to complete the questionnaire as soon as possible if you would like our assistance with this filing. We unfortunately cannot guarantee that we will be able to assist with filing requests received after November 15, 2021, and late requests may be subject to additional rush-fees.
Last year, the Government of British Columbia enacted the Land Owner Transparency Act (“LOTA”) with the intention of combating money-laundering in the real estate industry and providing increased visibility as to the ultimate ownership or control of real estate in British Columbia.
The LOTA now requires that every “Reporting Body” that already holds or is receiving an “Interest in Land” files a “Transparency Report” which lists all of its “Interest Holders” by no later than November 30, 2021. In essence, this means that every company, partnership, trust, society, or other corporate entity which owns real estate in British Columbia must engage a legal professional to make an official filing with the Land Title Office setting out the underlying owners or control persons behind the respective entity.
A “Reporting Body” is, in short, a corporation, trustee, or partnership that already holds or is receiving an Interest In Land. Please see the Key Terms section below for a more fulsome definition of a Reporting Body.
A “Transparency Report” is, in short, a lengthy disclosure document which must be file with the Land Title Office by a legal professional which discloses certain information on the owners or control persons behind the respective entity. Please see the Filings Requirements section below for a more fulsome description of the information that needs to be filed.
An “Interest Holder” is, in short, defined as including, amongst other things, a shareholder who owns more than 10% of the voting (or overall) shares in a company, a beneficiary of a trust, and a partner in a partnership. Please see the Key Terms section below for a more fulsome definition of a Interest Holder.
The penalties for failing to comply with the new requirements are significant. Under LOTA, failure to file or incorrectly filing a Transparency Report could result in fines up to the greater of 15% of the assessed value of the real estate property, and $25,000 for individuals and $50,000 for corporations, trusts and partnerships. Additional penalties can be imposed on parties such as directors and officers who fail to file, or incorrectly file, a Transparency Report.
For example, ABC Ltd. owns a property that has an assessed value of $1,000,000. Should ABC Ltd. fail to file the Transparency Report, it could be subject to a fine in the amount of $150,000.
Any Reporting Body that holds an Interest in Land is required to disclose certain information about its Interest Holders by filing a Transparency Report. A sample of the Transparency Report can be accessed here.
The Transparency Report will contain a significant amount of information about the Reporting Body and it’s Interest Holders, which can be broken down into primary and secondary information. The primary information will be made public and includes:
In addition, the Reporting Body will also need to disclose additional secondary information that is of a more sensitive nature and which will not be available to the wider public. The secondary information includes tax and corporate registration numbers, individual’s date of birth, last known address, social insurance number and individual tax numbers.
It is important to note that, except in a few limited situations, the Transparency Report must be filed online and must been done by a legal professional who has access to the filing portal. This is not something that you can complete yourself. In order to ensure that your Transparency Report is filed by the deadline, we would urge you to take action promptly in order to avoid the last minute rush.
Owners of real estate property in British Columbia will need to be familiar with some of the key terms summarized below in order to assess whether they have obligations under LOTA and are required to file a Transparency Report by November 30, 2021.
If you need assistance in order to determine whether you are required to file a Transparency Report, the team at M&C is here to help so please contact us and one of our lawyers will be happy to assist.
Under LOTA, a Reporting Body can be one of the following:
Under LOTA, a Interest in Land means:
A Reporting Body that has an Interest in Land may be required to file a Transparency Report.
Under LOTA, an Interest Holder means any individual who:
An Interest Holder of a Reporting Body that has an Interest in Land may be required to file a Transparency Report.
As part of the Province’s plan to increase visibility as to the ultimate ownership and control of real estate in British Columbia, the information contained in the Transparency Report will be used to update the searchable Land Owner Transparency Registry (the “Registry”). As mentioned above, the information that is disclosed will be available in varying degrees. The primary information will be available to the general public while the secondary information will only be available to select governmental authorities such as Canada Revenue Agency, the BC Securities Commission, and law enforcement.
Yes – The corporation must file a Transparency Report by November 30, 2021 disclosing your information. Click here to complete our questionnaire if this applies to you and you would like our assistance.
Yes – The corporation must file separate Transparency Reports by November 30, 2021 disclosing information about all of the Interest Holders of the corporation for each and every property that the corporation owns. Click here to complete our questionnaire if this applies to you and you would like our assistance.
Yes – The corporation must file a Transparency Report by November 30, 2021 disclosing information about all of the Interest Holders of the corporation. Click here to complete our questionnaire if this applies to you and you would like our assistance.
No – You would not have to file a Transparency Report as you are not a Reporting Body.
While in some situations it will be easy to identify when a Transparency Report will need to be filed, there are going to be other situations where there are complicated ownership structures or where it is difficult to identify the beneficial owners or Interest Holders.
If you are unsure whether LOTA applies to your situation or are unsure of your filing obligations, the team at M&C is committed to guiding our clients and colleagues through these important changes. Simply start by clicking here to complete our questionnaire with the requested information. After review, one of our lawyers will reach out to you and discuss with next steps.
In the meantime, if you have any questions, please reach out to the lawyer(s) that you primarily work with at M&C, or alternatively, contact Mustafa Mohamedali on 604-639-6342 or by email at firstname.lastname@example.org.