The introduction of the Land Owner Transparency Act (the “LOTA”) caused quite the stir in the legal and real estate industries when it was introduced by the provincial government in November 2020. By now, the Act and its various filing requirements should have reached all corners of the province (but if this is the first you are hearing of it, please click here to learn whether you need to file a transparency report with the Land Owner Transparency Registry (the “Registry”) by November 30, 2022).
A crucial but seemingly overlooked component of LOTA is the filing requirements for leases. Leases are referred to in the definition of “interest in land” in LOTA:
“interest in land” means any of the following:…
(c)a right to occupy land under a lease that has a term of more than 10 years;
By reviewing the LOTA, the Land Owner Transparency Regulations, the policy guidance from the Registry and the provincial government, leases must have the following elements to trigger a potential filing obligation under LOTA:
- Must be in the name of a reporting body*;
- Must be registered on legal title, or being registered on title;
- Must be for a term longer than ten years (a lease for ten years or less is not included);
- Can include commercial leases, modification to commercial leases, and commercial subleases registered on legal title (collectively referred to as a “Lease” for the purposes of this article). Residential lease between individuals are not captured under LOTA.
Whether a LOTA filing requirement is triggered depends on whether the Lease is registered on legal title. There are three relevant scenarios:
- If a Lease is NOT registered on title, then there are no LOTA filing obligations. This is because without a Lease being registered on title, there is no interest in land;
- If a Lease was registered on title prior to November 30, 2020, and on November 30, 2020, there was more than ten years left on the term of the Lease, a transparency report is required to be filed with the Registry by November 30, 2022;
- If a Lease was registered on title after November 30, 2020, or is currently being registered on title, and is in the name of a reporting body, and is for more than ten years, a transparency declaration and a transparency report are required at the time of filing.
If you are involved in a reporting body which has a Lease registered on legal title, contact our Real Estate Practice Group leaders, Joel Hagyard or Pamela Lindsay, to ensure your obligations under the Land Owner Transparency Act are fulfilled.
*The Act defines a “reporting body” as a relevant corporation, a trustee of a relevant trust or a partner of a relevant partnership.
- Relevant corporation: All private corporations and limited liability corporations, unless exempt by the Act or by regulation.
- Relevant trust: All express (intentional) trusts (including bare trusts), unless exempted by the Act or by regulation.
- Relevant partnership: All partnerships, unless exempted by regulation.
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This article is intended to be an overview of the law and is for informational purposes only. Readers are cautioned that this article does not constitute legal or professional advice and should not be relied on as such. Rather, readers should obtain specific legal advice in relation to the issues they are facing.