BC’s New Database for Beneficial Ownership of Real Estate

The 2018 Provincial Budget introduced the government’s 30-Point Plan for Housing Availability in British Columbia.  One of the “points” in the Plan is to address what the government refers to as “hidden ownership”, whereby the true beneficial owner of a property is obscured by holding it in trusts or shell corporations. The government’s concern is that hiding ownership in such a way can facilitate tax evasion, money laundering, and fraud.

In June, 2018, the Ministry of Finance released a White Paper with a proposed Land Owner Transparency Act (the “Act”). The Act proposes to create an ambitious new public registry for beneficial ownership of real estate in the Province, which will hold records on the individuals who fundamentally own and control the land.

Under the Act, corporations, trustees and partners (“reporting bodies”) will be required to identify the individuals that have a beneficial interest in land, that have a significant interest in the land-owning corporation, or that have an interest in land through a partnership.

Reporting bodies will be required to disclose information in three situations:

  1. on any application to register legal title in the name of a reporting body;
  1. any time there is a change of interest holders or beneficial owners (even when this does not result in a transfer of legal title to the land); and
  1. during an initial transition period all those holding an interest in land for a beneficial owner will be required to file a disclosure report.

The information collected will vary based on the type of reporting body.

For corporations, information that must be disclosed includes:

  • the name, head office and business/incorporation number of the corporation;
  • for each person who directly or indirectly own or control 25% of the corporation’s shares, that person’s name, citizenship, place of residence, date of birth, and social insurance number/ individual tax number; and
  • information about the person completing the report.

For trusts, information that must be disclosed includes;

  • identification information about the trustee, beneficial owner(s) and settlor(s);
  • date of birth and social insurance number/individual tax number of beneficial owner(s) and settlor(s); and
  • information about the person completing the report.

For partnerships, information that must be disclosed includes:

  • name, head office and business number of the partnership;
  • each partner’s date of birth and social insurance number/individual tax number; and
  • information about the person completing the report.

The Act will include several provisions to attempt to alleviate privacy concerns some may have with the public database, such as restricting the information available to the public and allowing more sensitive information such as social insurance numbers and dates of birth to be accessible only by certain authorized agencies, such as law enforcement and tax authorities. Furthermore, the information of individuals under the age of 19 or those legally incapable of managing their financial affairs will be automatically omitted and vulnerable individuals, such as victims of domestic abuse, can apply to have their personal information omitted from the publicly accessible database.

The White Paper is currently out for public discussion and comment and the government will accept submissions until the end of day on August 19, 2018.

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