It used to be that a First Nation could only acquire fee simple land in British Columbia through a trust, a corporation, or a society. Under the new Land Title and Property Law Amendment Act, enacted by the Government of British Columbia earlier this summer, First Nations now have the option to acquire, hold, and register fee simple lands, leasehold interests, and other interests in the name of the First Nation.
The Old Regime
Historically, if a First Nation wished to acquire fee simple land in British Columbia, the First Nation would be required to incorporate a corporation or society to purchase the land on behalf of the First Nation. This requirement stemmed from language in the Property Law Act and the Land Title Act which did not include a First Nation as part of the class of individuals who are entitled to have an interest in land in British Columbia.
Many First Nations chose to acquire land through a corporation with the First Nation as a shareholder, or with Chief and Council holding shares in the corporation for the benefit of the First Nation. Although this strategy allowed a First Nation to own land indirectly, First Nations did not have the option of direct ownership of land.
What Has Changed
The changes to the Property Law Act expand the category of entities permitted to acquire, hold, and dispose of land in B.C. to include federally recognized First Nations. The Land Title Act amendments also set out administrative requirements to facilitate the registration of land title documents and the witnessing and execution of those documents. Essentially, a First Nation now has the same legal status to acquire land in British Columbia as any other individual.
The amendments do not affect the current property tax system in British Columbia. As of the time of writing, First Nations will remain liable for property tax and property transfer tax and will be treated as any other individual landowner in British Columbia.
What This Means
There are many reasons why a First Nation may wish to purchase fee simple land in British Columbia, such as to construct social housing for members of the Nation or other community services. The amendments to the Property Law Act and the Land Title Act remove administrative barriers to provide First Nations the flexibility to decide whether land should be purchased in the name of the First Nation or another legal entity depending on the needs and interests of the community.
There are considerations which may make it more desirable for a First Nation to purchase land through a corporation; liability, taxes, and other matters should be reviewed when deciding on a structure. First Nations should also comply with applicable community law and community approval procedures, as the Land Title Office will accept land title documents from a First Nation at face value as if the First Nation were any other individual in British Columbia.
Whether a First Nation decides to purchase fee simple land directly or by way of a separate legal entity, the land ownership changes enacted through the Land Title and Property Law Amendment Act provide options and are a direct step towards reconciliation.
If your First Nation is interested in purchasing fee simple land in British Columbia and you would like to learn more, please reach out to Sayre Potter at [email protected].
