As of December 10, 2016 all corporations incorporated under the Business Corporations Act (Ontario)(“OBCA”) with ownership interests in real property in Ontario have new record keeping requirements.
As of December 10, 2016 all Ontario corporations with ownership in real property in Ontario must prepare and maintain at their registered office a register of “ownership interests” in land as a result of a newly enacted section 140.1 in the OBCA.
This obligation applies immediately to all corporations that are incorporated or continued under the OBCA on or after December 10, 2016. However, corporations that were incorporated or continued under the OBCA before December 10, 2016, will have until December 10, 2018 to ensure compliance with section 140.1(e) of the OBCA.
“Ownership interests” is not defined however it likely includes both legal and beneficial interests in real property.
The new section 140.1 requires that Ontario corporations maintain a land register which:
- identifies each property; and
- shows the date the corporation acquired the property, and the date the corporation disposed of it.
In addition, supporting documents for each land interest must be kept with the land register. This includes things like copies of any deeds or transfers.
Importantly, the new land register must be kept at the registered office of the corporation. As such it may have to be maintained apart from the Ontario corporation’s minute book.
The land register obligation only extends to Ontario corporations and their ownership interests in real property within Ontario.
Why do you need to ensure compliance?
- In order to dissolve an Ontario corporation, a statement will have to be made as to whether the corporation was at any time a registered owner of land in Ontario;
- To ensure representations regarding compliance with law made to banks and other stakeholders are true;
- To enable corporate legal opinions regarding compliance with laws may be given.
For these reasons it is important to comply with the new land register requirement under the Act. Certain corporations, like those involved in land development, homebuilding, or others in the real property industry may have to update their land register on a daily basis.
We are experts in corporate minute book requirements and can help your Ontario corporation meet the new requirements. Speak to us today.