Transparent To The World - Push For Public National Beneficial Ownership Registry Unveiled In 2022 Federal Budget - Corporate and Company Law

Proposed National Corporate and Real Property Beneficial Ownership Registries to be Searchable by the Public

In its quest for corporate transparency, and in order to reinforce the anti-money laundering regime contemplated by the Agreement to Strengthen Beneficial Ownership Transparency entered into in 2017 by the Canadian federal and provincial finance ministers, the Federal Government announced that it plans to implement a public and searchable beneficial ownership registry for federal business corporations before the end of 2023. The proposed registry would disclose ownership interests in corporations.

The Federal Government intends to work with the provinces and territories to create a national registry where data held by the provinces and territories can be accessed across Canada. Although the exact content of the proposed registry has not been specified, such registries typically include information on an ultimate beneficial owner's name, place of residence, date of birth, and how the beneficial owner controls the corporation.

To further improve beneficial ownership transparency, the Federal Government has also expressed intentions to establish a national beneficial ownership registry for real property.

Current Corporate Transparency Landscape in Canada

Corporate beneficial ownership registers were first introduced by the Federal Government in 2019 and apply to private corporations governed by the Canada Business Corporations Act. Each private corporation must keep a register of individuals with significant control of the company. Although corporations must disclose the register to investigative agencies such as the Canada Revenue Agency ("CRA") and the police, it is not required to disclose such information to the public. For more information please see Fasken's Blog "Timely Disclosure - Bill C-86 – New record-keeping obligations for all CBCA private companies" of June 5, 2019.

The purpose of the beneficial ownership or "transparency" registers is to assist in combatting tax evasion, money-laundering, and terrorist financing. Similar registries exist in many OECD member states. The United States are also set to introduce beneficial ownership registers for U.S. companies under its 2021 Corporate Transparency Act.

In British Columbia, similar requirements for private B.C. companies came into force in October 2020. For more information, please see our bulletins "New Transparency Registers for B.C. Private Companies" and "Transparent in other Ways – New Exemptions to British Columbia's Corporate Transparency Register Rules".

With respect to the other Canadian provinces:

In Ontario, changes to the Business Corporations Act introducing obligations for Ontario corporations to prepare registers of individuals with "significant control" will come into force on January 1, 2023.
Corporate transparency requirements also exist in Manitoba and Prince Edward Island.
Newfoundland and Labrador has adopted similar requirements and the rules came into force on April 1, 2022.
In New Brunswick, a bill to incorporate beneficial ownership disclosure obligations in its Business Corporations Act is still early in the legislative process.
Saskatchewan has adopted, but not yet implemented its beneficial ownership disclosure rules.
In Québec, Bill 78 which has been adopted, but has yet to come into force, will make beneficial ownership information available on the Registre des Entreprises du Québec. This means that in Québec, members of the public will be able to conduct a search by the name of a natural person and access sensitive information such as the date of birth and the address of the domicile of beneficial owners of Québec corporations.
Alberta, Yukon, Northwest Territories, and Nunavut have not yet announced plans to adopt a beneficial ownership registry.

Real Property Transparency Registry Re-Examined

Presently, British Columbia is the only province in Canada with a publicly searchable land owner transparency registry. The registry opened to the public in April 2021 and provides the full name, citizenship information, and certain information on the principal residence of any individual with an indirect interest in the land. Any person may access and search the registry for a $5.00 fee. For more information, please see our bulletins "Action Required: Reporting of Any Interest in Land Held in BC" and "Deadline Extended: More Time to File in New Land Owner Transparency Registry".

The Federal Government has announced it intends to work with the provinces and territories to create a national approach to a beneficial ownership registry for land that is similar to the registry being launched in the United Kingdom.

What happens next?

As previously mentioned, it remains to be seen as to how exactly these new registries will be implemented and whether such registries will have any impacts on the current legal corporate transparency landscape, including British Columbia's existing land owner transparency registry.

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