Saskatchewan Is Tightening The Fence Around Farmland Ownership: Will Your Financing Structure Cost You?

Saskatchewan has long regulated who can own its farmland. The Saskatchewan Farm Security Act (the “Act”) exists to protect locally owned and operated family farm operations, and the October 2025 amendments to The Saskatchewan Farm Security Regulations (the “Amendments”) mark a shift for both lenders and borrowers.

The Canada Pension Plan Investment Board (the “CPPIB”) exemption has been eliminated, administrative penalties are now clarified, and lenders face increased analysis of borrower ownership structures. The effects reach beyond ownership, requiring lenders, borrowers, and investors to consider their impact on financing structures, due diligence, and overall risk exposure in Saskatchewan’s agricultural sector.

The key changes

1. Elimination of the CPPIB exemption: Building on amendments implemented in 2015, the recent Amendments now remove the prior exemption that allowed the CPPIB to own Saskatchewan farmland, both prohibiting CPPIB from owning farmland in Saskatchewan and from acquiring farmland in the future.
2. Authority of the Farm Land Security Board: The Amendments clarify the Saskatchewan Farm Land Security Board’s (the “FLSB”) authority to impose monetary administrative penalties for contraventions of the Act and provide greater specificity regarding when penalties may be applied. This includes situations such as:
   • where a non-resident person has or acquires an aggregate land holding with an assessed value of greater than $15,000 (excluding buildings and improvements),
   • where a person who becomes a non-resident continues to hold more farmland than permitted and does not reduce that holding to the allowed limit within five years, and
   • other circumstances where a person fails to comply with the Act, including breaches of ownership restrictions, misuse of exemptions, or providing incomplete or incomplete information to the FLSB in connection with a land holding.

Implications for lenders

• Enhanced due diligence: Lenders may need to take a renewed focus on verifying that borrowers are eligible to own farmland under the Act. This includes reviewing ownership structures, beneficial ownership, and any foreign or institutional interests, particularly in more complex corporate, partnership or trust arrangements. For most transactions this will represent a refinement of existing diligence processes rather than a fundamental change.
• Security enforcement: The Amendments reinforce the oversight role of the FLSB. As such, lenders should remain mindful that enforcement strategies involving farmland must continue to align with the Act’s framework.
• Risk mitigation measures: Lenders may consider updates to standard documentation and monitoring practices, including:
  • Confirming representations regarding compliance with the Act,
  • Requiring ongoing covenants to maintain eligibility for farmland ownership,
  • Conducting periodic compliance reviews throughout the term of a loan, where appropriate.

Implications for borrowers

• Ownership and compliance obligations: Borrowers should continue to remain vigilant in ensuring that their structures comply with the Act. Changes in corporate control, ownership percentages, or partnership arrangements could trigger non-compliance if not carefully managed.
• Financial consequences of non-compliance: The clarification of administrative monetary penalties reinforces that non-compliance can create direct financial consequences.
• Risk mitigation – proactive strategies: Borrowers may mitigate regulatory risk by:
  • Periodically reviewing ownership structures for compliance,
  • Seeking legal and financial advice before implementing material changes to ownership or control,
  • Structure corporate entities and trusts with the Act’s requirements in mind,
  • Maintain clear documentation to demonstrate compliance, if required.

Conclusion

Overall, the Amendments establish an incremental strengthening and clarification of the enforcement framework under the Act. While core ownership rules remain unchanged, these Amendments make compliance expectations clearer.

For lenders, the practical impact is to ensure that existing diligence and documentation practices are sufficient, particularly where borrower structures are more complex or involve evolving ownership.

For borrowers, the changes emphasize the importance of maintaining compliant ownership structures over time, especially in situations involving transitions in ownership, financing or investor participation. Borrowers with more intricate or evolving ownership structures may see increased scrutiny as part of routine lender processes.

As enforcement becomes more robust and penalties more tangible, both lenders and borrowers will benefit from a proactive approach to compliance. Careful structuring, ongoing monitoring, and early engagement with legal and financial advisors will be critical in navigating this evolving regulatory landscape.

It is also important to note that further developments are anticipated. In October 2025, the Ministry of Agriculture announced the formation of a Farm Land Ownership Advisory Committee to consult with industry stakeholders and provide recommendations on strengthening the province’s farmland ownership framework, with a report expected by year-end.