CANADA – QUÉBEC Trends and Developments Contributed by: Eleonora Eusepi and Bruno Burrogano, BCF Business Law LLP
reflected in municipal planning, provincial land use frameworks, and risk assessments. Prohibition on the Acquisition of Property by Non- Residents The federal Prohibition on the Purchase of Residential Property by Non-Canadians Act has been extended until 1 January 2027, continuing to restrict non-Cana - dians, including foreign individuals and foreign-con - trolled corporations, from purchasing certain “resi - dential properties” in Canada. These properties are defined under the Act as buildings with three or fewer dwelling units, as well as condominium units or similar portions of buildings, when located within a Census Metropolitan Area (CMA) or Census Agglomeration (CA) as designated by Statistics Canada. The extension preserves the Act’s original scope with - out modification to its core provisions, maintaining the federal government’s stated housing-affordability objective by limiting foreign speculative activity in urban housing markets where supply pressures and affordability challenges are most acute. Exemptions continue to apply in limited and defined circumstanc - es (including, for example, to purchases made for the purpose of development in certain circumstances) and non-Canadians may still purchase residential property located outside the geographic boundaries of CMAs and CAs, where the prohibition does not apply. Enforcement mechanisms under the Act remain sig - nificant and should not be underestimated. Violations of the Act can result in fines of up to CAD10,000 for the non-Canadian purchaser and, where applica - ble, for other persons who facilitated the contraven - ing transaction. Courts retain the power to order the forced sale of a property purchased in contravention of the prohibition, a remedy that carries severe prac - tical consequences for the owner. Liability may also extend to persons or entities who knowingly assist a non-Canadian in breaching the Act, including, as the legislation contemplates, legal counsel who knowingly facilitates a non-compliant transaction. This provision underscores the compliance obligations of legal prac - titioners involved in residential property transactions with foreign parties.
The 2027 extension aligns with the federal govern - ment’s broader housing-affordability agenda, which includes initiatives such as the Apartment Construc - tion Loan Program, the Housing Accelerator Fund, and more recently Build Canada Homes. Together, these initiatives form a policy framework aimed at curbing speculative pressures on housing markets, increas - ing the supply of purpose-built rental housing, and ensuring that scarce urban housing stock in Canada’s major cities and agglomerations is reserved primarily for residents and legitimate users rather than foreign speculative investment. Agricultural Land In Québec, a major reform of the Act respecting the preservation of agricultural land and agricultural activi - ties (LPTAA) recently came into force, representing a significant development for investors, developers, and landowners with interests in or adjacent to Québec’s designated agricultural zone. This legislative reform reflects the Québec government’s continued com - mitment to the protection of agricultural land as a strategic provincial resource, while also responding to growing concerns about the acquisition of farmland by investment funds and other entities that are not engaged in active agricultural operations. Importantly, the amended LPTAA now regulates the registration of real rights affecting agricultural land, even when such rights are granted by Québec-based corporations or individuals, extending the statute’s reach beyond its prior focus on non-resident or foreign acquirers. The legislature’s intent is clear and explicit: to further restrict the acquisition of agricultural land by investment funds and by persons or entities that are not registered agricultural operations, particularly when the land is located within a metropolitan com - munity or a regional county municipality (MRC) desig - nated by government decree. This reform has material implications for the structuring of transactions involv - ing agricultural or agri-adjacent land, and requires careful attention from legal advisors acting on behalf of investors, developers, and landowners in affected regions. Several regulatory provisions implementing the reformed regime remain forthcoming, and the full scope and operational details of the new framework will continue to develop as the necessary implement - ing regulations are adopted and brought into force.
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