It’s a new year and there is no better time to review corporate compliance, like ensuring your minute book is up to date with a listing of the corporation’s Ontario real estate holdings. For corporations relying on the two-year grace period in the legislation, your time is up.
In my October 12, 2016 article, I wrote about amendments to the Ontario Business Corporations Act (OBCA) which came into force December 10, 2016. In short, the OBCA amendments require that a corporation must keep an up-to-date listing of its interests, including beneficial interests in real estate in its minute book, at the registered office of the corporation.
For most corporate entities that own real property, that is not much of a challenge, as it might include an office building, a parking lot, and maybe a warehouse. For a developer, however, with parcels of land being subdivided, bought and sold as part of the business, and funded with complex structures involving many lenders, multiple trustees and beneficiaries, it poses a challenge, particularly for ensuring up-to-date corporate compliance.
The OBCA amendments said that corporations registered or continued on or after the in-force date were required to have their real estate listings in place at the time of incorporation or continuation, but they allowed for a grace period of two years for existing corporations. As of December 10, 2018, that grace period expired.