Canadian Lawyer

w w w . C A N A D I A N L a w y e r m a g . c o m A U G U S T 2 0 1 5 21 the land and to gauge what the province's residents would like the rules to be. The outcome, he said, "could be anything." Saskatchewan farmland is very desirable. Colin Simmons, whose Calgary practice is largely focused on agricultural law, has seen some Alberta farmers sell their valuable land to purchase land in Saskatchewan, which is much cheaper but aggressively rising in value. Young farmers are challenged when trying to buy land in Alberta because of the unique pressures there: the proximity of the Rockies and demands from the oil and gas industry. With cattle prices increasing, combined with ongoing low interest rates, there is once again an increased appeal in farmland, driving up the value. According to lender Farm Credit Canada, the value of Canadian farmland rose by an average of 14.3 per cent over the previous year in 2014, and 22.1 per cent in 2013. While Alberta recorded an increase of 8.8 per cent in 2014 and 12.9 per cent in 2013, Saskatche- wan saw increases of 18.7 per cent in 2014 and 28.5 per cent in 2013. Alberta's rules prohibit foreign ownership of more than 20 acres of agricultural land, although there are exceptions for commercial ventures, including limited natural resource extraction or process- ing and residential development, "The way that the Alberta gov- ernment approaches enforcement is different than Saskatchewan," explains Brian Kaliel, co-founder of Miller Thomson LLP's agricul- tural law practice group. "Foreigners wishing to invest in land can do so with a minority position, but they have to be careful." He points out that Alberta farmland — with its continuously increasing value — has been a productive investment and not just for farmers. At the same time, the industry has seen the development of larger farms, consolidation of farms, and corporate ownership of farms leaving many independent farmers to lease land instead of purchasing it. Unlike the situation in Saskatchewan, the consolida- tion of farms in Alberta seems to be domestically driven. In fact, pressures across the country are wide and diverse. In Ontario there are no restrictions of foreign ownership, the bigger concern is land development. David Germain, of Thomson Rogers, points to the decade-old Greenbelt Plan north of Toronto where development is prohibited and the government has instituted a growth plan to protect green spaces and farmland. "There are a lot of components to the provincial policies that speak to the protection of agricultural land, but they really don't speak to ownership," he says. Manitoba's Farm Lands Ownership Act limits foreign interest in farmland to 40 acres as a means of controlling speculation of food- producing land. Non-Canadian individuals and corporations seek- ing more than 40 acres must apply to the Manitoba Farm Industry Board for an exemption. British Columbia is the only western province without rules specific to foreign ownership despite calls for them. There is an agency that regulates non-agricultural use of farmland and, earlier this year, the government discovered that foreign companies have been buying farmland to plant trees and earn carbon credits. Prince Edward Island's Lands Protection Act limits the amount of land non-P.E.I. residents and corporations could acquire to 165 feet of shoreline and five acres without having to seek approval from the executive council. But it also limits overall ownership of farm- land to 1,000 acres per individual and 3,000 acres for a company. "We only have a limited amount of land and that erodes every day," explains Perlene Morrison, a Charlottetown-based partner with Stewart McKelvey. "We want to preserve land for local farmers." But the pressure P.E.I. farmers face is the need to increase volume in order to remain competitive in today's marketplace. Amendments kicked in earlier this year to recognize that not all land is arable and can be farmed. That non-farmable land can be calculated against the limit which may well lead to an increase in the amount of land a farmer may own. Like P.E.I., Quebec's restrictions focus on main- taining ownership by provincial residents. Next to Saskatchewan, Quebec saw the largest increase in the value of farmland in Canada, jumping 15.7 per cent in 2014 and 24.7 per cent in 2013, accord- ing to Farm Credit Canada. During the last few years, it's attracted increased attention from potential foreign investors, says Jean-Luc Couture, of Therrien Couture avocats in Brassard, Que. "Prior to that there wasn't outside pressure on farmland in Quebec." In addition to rules to protect agricultural use of farmland, the ownership rules — updated last year to strengthen the definition of a Quebec resident — requires purchases of more than four hectares/ 10 acres of farmland by non-Quebec residents and corporations with majority shareholders living outside of Quebec to seek per- mission from the Commission de protection du territoire agricole du Quebec. "This law is trying to ensure we keep control on our farmland," says Couture. While Quebec's powerful agriculture lobby is pushing for more stringent rules in response to increasing pressure from foreign and non-farming investors, the National Farmers Union is putting pres- sure on the federal as well as the provincial governments, reflecting growing calls for the strengthening of existing rules and introduc- tion of new legislation. What do your clients need? The means to move on. Guaranteed ™ . Baxter Structures customizes personal injury settlements into tax-free annuities that can help your clients be secure for life. Need more information? Contact us at 1 800 387 1686 or baxterstructures.com Kyla A. Baxter, CSSC PRESIDENT, BAXTER STRUCTURES Untitled-1 1 13-09-16 2:53 PM

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