Foreign Ownership Limits on Alberta Farmland and Recreational Land

If you are a foreign buyer, or a corporation with non-Canadian shareholders, Alberta's farmland and recreational land rules set a firm acreage limit. Knowing how the limit is counted helps you avoid a deal that cannot be registered.

This article explains the 20-acre rule, the exemptions, the special cases for co-owners and corporations, the separate federal rules on residential property, and the consequences of going over.

This article covers the law of Alberta.

What land and which buyers are covered

Under the Agricultural and Recreational Land Ownership Act, controlled land is land in Alberta other than Crown land, land within city, town, village or summer village boundaries, and mines and minerals. The Lieutenant Governor in Council may make regulations restricting interests in controlled land.

Under the Foreign Ownership of Land Regulations, no ineligible person or foreign controlled corporation may take or acquire controlled land, except that not more than 2 parcels totalling not more than 20 acres are allowed. An ineligible person is a non-citizen, non-permanent-resident individual, a foreign government or agency, or a corporation incorporated outside Canada.

Canadian citizens and permanent residents (landed immigrants) are not affected by the regulations, and trusts cannot be used to get around them. Non-Canadians who are not permanent residents are restricted only as to controlled land, meaning rural agricultural and recreational land, and not land inside city, town, village or summer village boundaries.

The 20-acre limit

The general limit allows not more than 2 parcels totalling not more than 20 acres. Both numbers matter, so it helps to count parcels and acres together before you commit to a purchase.

For corporations, foreign control means share ownership of 50% or more foreign, or effective control by foreigners. For public corporations only shareholders owning 5% or more are counted, provided two-thirds of directors are Canadian citizens or permanent residents.

Tenants in common may not acquire an interest in a parcel over 20 acres if more than 5 ineligible persons or foreign controlled corporations would hold it.

Exemptions

Other exemptions cover right-of-entry orders, pipelines, power and telephone systems, inherited estates, court charges for spouses or children, and cemetery plots. Leases of 20 years or less are allowed if registered within 60 days, and options to purchase are allowed if exercisable within one year. A foreign person may also seek an Order in Council, which is granted at the Lieutenant Governor in Council's discretion.

Divestiture and judicial sale

Land held under certain exemptions must be divested within 3 years of the purpose ending, reclamation completing or the purpose being abandoned. A corporation that becomes foreign controlled through share changes, amalgamation or foreclosure generally has 3 years to divest, unless it stops being foreign controlled for at least 12 continuous months within that period. After a foreclosure, the ineligible person must divest within 3 years.

If limits are exceeded, a court may, on the Attorney General's application, order a judicial sale of land that must be divested or was acquired unlawfully. Proceeds first cover costs, then the owner's purchase price, and any remainder goes to the General Revenue Fund.

The separate federal rules on residential property

A federal law applies alongside Alberta's rules. The Prohibition on the Purchase of Residential Property by Non-Canadians Act prohibits a non-Canadian from purchasing, directly or indirectly, any residential property. A non-Canadian is an individual who is not a Canadian citizen, registered Indian or permanent resident, a corporation incorporated outside Canada, or certain unlisted Canadian corporations controlled by them.

A non-Canadian who breaks the ban, or a person who knowingly helps one do so, is liable on summary conviction to a fine of not more than $10,000. Property outside a census agglomeration or census metropolitan area is excluded from residential property, so the federal ban generally does not reach rural land outside those areas. The ban continues to January 1, 2027, so it is worth confirming its current status before you buy.

• Temporary residents with a work permit that has 183 days or more of validity remaining may buy no more than one residential property.
• A non-Canadian buying with a spouse or common-law partner who is a Canadian citizen, registered Indian or permanent resident is an exception, as are certain protected persons.
• Acquisitions by inheritance, divorce, separation or gift, renting to a tenant, and acquisitions for development are not caught.

What to do next

Declarations are required with transfers, transmissions, caveats or subdivision plans, and the Registrar shall refuse to register a transfer, transmission, caveat or lease without the statutory declaration.

• Count the parcels and acres of controlled land involved, keeping both the 2-parcel and 20-acre limits in mind.
• Map your corporation's shareholders against the 50% and 5% thresholds.
• Identify whether an exemption fits your intended use and acreage.
• Find out which declarations your transfer, caveat or lease will need, since the Registrar must refuse registration without them.
• If a corporation owns controlled land, watch for an annual report (Form 5) when the Minister requires it.
• Check whether the federal residential property rules could also apply to your purchase.
• Get legal advice before signing, especially if shares or land may change hands.

Frequently asked questions