On 1 January 2023 the Prohibition on the Purchase of Residential Property by Non-Canadians Act entered into force. Unless an exception applies, the Act prohibits the purchase of residential property in Canada by non-Canadians  - including foreign-controlled companies incorporated in Canada - for two years.  On 27 March 2023, the Regulations Amending the Prohibition on the Purchase of Residential Property by Non-Canadians Regulations entered into force. These amendments expand exceptions to allow non-Canadians to purchase residential property in certain specific circumstances (e.g. to allow more work-permit holders to purchase residential property, exclude from the prohibition lands that did not contain habitable dwelling and that were zoned for residential and mixed use, and introduce exceptions for development purposes).
"Definitions
2 The following definitions apply in this Act. […]
non-Canadian means
(a) an individual who is neither a Canadian citizen nor a person registered as an Indian under the Indian Act nor a permanent resident;
(b) a corporation that is incorporated otherwise than under the laws of Canada or a province;
(c) a corporation incorporated under the laws of Canada or a province whose shares are not listed on a stock exchange in Canada for which a designation under section 262 of the Income Tax Act is in effect and that is controlled by a person referred to in paragraph (a) or (b); and
(d) a prescribed person or entity. (non-Canadien)
permanent resident has the same meaning as in subsection 2(1) of the Immigration and Refugee Protection Act. (résident permanent) [...]
residential property means any real property or immovable, other than a prescribed real property or immovable, that is situated in Canada and that is
(a) a detached house or similar building, containing not more than three dwelling units, together with that proportion of the appurtenances to the building and the land subjacent or immediately contiguous to the building that is reasonably necessary for its use and enjoyment as a place of residence for individuals;
(b) a part of a building that is a semi-detached house, rowhouse unit, residential condominium unit or other similar premises that is, or is intended to be, a separate parcel or other division of real property or immovable owned, or intended to be owned, apart from any other unit in the building, together with that proportion of any common areas and other appurtenances to the building and the land subjacent or immediately contiguous to the building that is attributable to the house, unit or premises and that is reasonably necessary for its use and enjoyment as a place of residence for individuals; or
(c) any prescribed real property or immovable. (immeuble résidentiel)
[...]
Prohibition
4 (1) Despite section 34 of the Citizenship Act, it is prohibited for a non-Canadian to purchase, directly or indirectly, any residential property.
Exception — persons
(2) Subsection (1) does not apply to
(a) a temporary resident within the meaning of the Immigration and Refugee Protection Act who satisfies prescribed conditions;
(b) a protected person within the meaning of subsection 95(2) of that Act;
(c) an individual who is a non-Canadian and who purchases residential property in Canada with their spouse or common-law partner if the spouse or common law-partner is a Canadian citizen, person registered as an Indian under the Indian Act, permanent resident or person referred to in paragraph (a) or (b); or
(d) a person of a prescribed class of persons.
Exception — circumstances
(3) Subsection (1) does not apply in prescribed circumstances.
Foreign state
(4) For greater certainty, nothing in subsection (1) is to be construed as hindering a foreign state from purchasing residential property for diplomatic or consular purposes.
Non-application
(5) Subsection (1) does not apply if the non-Canadian becomes liable or assumes liability under an agreement of purchase and sale of the residential property before the day on which this Act comes into force.[...]" (Prohibition on the Purchase of Residential Property by Non-Canadians Act, S.C. 2022, c.10, s.235, 6 March 2023, Sections 2 and 4)
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"1 The following definitions apply in these Regulations. [...]
control with respect to a corporation or entity, means
(a) direct or indirect ownership of shares or ownership interests of the corporation or entity representing 10% or more of the value of the equity in it, or carrying 10% or more of its voting rights; or
(b) control in fact of the corporation or entity, whether directly or indirectly, through ownership, agreement or otherwise. (contrôle)
Non-Canadian — prescribed entities
2 For the purposes of paragraph (d) of the definition non-Canadian in section 2 of the Act, the following entities are prescribed:
(a) an entity formed otherwise than under the laws of Canada or a province; and
(b) an entity formed under the laws of Canada or a province – whose shares or ownership interests are not listed on a stock exchange in Canada for which a designation under Section 262 of the Income Tax Act is in effect – and controlled by an entity referred to in paragraph (a) or controlled by a person referred to in paragraph (a), (b) or (c) of the definition non-Canadian in section 2 of the Act.
Residential property — exclusion
3 (1) For the purposes of the portion of the definition residential property in section 2 of the Act before paragraph (a), a property that is located in an area of Canada that is not within either a census agglomeration or a census metropolitan area is a prescribed real property or immovable.
Prescribed real property or immovable
Purchase
4 (1) For the purposes of the Act, the acquisition, with or without conditions, of a legal or equitable interest or a real right in a residential property constitutes a purchase.
Exceptions
(2) However, a purchase referred to in subsection (1) does not include
(a) the acquisition by an individual of an interest or a real right resulting from death, divorce, separation or a gift;
(b) the rental of a dwelling unit to a tenant for the purpose of its occupation by the tenant;
(c) the transfer under the terms of a trust that was created prior to the coming into force of the Act;
(d) the transfer resulting from the exercise of a security interest or secured right by a secured creditor; or
(e) the acquisition by a non-Canadian of residential property for the purposes of development.
Temporary residents — prescribed conditions
5 For the purposes of paragraph 4(2)(a) of the Act, the temporary resident must satisfy one of the following conditions:
(a) if they are enrolled in a program of authorized study at a designated learning institution, as defined in section 211.1 of the Immigration and Refugee Protection Regulations,
(i) they filed all required income tax returns under the Income Tax Act for each of the five taxation years preceding the year in which the purchase was made,
(ii) they were physically present in Canada for a minimum of 244 days in each of the five calendar years preceding the year in which the purchase was made,
(iii) the purchase price of the residential property does not exceed $500,000, and
(iv) they have not purchased more than one residential property; or
(b) if they hold a work permit, as defined in section 2 of the Immigration and Refugee Protection Regulations, or are authorized to work in Canada under section 186 of those Regulations,
(i) they have 183 days or more of validity remaining on their work permit or work authorization on the date of purchase, and
(ii) they have not purchased more than one residential property.
Exception — persons
6 For the purposes of paragraph 4(2)(d) of the Act, the following classes of persons are prescribed:
(a) foreign nationals who hold a passport that contains a valid diplomatic, consular, official or special representative acceptance issued by the Chief of Protocol for the Department of Foreign Affairs, Trade and Development;
(b) foreign nationals, with valid temporary resident status, whose temporary resident visa was issued, or temporary resident status was granted, following an exemption provided under section 25.2 of the Immigration and Refugee Protection Act, if the Minister is of the opinion that the exemption was justified based on public policy considerations to provide safe haven to those fleeing conflict; and
(c) persons that have made a claim for refugee protection in accordance with subsection 99(3) of the Immigration and Refugee Protection Act, if that claim has been found eligible and referred to the Refugee Protection Division under subsection 100(1) of that Act. [...]
Exception — circumstances
8 For the purposes of subsection 4(3) of the Act, subsection 4(1) of the Act does not apply if it is incompatible with the rights recognized and affirmed by section 35 of the Constitution Act, 1982. [...]" (Prohibition on the Purchase of Residential Property by non-Canadians Regulations, SOR/2022-250, Canada Gazette, Part 2, Vol.156, Number 26, 2 December 2022, Sections 1, 2, 3, 4, 5, 6, and 8, as amended)
Prohibition on the Purchase of Residential Property by Non-Canadians Act, S.C. 2022, c.10, s.235, 6 March 2023, Sections 2 and 4
Prohibition on the Purchase of Residential Property by non-Canadians Regulations, SOR/2022-250, Canada Gazette, Part 2, Vol.156, Number 26, 2 December 2022, Sections 1, 2, 3, 4, 5, 6, and 8, as amended
Amendments to the Prohibition on the Purchase of Residential Property by Non-Canadians Act’s accompanying Regulations, Canada Mortgage and Housing Corporation, 27 March 2023
[<a href="https://laws-lois.justice.gc.ca/eng/acts/P-25.2/page-1.html">Act</a>],[<a href="https://canadagazette.gc.ca/rp-pr/p2/2022/2022-12-21/html/sor-dors250-eng.html">Reg</a>],[<a href="https://canadagazette.gc.ca/rp-pr/p2/2023/2023-04-12/html/sor-dors66-eng.html">Amendment</a>]