Minister tables changes to close 'loopholes' in P.E.I.'s Lands Protection Act

P.E.I.'s Minister of Land Bloyce Thompson tabled changes to the province's Lands Protection Act in the legislature Wednesday, following through on a commitment to change the law in light of a case where a corporation was able to acquire land without cabinet approval.

"This whole exercise that we just went through is directly because of the investigation into [that] transfer of land," Thompson told reporters. "It's taken a while but … the Lands Protection [Act] is even going to be stronger than ever."

The Lands Protection Act puts limits on corporate and individual land holdings in the province, and requires cabinet sign off on some land purchases by corporations and non-residents.

Two years ago, Thompson vowed to close what he called loopholes in the legislation following an investigation into a land transaction in central Prince Edward Island.

A corporation was able to acquire 890 hectares of land without the transaction going to cabinet for approval.

That corporation, Red Fox Acres, listed Rebecca Irving as its sole director in P.E.I.'s corporate registry. Irving is a member of the larger Irving family with multiple corporate holdings, including potato processor Cavendish Farms.

Two individuals and a corporation "received correspondence asking them to divest land and become compliant with the Lands Protection Act," Thompson said in a written statement on Oct. 27, 2020. 

The statement said the Island Regulatory and Appeals Commission investigation had found "reasonable and probable grounds" that the two individuals and corporation "contravened the Lands Protection Act by having aggregate land holdings in excess of the prescribed limits."

In response, Rebecca Irving and Red Fox Acres filed documents seeking a judicial review of Thompson's decision. That challenge is still underway.

8 of 13 recommendations included in bill

"This addresses the loophole," Thompson told reporters, referring to a specific proposed change which would in some cases require sales of corporate shares to be approved by cabinet, if the sale would result in one of the shareholders owning land above their prescribed limit.

Other changes proposed in the legislation include: 

• A refined definition to determine when a person or corporation has control of another corporation, for determining whether those combined land holdings would put them over their limit.
• New power for the minister to order a divestiture of land. Under the current law, that requires a court order.
• Leeway for landowners to have a maximum of nine years to divest after being ordered, with a timeline requiring growing percentages of the land in question to have been divested over time.
• New fines for any officer, director or agent of a corporation found to have been involved in a contravention of the act, up to $20,000 each. The principal landowner in such a case already faces a fine of up to $250,000 under the act. 

An advisory committee struck by government to examine the issue delivered its final report in July, putting forward 13 recommendations for change.

Thompson said the legislation tabled Thursday addresses eight of the recommendations. He said more changes will be brought forward in the future.

He said government would bring the amendments forward for debate in the hope of passing them during the current fall sitting of the legislature.

Thompson had tabled previous changes to the act two years ago but those were never put forward for a vote.

Investigation yet to be released

Thompson said the proposed changes will also increase transparency in how the province deals with land transactions and investigations.

Ministerial orders for divestiture would be public under the legislation. The Island Regulatory and Appeals Commission would be required to share results of its land holdings investigations with the parties being investigated, which currently isn't the case.

But it would only have to share those investigations with the minister if it was the minister who ordered the investigation.

Meanwhile, the IRAC report that led Thompson to promise all these changes has still not been released to the public, a year after Thompson received it. 

In January, the privacy commissioner told the province it could release the investigation in response to a freedom of information request filed by CBC News. But that request has now been sent back to the commissioner for another review, at the request of a third party.