SK Farm Security Board Further Restricts Use of Trusts to Hold Farmland


In 2015 the Government of Saskatchewan introduced significant amendments to The Saskatchewan Farm Security Act (the “Act”). These amendments, among other things, added language to Section 89 of the Act which effectively restricted the acquisition of an interest in farmland by a trust to only those trusts containing 10 or fewer beneficiaries. In addition, the beneficiaries must be individuals (i.e. not corporations or other entities) and Canadian residents.

On October 2, 2017, the Government of Saskatchewan introduced measures to further restrict the acquisition of farmland by a trust.

In particular, Section 2(5) was added to The Saskatchewan Farm Security Regulations. This Section defines who qualifies as a beneficiary for the purpose of Section 89 of the Act. Section 2(5) states:

(5) For the purposes of section 89 of the Act, “beneficiaries of the trust” means persons who are any of the following:

  1. in relation to the settlor:
    1. a spouse;
    2. a child or adult child, including a stepchild, an adopted child or a child with respect to whom the settlor stands in the place of a parent, or the spouse of one of those persons;
    3. a parent;
    4. a brother or sister; or
    5. a parent’s brother or sister;
  2. the issue of a person mentioned in subclause (a).

In essence, Section 2(5) further reduces the ability of trusts to acquire Saskatchewan farmland by prohibiting the acquisition of farm land by trusts, except by those trusts where all the beneficiaries (who must still be individuals and Canadian residents) are also immediate family members of the settlor.

While the full effects of this additional restriction have yet to be fully determined, it is yet one more consideration to take into account when acquiring farmland in Saskatchewan.

Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.