ILN: BUYING AND SELLING REAL ESTATE - AN INTERNATIONAL GUIDE

[BUYING AND SELLING REAL ESTATE IN CANADA - QUÉBEC]

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If the seller is not a Canadian resident, the buyer must withhold 25% of the gross proceeds in trust (typically with the officiating notary) until the Canada Revenue Agency confirms the amount to be paid and issues a certificate of compliance (“tax clearance certificate”) when the tax has been fully paid, at which time any excess funds may be released to the seller. A buyer who fails to withhold and remit the required tax could be held liable for the entire amount, plus penalties and interest. VII. RECORDING REAL ESTATE DOCUMENTS The Québec land register traces all real estate transactions conducted in Québec since its creation in 1830. The overall system is known as the Cadastre du Québec, and the province is divided into various registration divisions, each one of which has its own registry office. Title can be searched electronically via the Index of Immovables, using the lot number. The municipal evaluation is also generally accessible on-line, depending on the municipality, using the civic address, which will also yield the lot number(s). Copies of the registered deeds may also be ordered on-line. Leases under Québec law are a personal, rather than a real, right. However, notice of the lease may be published against the title. This protects the tenant by ensuring that if the property is sold, the new owner must respect the balance of the term of the lease, including any renewal options. If the lease was not published before the sale, the new owner is only obliged to continue it for the shorter of the balance of the term (not including renewals) and 12 months from the date of the sale. This puts the tenant is a very precarious position, particularly if the premises are desirable and the rental is below market, if the tenant cannot easily find replacement premises, or if the tenant has made significant improvements and cannot recoup their cost.

Since November 8, 2021, all documents to be published at the Land Registry may only be submitted electronically. A digital inscription may be submitted by land surveyors and bailiffs, in addition to lawyers and notaries, even if they did not prepare the underlying document. VIII. CHARTER OF THE FRENCH LANGUAGE The Charter of the French Language (Québec), as amended by Bill 96 ( An Act respecting French, the official and common language of Québec ) adopted on June 1, 2022, makes French the exclusive official language in the Province of Québec, although other languages (such as English) may be used in certain circumstances and under certain conditions. Several provisions came into effect as of September 1, 2022, with others to follow over the next three years. Since September 1, 2022, regardless of the date of their signature, all deeds, and other documents (example, a notice of lease) submitted for publication at the Québec land registry office must be filed exclusively in French; if filed in a language other than French, they must be accompanied by a certified French translation, failing which they will be rejected. A contract for the sale or exchange of part or all of a chiefly residential immovable of fewer than five dwellings, or of a fraction of a chiefly residential immovable that is the subject of an agreement or declaration of co-ownership must be drawn up in French but may be prepared exclusively in another language if all parties expressly so agree. However, the promise to enter into such a contract, as well as the preliminary contract required to be entered into between a builder or developer and an individual purchaser of an existing or planned residential immovable, and the memorandum required to accompany it if the immovable is to be held in co-ownership

ILN Real Estate Group – Buying and Selling Real Estate Series

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