1.1 Fair Market Value Of Land With Industrial Improvements

• 1.1 (1) For the purposes of a transaction referred to in paragraph (a)(i), (iii) or (iv) of the definition of “taxable transaction”,

• (a) if
  • (i) the transferor is the government, or
  • (ii) the transfer is between associated corporations within the meaning of section 256 of the Income Tax Act (Canada), and
• (b) the land being transferred includes an industrial improvement, the fair market value of the land with industrial improvements is deemed to be, at the election of the transferee,
• (c) the value of
  • (i) the land without industrial improvements as determined under section 19 of the Assessment Act, and
  • (ii) the industrial improvements as determined under section 20 of the Assessment Act, or
• (d) the value resulting from an appraisal of the land with industrial improvements prepared, at the expense of the transferee, by an appraiser referred to in subsection (2).

• (2) For the purposes of subsection (1)(d), any of the following persons may do an appraisal:

• (a) a person designated Accredited Appraiser Canadian Institute by the Appraisal Institute of Canada;
• (b) a person qualified as an appraiser by the Real Estate Institute of British Columbia.

• (3) The appraisal referred to in section (1)(d) must value the land with industrial improvements on the basis of the following principles:

• (a) the value is to be the value of the unencumbered fee simple interest as at the date of the application to register the taxable transaction;
• (b) the valuation must be in conformity with the Uniform Standards of Professional Appraisal Practice and the Canadian Supplement;
• (c) the valuation must be the most probable price which the land with industrial improvements would bring in a competitive and open market under all conditions requisite to a fair sale;
• (d) the valuation must represent the normal consideration for the land with industrial improvements if sold without special or creative financing or sales concessions granted by anyone associated with the sale;
• (e) the valuation must be in accordance with the following assumptions:
  • (i) the buyer and seller are each acting prudently and knowledgeably;
  • (ii) the buyer and seller are both motivated to transact;
  • (iii) a reasonable time is allowed for exposure of the land in the open market;
  • (iv) there is more than one willing purchaser;
  • (v) properties or supplies which produce input materials for a facility located on the land continue to supply inputs for their natural life span.

• (4) Subsection (1) does not apply to a transaction referred to in paragraph (a)(iii) of the definition of “taxable transaction” if the unexpired term of the lease agreement, including all options to renew, is 30 years or less.

1997-27-30, effective May 15, 1997.