What pesticide licences and other Ontario rules matter when buying or selling a landscaping business?

If a landscaping company never applies a pesticide, the licensing parts of this page may not apply to it. The Act defines a pesticide broadly: any organism, substance or thing manufactured, represented, sold or used to control, prevent, destroy, mitigate, attract or repel any pest, or to alter the growth, development or characteristics of plant life that is not a pest. For those that do, Ontario’s Pesticides Act sets licensing rules that a sale does not carry over. Section 5 prohibits performing an extermination, or operating an extermination business, except under a licence of a prescribed class or unless exempt under the regulations. Section 33 says a licence or permit is not transferable. Section 7.1 also limits which active ingredients may be used in, on or over land. This page covers Ontario only; for the broader sale picture, see selling a landscaping business in Canada.

Two licences, two questions

Section 5(1) of the Pesticides Act says no person shall engage in, perform or offer to perform an extermination except under a licence of a prescribed class, using a pesticide of a class and under the conditions prescribed for it, unless exempt under the regulations. Section 5(2) separately says no person shall operate an extermination business except under a licence of a prescribed class or unless exempt. The Act defines an “operator” as a person who has the control and management of an extermination business. The Act defines a land extermination as the destruction, prevention or control in, on or over land of a pest or pests by the use of a pesticide, excluding structural and water exterminations and the control of termites, so a buyer should ask the Ministry whether the company’s work falls within it.

Licences do not pass to the buyer

Section 33 says a licence or a permit under the Act is not transferable. A buyer of a business that held an operator’s licence cannot step into it, and an exterminator’s licence is held by the individual. Ask the Ministry of the Environment, Conservation and Parks what it requires on a change of ownership before closing, so that the company is not operating, even for a short time, without a licence it needs.

What an operator’s licence application involves

Under O. Reg. 63/09, if an operator’s licence applicant is an individual, they shall be a licensed exterminator. An applicant must submit a list of the names and licence numbers of all licensed exterminators it employs. A corporation or partnership must have one or more official representatives who are directors, officers or partners and who are at least 18 years of age. An operator’s licence, if not renewed, expires on December 31 of the year in which it or its latest renewal takes effect, and an exterminator’s licence, if not renewed, expires on the fifth anniversary of the day on which it or its latest renewal takes effect, subject to section 34.2(4). The official representatives must ensure that the corporation or partnership complies with the Act and the regulations, so a buyer’s company should decide who will take on that duty. The regulation also says an exterminator applicant must have completed, within 12 months before applying, a Director-approved course for the relevant class, or have other qualifications the Director considers equivalent.

Insurance and cosmetic-use limits

Section 9 says an operator shall insure against liability or furnish a bond as provided for by the regulations. Section 7.1(1) says that, subject to subsection (2), no person shall use or cause or permit the use in, on or over land of an active ingredient unless the Director has determined, in accordance with the regulations, that it is appropriate for use for a cosmetic purpose and has listed it in a prescribed document published by the Ministry. Subsection (2) sets out exceptions: uses related to golf courses (if any prescribed conditions are met), agriculture, forestry, the promotion of public health or safety, and other prescribed uses. Under section 7.1(5), a municipal by-law is inoperative if it addresses the use, sale, offer for sale or transfer of a pesticide that may be used for a cosmetic purpose.

WSIB steps in a landscaping sale

The WSIB says that if you are selling or purchasing a business’ assets, you should get a purchase certificate. Its clearance-certificate policy is a different tool: a clearance relieves a principal of liability for payment obligations to the WSIB that a contractor or sub-contractor may incur under a contract between them, during the validity period of the clearance. The WSIB also says it may hold the purchaser liable for all amounts owed by the vendor up to the date of sale if there is no valid purchase certificate, and that the request must be made before the date of sale. Ask which of these the transaction calls for, and when each request has to be made.

• Does the company apply pesticides at all, and if so, which licences does it hold and in whose name?
• Which licensed exterminators are employed, and will they remain after closing?
• What insurance or bond does the operator rely on, and does it continue under new ownership?
• Has the Ministry confirmed what the buyer must file on a change of ownership?
• Has a WSIB purchase certificate been requested before the date of sale?