C-8.3 - Act respecting international financial centres

Updated to 7 June 2004

This document has official status.

chapter C-8.3

Act respecting international financial centres

CHAPTER I OBJECT AND MISSION

1. The purpose of this Act is to facilitate, mainly by means of tax incentives, the establishment, development and maintenance within the territory of Ville de Montréal of businesses specializing in international financial transactions.

1999, c. 86, s. 1.

2. The mission of the Minister is to foster and provide support for the development of Montréal as a centre for international financial activities and oversee the development and implementation of strategies to promote and solicit the establishment of new international financial centres and new international financial activities within the territory of Ville de Montréal.

The Minister may join with CFI Montréal — Centre Financier International or any other body pursuing similar objectives in order to improve the convergence and effectiveness of the promotional and solicitation activities directed at international financial markets.

1999, c. 86, s. 2.

3. The Minister shall develop, propose to the Government and supervise the implementation of orientations and policies designed to foster the development of Montréal as an international financial centre.

1999, c. 86, s. 3.

CHAPTER II INTERPRETATION

4. In this Act, unless the context indicates otherwise,

“administration” in relation to the shares of a qualified investment fund means the administration of the shareholders’ accounts;

“adviser” means an adviser within the meaning of section 5 of the Securities Act (chapter V-1.1), authorized to act in that capacity under that Act;

“back office activities” means the behind-the-scenes administrative tasks associated with front-line financial activities;

“business” means a business within the meaning of section 1 of the Taxation Act (chapter I-3) or part of such a business;

“Canadian corporation” has the meaning assigned by section 1 of the Taxation Act;

“Canadian debt security” means any of the following securities:

(1)  a bond or debenture, other than a convertible bond or debenture, issued by a Canadian corporation;

(2)  a bond or Treasury bond issued by the Government of Canada or the government of a province, including a bond or Treasury bond issued by any of their respective state-owned corporations; or

(3)  a coupon detached from a security described in paragraph 1 or 2;

“cash management” includes the management and planning of cash flow operations, in particular the management of market, foreign exchange and interest rate risks and the management of financing operations;

“dealer” means a dealer within the meaning of section 5 of the Securities Act, authorized to act in that capacity under that Act;

“distribution” of the shares of a qualified investment fund means the operations connected with the sale of the shares;

“employee” has the meaning assigned by section 1 of the Taxation Act;

“financial corporation” means a bank, a savings and credit union, a loan corporation, a trust company, a corporation dealing in securities, an insurance corporation or any other similar financial or insurance institution, liable for tax under Part IV or VI of the Taxation Act or that would be liable for such tax if it had an establishment in Québec, within the meaning of sections 12 to 16.2 of that Act, or carried on a business in Québec;

“financial derivative” means a contract, instrument or security, the market price, value or payment obligations of which is derived from an underlying interest or from the relationship between certain underlying interests;

“financial packaging services” means providing advice or other technical assistance for project financing, including the services relating to strategic planning, term financing through private placement, the financial aspect of privatization of operations, the submission of financial information to lenders, the negotiation of short-term credit contracts, the implementation of an international cash management organization and the financial aspect of business acquisitions and mergers;

“fiscal period” has the meaning assigned by Part I of the Taxation Act;

“foreign entity” means the government of a foreign country or of a political subdivision of a foreign country or a corporation other than a Canadian corporation;

“foreign exposure” means, in relation to a fund, portfolio or financial product, the result of either or, as the case may be, of the total, of the following aggregates:

(a)  the aggregate of one or more physical securities that are qualified securities and that are not combined with a financial derivative position; and

(b)  the aggregate of one or more financial derivative positions, combined or not with physical securities, the underlying interest of which, resulting from the net position, is foreign;

“foreign financial derivative” means a financial derivative the underlying interest of which is foreign;

“international financial transaction” includes an international insurance activity;

“management” of a qualified investment fund means the management of a part or all of the assets of the investment fund;

“organization” of a qualified investment fund means the design and creation of the fund, including research, the preparation and distribution of a prospectus for the fund, the registration of the fund with the Agence nationale d’encadrement du secteur financier or any other securities supervisory agency, the marketing of the fund and the organization of the distribution of the shares of the fund;

“person” includes a corporation;

“physical security” means any security other than a financial derivative;

“province” has the meaning assigned by section 1 of the Taxation Act;

“qualified investment fund” means an investment fund that is an unincorporated mutual fund or a mutual fund within the meaning of section 5 of the Securities Act or a segregated account of a life insurance corporation established by a by-law of the insurance corporation or a resolution of the board of directors of the corporation;

“qualified security” means

(1)  a security listed on the International Options Market, Mercantile or International Division of the Montréal Exchange, if the transaction relating to the acquisition of the security was executed thereon;

(2)  a security issued by a Canadian corporation, if the transaction relating to the acquisition of the security was executed on an organized securities market situated outside Canada;

(3)  a security issued by the Government of Canada or the government of a province, including a security issued by any of their respective state-owned corporations, other than a security governed by Canadian law; or

(4)  a security relating to a foreign entity;

(5)  a foreign financial derivative.

“qualified services in relation to a financial product” means the development of a new financial product or the designing of a customized financial product for a particular customer or situation;

“security” means any of the forms of investment listed in section 1 of the Securities Act, except a share in an investment club;

“strategic personnel” of a business of a corporation or partnership means the personnel of the corporation or partnership who is assigned to the direction and design of the back office activities carried on by the corporation or partnership in the course of the operations of the business or who has specific expertise in the field of back office activities and is assigned to client solicitation activities in relation to the back office activities carried on by the corporation or partnership in the course of those operations;

“taxation year” has the meaning assigned by Part I of the Taxation Act;

“underlying interest” means any security, commodity, financial instrument, currency, interest rate, foreign exchange rate, economic indicator, index, basket, contract, benchmark or other reference, interest or variable.

1999, c. 86, s. 4; 2001, c. 51, s. 316; 2002, c. 9, s. 1; 2003, c. 9, s. 3; 2002, c. 45, s. 251.

5. In this Act,

(1)  a legal person, whether or not established for pecuniary gain, is designated by the word “corporation” ;

(2)  a person is considered to be a person resident in Canada where the person is so considered for the purposes of the Taxation Act (chapter I‐3), and a person is considered to be a person not resident in Canada in all other cases.

1999, c. 86, s. 5.

6. In this Act, an international financial centre means a business

(1)  that is carried on by a corporation or partnership ;

(2)  all the activities of which pertain to qualified international financial transactions ;

(3)  the management of the activities of which that lead to the completion of qualified international financial transactions carried out in the course of the operations of the business is conducted entirely within the territory of Ville de Montréal ;

(4)  the activities of which are grouped together in one place within the territory of Ville de Montréal ;

(5)  in respect of which the corporation or partnership keeps a separate accounting of its operations attributable thereto ; and

(6)  in respect of which the corporation or partnership holds a certificate that is valid for a period that includes the time during which this definition applies.

The conditions set out in subparagraphs 3 and 4 of the first paragraph shall not be considered not satisfied merely because a qualified international financial transaction described in paragraph 9 of section 7 was initiated by a client who, for that purpose, went to an office or branch of the corporation or partnership other than the place referred to in that subparagraph 4.

1999, c. 86, s. 6.

7. In this Act, “qualified international financial transaction” means

(1)  trading in outstanding securities or a securities distribution, carried out by a dealer, except an operation referred to in paragraph 9;

(2)  operating a clearing house in relation to a transaction to which not more than one party is or includes a person resident in Canada;

(3)  securities advising and portfolio management carried on by an adviser for a person not resident in Canada, or for a person resident in Canada if the advising or management, as the case may be, pertains to a security that would be a qualified security if the definition of that expression in section 4 were read without reference in paragraphs 1 and 2 to “the acquisition of”, or if the securities portfolio were established for the purpose of being subject, exclusively or almost exclusively, to foreign exposure;

(4)  making or accepting deposits of money on behalf of a person not resident in Canada;

(5)  making loans of money to a person not resident in Canada if the funds are used outside Canada;

(6)  lending or borrowing money by corporations or partnerships each operating an international financial centre, if the money is lent in the course of the operations of the lender’s international financial centre, and borrowed in the course of the operations of the borrower’s international financial centre, and, for the purposes of this paragraph, a corporation registered under the International Financial Business (Tax Refund) Act (Revised Statutes of British Columbia, 1996, chapter 235) is deemed to be a corporation that operates an international financial centre whose operations pertain to the activities for which it is so registered;

(7)  accepting or issuing letters of credit in respect of any of the following operations or transactions to which not more than one party is or includes a person resident in Canada :

(a)  an operation or transaction relating to property or goods, and

(b)  an operation or transaction relating to the provision of services;

(8)  financing or refinancing, by means of a bill of exchange between corporations that are financial institutions having no establishment in Canada, within the meaning of sections 12 to 16.2 of the Taxation Act (chapter I‐3), or between international financial centres, an operation or transaction in which neither the purchaser nor the vendor is resident in Canada and in which the property or goods involved are neither located in nor in any way connected with Canada and do not, by reason of the operation or transaction, constitute Canadian exports or imports;

(9)  executing foreign exchange transactions, including the purchase, sale or exercise of a currency option or currency futures contract, except the purchase or sale of bank notes or traveller’s cheques;

(10)  providing financial packaging services in respect of a project to be carried out exclusively or almost exclusively outside Canada;

(11)  providing qualified services in relation to a financial product for or on behalf of a person not resident in Canada, or for or on behalf of a person resident in Canada if the financial product to which the services relate is established for the purpose of being subject, exclusively or almost exclusively, to foreign exposure;

(12)  providing services as a damage insurance broker within the meaning of section 6 of the Act respecting the distribution of financial products and services (chapter D‐9.2), where the services provided permit the conclusion of a damage insurance contract under which the premium is entirely attributable to the occurrence of a risk outside Canada and arising from the carrying on of a business of the insured;

(13)  reinsuring a risk under a damage insurance contract under which the premium is entirely attributable to the occurrence of a risk outside Canada;

(14)  providing fiduciary services for a person not resident in Canada, or for a person resident in Canada if the securities to which the services relate are qualified securities ;

(15)  providing factoring services, where the receivables are payable by a person not resident in Canada;

(16)  providing leasing services to a lessee not resident in Canada, for the use of property outside Canada;

(17)  organizing a qualified investment fund the shares of which are to be sold to persons not resident in Canada, or to persons resident in Canada if the fund is established for the purpose of being subject, exclusively or almost exclusively, to foreign exposure;

(18)  providing administration, in relation to the shares of a qualified investment fund in respect of persons not resident in Canada, or of persons resident in Canada if the fund is established for the purpose of being subject, exclusively or almost exclusively, to foreign exposure;

(19)  providing the management of a qualified investment fund the shares of which are sold to persons not resident in Canada, or to persons resident in Canada if the fund is established for the purpose of being subject, exclusively or almost exclusively, to foreign exposure;

(20)  engaging in the distribution of the shares of a qualified investment fund to persons not resident in Canada, or to persons resident in Canada if the fund is established for the purpose of being subject, exclusively or almost exclusively, to foreign exposure, provided the organization and management of the fund and the administration, where related to the shares of the fund, are carried out exclusively or almost exclusively within the territory of Ville de Montréal;

(21)  providing cash management in respect of activities carried on exclusively or almost exclusively outside Canada;

(22)  carrying on back office activities for or on behalf of

(a)  a corporation or partnership that operates an international financial centre, in relation to a qualified international financial transaction carried out by the corporation or partnership, except back office activities referred to in subparagraph b,

(b)  a financial corporation, in relation to a financial transaction or a transaction in relation to insurance carried out by the financial corporation and to which not more than one party is or includes a person resident in Canada, or

(c)  a person not described in subparagraph a or b, in relation to a qualified international financial transaction carried out by that person;

(23)  handling documentary collections in respect of any of the following operations or transactions to which not more than one party is or includes a person resident in Canada :

(a)  an operation or transaction relating to property or goods, and

(b)  an operation or transaction relating to the provision of services.

1999, c. 86, s. 7; 2001, c. 51, s. 317; 2002, c. 40, s. 1.

8. For the purposes of paragraph 1 of section 7,

(1)  trading in outstanding securities as an intermediary in the negotiation shall be carried out only for or on behalf of

(a)  a person not resident in Canada, or

(b)  a person resident in Canada, if the trading relates to securities that would be qualified securities if the definition of that expression, in section 4, were read without reference to the words “the acquisition of” in paragraphs 1 and 2;

(2)  trading in outstanding securities as a principal shall be carried out only if the trading relates to

(a)  a security that would be a qualified security if the definition of that expression, in section 4, were read without reference to the words “the acquisition of” in paragraphs 1 and 2, or

(b)  a Canadian debt security, where

i.  the transaction is made in order to build up an inventory in the expectation of orders from persons not resident in Canada or in connection with a hedge on a short sale to a person not resident in Canada, and

ii.  the corporation or partnership held, on 31 March 1998, a valid qualification certificate issued by the Minister of Finance in respect of its business and its trading in securities as a principal, for any of the taxation years or fiscal periods, as the case may be, that ended in the year 1998 or 1999, accounted for more than 90 % of all its activities carried out in that taxation year or fiscal period in the course of the operations of that business; and

(3)  the securities distribution shall be carried out only for or on behalf of

(a)  a foreign entity; or

(b)  the Government of Canada or the government of a province or a Canadian corporation, and directed at persons not resident in Canada.

1999, c. 86, s. 8; 2002, c. 9, s. 2.

CHAPTER III QUALIFICATION CERTIFICATES AND CERTIFICATES

DIVISION I CORPORATIONS AND PARTNERSHIPS

§ 1 . — Qualification certificates

9. A corporation or partnership that intends to operate an international financial centre within the territory of Ville de Montréal must obtain from the Minister a qualification certificate qualifying its business as an international financial centre, subject to the other provisions of this Act.

1999, c. 86, s. 9.

10. The Minister shall issue a qualification certificate to a corporation or partnership upon being satisfied that the activities engaged in or to be engaged in in the course of the business are in compliance with the provisions and objectives of this Act.

The qualification certificate shall indicate the categories of qualified international financial transactions engaged in or to be engaged in the course of the business.

The qualification certificate is valid only from the date indicated thereon.

1999, c. 86, s. 10.

§ 2 . — Certificates

11. A corporation or partnership holding, in a taxation year or fiscal period, a valid qualification certificate issued in respect of a business may file an application with the Minister for the issue of a certificate in respect of that business for that taxation year or fiscal period.

1999, c. 86, s. 11.

12. The Minister shall issue a certificate to a corporation or partnership where, for the taxation year or fiscal period,

(1)  the qualification certificate issued in respect of the business was valid ; and

(2)  the Minister is satisfied that the activities of the business were related to qualified international financial transactions.

The Minister may issue the certificate for a shorter period than the period indicated in the application.

1999, c. 86, s. 12.

DIVISION II EMPLOYEES ASSIGNED TO THE OPERATIONS OF AN INTERNATIONAL FINANCIAL CENTRE

§ 1 . — Qualification certificates

13. A corporation or partnership may file a written application with the Minister for the issue, in respect of one of its employees, of a qualification certificate required for the purpose of obtaining a tax benefit under Chapter V.

1999, c. 86, s. 13.

14. The Minister shall issue to a corporation or partnership a qualification certificate recognizing one of its employees as a foreign specialist upon being satisfied that the employee is a specialist in the field of international financial transactions and that it may reasonably be expected that

(1)  from the date on which the person becomes an employee of the corporation or partnership to the end of the period indicated on the qualification certificate,

(a)  the employee’s duties with the corporation or partnership will be devoted, in a proportion of at least 75 %, to the operations of a business of the corporation or partnership which constitutes or will constitute an international financial centre, other than back office activities, or

(b)  the employee will be a member of the strategic personnel of the business described in subparagraph a and the employee’s duties with the corporation or partnership will be devoted, in a proportion of at least 75 %, to the operations of the business ;

(2)  in the case of an individual who has become or is to become resident in Canada to establish an international financial centre of the corporation or partnership in Canada,

(a)  the individual’s duties with the person or partnership for which the individual is working during the period of establishment of the international financial centre are devoted, during that period, in a proportion of at least 75 %, to the establishment of the international financial centre,

(b)  the individual takes up employment as an employee of the corporation or partnership within 12 months after the day on which the individual becomes resident in Canada to establish the international financial centre of the corporation or partnership, and

(c)  from the date on which the individual takes up employment as an employee of the corporation or partnership to the end of the period indicated on the qualification certificate,

i.  the individual’s duties with the corporation or partnership are devoted, in a proportion of at least 75 %, to the operations of the business of the corporation or partnership that constitutes an international financial centre, other than back office activities, or

ii.  the individual is a member of the strategic personnel of the business described in subparagraph i and the individual’s duties with the corporation or partnership are devoted, in a proportion of at least 75 %, to the operations of the business.

The qualification certificate is valid only for the period indicated thereon, which must be established having regard to the provisions of section 69.

1999, c. 86, s. 14.

15. The Minister shall issue to a corporation or partnership a qualification certificate recognizing one of its employees as an employee, other than a foreign specialist, upon being satisfied that it may reasonably be expected that from the date or for the period indicated on the qualification certificate, the employee’s duties with the corporation or partnership are devoted, in a proportion of at least 75 %, to the operations of a business of the corporation or partnership which constitutes or will constitute an international financial centre.

The qualification certificate is valid only from the date or, as the case may be, for the period indicated thereon.

1999, c. 86, s. 15; 2002, c. 40, s. 2.

16. The Minister shall issue to a corporation or partnership a qualification certificate recognizing one of its employees as an eligible specialist upon being satisfied that

(1)  at the beginning of the period covered by the qualification certificate or, if a qualification certificate has previously been issued to an employer in respect of the employee under this section or for the purposes of Division II.6.9 of Chapter III.1 of Title III of Book IX of Part I of the Taxation Act (chapter I-3), at the beginning of the period covered by the first such qualification certificate issued to an employer in respect of that employee,

(a)  the employee has held, for no longer than 48 months, a university diploma in a subject relevant to the field of international financial transactions, or

(b)  the employee passed, no longer than 48 months previously, the first examination leading to chartered financial analyst (CFA) designation ; and

(2)  (subparagraph repealed);

(3)  it may reasonably be expected that a qualification certificate issued in respect of the employee pursuant to section 15 in relation to the employee’s employment with the corporation or partnership will also be valid for the period covered by the qualification certificate.

The qualification certificate is valid only for the period indicated thereon, which shall not exceed 36 months or, where a qualification certificate has previously been issued to an employer in respect of the employee under this section or for the purposes of Division II.6.9 of Chapter III.1 of Title III of Book IX of Part I of the Taxation Act, end after the 36-month period that began on the first day of the period covered by the first such qualification certificate issued to an employer in respect of the employee.

1999, c. 86, s. 16; 2002, c. 40, s. 3.

§ 2 . — Certificates

17. A corporation or partnership may file a written application with the Minister for the issue, in respect of one of its employees for a calendar year, of a certificate required for the purpose of obtaining a tax benefit under Chapter V.

1999, c. 86, s. 17.

18. An application must, where it relates to a tax benefit granted to an employee, be received by the Minister on or before the last day of February of the following calendar year.

However, the Minister may, where the Minister considers that the circumstances so warrant, allow that such an application be filed after the expiry of the prescribed time.

1999, c. 86, s. 18.

19. The Minister shall issue to a corporation or partnership a certificate recognizing one of its employees as a foreign specialist where, for the calendar year,

(1)  the qualification certificate issued to the corporation or partnership pursuant to section 14 in respect of the employee is valid,

(2)  the employee’s duties with the person or partnership referred to in subparagraph a of subparagraph 2 of the first paragraph of section 66 in respect of the employee were devoted, in a proportion of at least 75 %, to the establishment of the business which will constitute an international financial centre of the corporation or partnership,

(3)  subject to subparagraph 4, the employee’s duties with the corporation or partnership were devoted, in a proportion of at least 75 %, to the operations of a business of the corporation or partnership in respect of which a qualification certificate issued under section 10 was valid, other than back office activities, or

(4)  the employee’s duties with the corporation or partnership were devoted, in a proportion of at least 75 %, to the operations of the business described in subparagraph 3 and the employee was a member of the strategic personnel of the business.

The Minister shall forward a copy of the certificate to the employee.

1999, c. 86, s. 19.

20. The Minister shall issue to a corporation or partnership a certificate recognizing one of its employees as an employee other than a foreign specialist where, for the calendar year,

(1)  the qualification certificate issued to the corporation or partnership pursuant to section 15 in respect of the employee is valid, and

(2)  the employee’s duties with the corporation or partnership were devoted, in a proportion of at least 75 %, to the operations of a business of the corporation or partnership in respect of which a qualification certificate issued under section 10 was valid.

The Minister shall forward a copy of the certificate to the employee.

1999, c. 86, s. 20; 2002, c. 40, s. 4.

21. The Minister shall issue to a corporation or partnership a certificate recognizing one of its employees as an employee, other than a foreign specialist, who was an employee on 31 March 1998, where, throughout the period beginning on 1 January 1999 and ending at the end of the calendar year, the employee’s duties with the corporation or partnership were devoted, in a proportion of at least 75 %, to the operations of the business of the corporation or partnership, in the course of which the individual was employed on 31 March 1998 and in respect of which a qualification certificate issued under section 10 was valid.

The Minister shall forward a copy of the certificate to the employee.

1999, c. 86, s. 21.

22. The Minister shall issue to a corporation or partnership a certificate recognizing one of its employees as an eligible specialist where the qualification certificate issued to the corporation or partnership in respect of the employee pursuant to section 16 is valid for the calendar year and the certificate issued to the corporation or partnership in respect of the employee pursuant to section 20 is also valid.

1999, c. 86, s. 22.

23. The Minister may issue any certificate under this subdivision for a shorter period than the period indicated in the application.

1999, c. 86, s. 23.

DIVISION III AMENDMENTS AND REVOCATIONS

24. The Minister may amend a qualification certificate issued to a corporation or partnership pursuant to section 10 where information or documents brought to the attention of the Minister so warrant.

In such a case, the Minister shall send a notice of amendment to the corporation or partnership concerned.

1999, c. 86, s. 24.

25. The Minister may revoke the qualification certificate referred to in section 24 where

(1)  the Minister is of the opinion that the activities conducted by the corporation or partnership in the course of the business are no longer in compliance with the provisions or objectives of this Act, whether or not a contravention of the said provisions has occurred ; or

(2)  the corporation or partnership, knowingly or under circumstances amounting to gross negligence, has made a false statement or has omitted material information in an application for a qualification certificate or certificate filed under this chapter or in any other document filed for the purpose of obtaining such qualification certificate or certificate.

1999, c. 86, s. 25.

26. The Minister shall, upon revoking a qualification certificate pursuant to section 25, send to the corporation or partnership concerned, a notice of revocation indicating the date on which the revocation becomes effective. The effective date may precede the date of the notice but may not precede that date by more than four years. The qualification certificate is then deemed to cease to be valid from that date.

1999, c. 86, s. 26.

27. The Minister may amend or revoke a qualification certificate or certificate issued to a corporation or partnership in respect of one of its employees where information or documents brought to the attention of the Minister so warrant.

In such a case, the Minister shall send a notice of amendment or revocation to the corporation or partnership and, in the case of a certificate issued in respect of one of its employees pursuant to any of sections 19 to 21, the Minister shall send a copy of the notice to the employee.

1999, c. 86, s. 27.

28. Every qualification certificate or certificate amended pursuant to section 27 is deemed to have been issued under the same provision and at the same time as was the qualification certificate or certificate that has been amended.

1999, c. 86, s. 28.

29. The revocation of a qualification certificate or certificate pursuant to section 27 becomes effective on the date indicated in the notice of revocation. The effective date may precede the date of the notice but may not precede that date by more than four years. The qualification certificate or certificate is then deemed to cease to be valid from that date.

1999, c. 86, s. 29.

30. Where the Minister intends to amend or revoke a qualification certificate or certificate, the Minister shall inform the corporation or partnership concerned of such intention and of the grounds on which it is based. In such a case, the Minister shall give the corporation or partnership an opportunity to present observations within 30 days and, where required, to file relevant documents.

1999, c. 86, s. 30.

DIVISION IV INFORMATION AND VERIFICATION

31. The Minister may, before issuing a qualification certificate or certificate under this chapter or before amending or revoking such a document, require any relevant information or document and make any necessary verification.

The Minister may, for the same purposes, obtain the advice of CFI Montréal — Centre Financier International or of any other body pursuing similar objectives.

1999, c. 86, s. 31.

32. A person authorized by the Minister may, for the purposes of this chapter,

(1)  have access, at any reasonable time, to any place of business of a corporation or partnership ;

(2)  require and examine any relevant information or document and make copies thereof ;

(3)  require, where applicable, that relevant information or a copy of any relevant document be transmitted, in particular, by fax machine, electronic mail or on a computer-generated medium.

1999, c. 86, s. 32.

33. The person referred to in section 32 must, on request, produce identification and show the document attesting the person’s capacity, signed by the Minister.

1999, c. 86, s. 33.

34. No proceedings may be brought against a person referred to in section 32 for acts performed in good faith in conducting an inspection.

1999, c. 86, s. 34.

CHAPTER IV FINANCING

DIVISION I AMOUNTS PAYABLE

35. The Government may, by regulation, establish a tariff of the fees payable for the examination of an application for a qualification certificate or certificate under this Act or for the issue or amendment of such qualification certificate or certificate, and determine the terms and conditions of payment of the fees.

Fees must be paid to the Minister by the applicant or the holder on the date or dates fixed by the regulation.

1999, c. 86, s. 35.

36. The Minister may require that every holder of a qualification certificate or certificate issued under this Act pay an annual contribution to be applied to the financing of activities designed to promote Montréal as a centre for international financial activities and foster the development of Montréal as an international financial centre. The rate and terms and conditions of payment of the contribution shall be determined by regulation of the Government.

1999, c. 86, s. 36.

DIVISION II FONDS DU CENTRE FINANCIER DE MONTRÉAL

37. A fund to be known as the Fonds du centre financier de Montréal is hereby established to finance activities designed to promote Montréal as a centre for international financial activities and foster the development of Montréal as an international financial centre.

1999, c. 86, s. 37.

38. The Government shall determine the date of the beginning of the activities of the fund as well as the fund’s assets and liabilities. The Government shall also determine the nature of the activities financed by the fund and the nature of the costs that may be charged to it.

1999, c. 86, s. 38.

39. The fund shall be made up of the following sums, except interest :

(1)  the sums collected under sections 35 and 36 ;

(2)  the sums paid into it by a minister out of the appropriations granted for that purpose by Parliament ;

(3)  the sums paid into it by the Minister of Finance pursuant to section 41 and the first paragraph of section 42 ;

(4)  the gifts, legacies and other contributions paid into it to further the achievement of the objects of this division.

1999, c. 86, s. 39.

40. The management of the sums making up the fund shall be entrusted to the Minister of Finance. Such sums shall be paid to the order of the Minister of Finance and deposited with the financial institution designated by the Minister of Finance.

The Minister shall keep the books of account for and record the financial commitments chargeable against the fund. The Minister shall also ensure that the commitments and the payments arising therefrom do not exceed and are consistent with the available balances.

1999, c. 86, s. 40; 2000, c. 15, s. 158.

41. The Minister may, as the manager of the fund, borrow from the Minister of Finance sums taken out of the financing fund established under the Act respecting the Ministère des Finances (chapter M‐24.01).

1999, c. 86, s. 41; 2000, c. 15, s. 159.

42. The Minister of Finance may, with the authorization of the Government and subject to the conditions it determines, advance to the fund sums taken out of the consolidated revenue fund.

The Minister may, conversely, advance to the consolidated revenue fund, on a short-term basis and subject to the conditions the Minister determines, any part of the sums making up the fund that is not required for its operation.

Any advance paid into a fund shall be repayable out of that fund.

1999, c. 86, s. 42.

43. The Minister may, as the manager of the fund, grant a financial contribution directly to a government department or to a public or private body or pay such a contribution on behalf of a department to finance activities designed to promote Montréal as a centre for international financial activities or foster the development of Montréal as an international financial centre.

The Minister shall determine the date and the terms and conditions on which financial contributions are to be paid.

1999, c. 86, s. 43.

44. The sums required for the following purposes shall be taken out of the fund :

(1)  the payments of the sums referred to in section 43 ;

(2)  the payment of any expense necessary for the carrying out of the functions entrusted to the Minister by this division, including the payment of the remuneration and expenses pertaining to the employment benefits and other conditions of employment of the persons assigned, in accordance with the Public Service Act (chapter F‐3.1.1), to activities related to the fund.

1999, c. 86, s. 44.

45. The accumulated surplus of the fund shall be paid into the consolidated revenue fund on the dates and to the extent determined by the Government.

1999, c. 86, s. 45.

46. The provisions of sections 20, 21, 26 to 28, Chapters IV and VI and sections 89 and 90 of the Financial Administration Act (chapter A‐6.001) apply to the fund, with the necessary modifications.

1999, c. 86, s. 46; 2000, c. 8, s. 238; 2000, c. 15, s. 160.

47. The fiscal year of the fund ends on 31 March.

1999, c. 86, s. 47.

48. Notwithstanding any provision to the contrary, the Minister must, in the event of a deficiency in the consolidated revenue fund, pay out of the fund the sums required for the execution of a judgment against the State that has become res judicata.

1999, c. 86, s. 48.

CHAPTER V TAX INCENTIVES

DIVISION I DEFINITIONS AND GENERAL PROVISIONS

49. In this chapter,

“income” from a source means the income from that source, computed under Part I of the Taxation Act (chapter I‐3) ;

“loss” from a source means the loss from that source, computed under Part I of the Taxation Act ;

“taxable income” has the meaning assigned by Part I of the Taxation Act.

1999, c. 86, s. 49.

50. The Minister of Revenue may, for the purposes of this chapter, verify with the Ministère des Finances whether a particular activity or operation constitutes a qualified international financial transaction.

1999, c. 86, s. 50.

51. A person who, in a taxation year, is a corporation operating an international financial centre, or a member of a partnership that, at the end of a fiscal period of the partnership ending in that year, operates such a centre, or an individual entitled to a deduction for the year in computing the individual’s taxable income under section 65 or 71 shall enclose with the fiscal return required to be filed by the person for the year under section 1000 of the Taxation Act (chapter I‐3) a copy of the certificate that, where the person is that corporation or member, was issued for the year in respect of the person or partnership under section 12 or, where the person is that individual, that was issued for the year in respect of the individual under any of sections 19 to 21.

1999, c. 86, s. 51.

DIVISION II CORPORATIONS AND PARTNERSHIPS OPERATING AN INTERNATIONAL FINANCIAL CENTRE

§ 1 . — Taxable income

52. A person who, in a taxation year, is a corporation operating an international financial centre or a member of a partnership that, in a fiscal period of the partnership ending in that year, operates such a centre may deduct, in computing the person’s taxable income for the year, an amount not exceeding the part of the person’s income for the year that may reasonably be considered to be the amount by which

(1)  the aggregate of all amounts each of which is the person’s income for that year from the operations of an international financial centre operated by the person or the person’s share of the partnership’s income for that fiscal period from the operations of an international financial centre operated by the partnership, exceeds

(2)  the aggregate of all amounts each of which is the person’s loss for that year from the operations of an international financial centre operated by the person or the person’s share of the partnership’s loss for that fiscal period from the operations of an international financial centre operated by the partnership.

Where the corporation referred to in the first paragraph is a bank, within the meaning assigned by section 1 of the Taxation Act (chapter I-3), the amount that it may deduct for the year under the first paragraph is deemed to be equal to the proportion of the amount that, but for this paragraph, would be determined for the year in its respect under the first paragraph, that the aggregate of the business carried on in Canada or in Québec and elsewhere by the corporation in the year is of its business carried on in Québec in the year.

For the purposes of the second paragraph, the proportion of the business carried on in Canada, in Québec and in Québec and elsewhere by a corporation is computed in the manner prescribed in the regulations made under subsection 2 of section 771 of the Taxation Act, with the necessary modifications.

1999, c. 86, s. 52; 2002, c. 40, s. 5.

53. Where, in accordance with subsection 3 of section 33.1 of the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement), the person referred to in the first paragraph of section 52 has designated for a taxation year an office or branch located within the territory of Ville de Montréal as the place where an international banking centre business is to be carried on and the office or branch is, except as regards the conduct of transactions other than qualified international financial transactions, located at the place referred to in subparagraph 4 of the first paragraph of section 6, in respect of an international financial centre operated by the person, the aggregates referred to in subparagraphs 1 and 2 of the first paragraph of section 52 shall be determined as if

(1)  the person’s income for the year from the operations of the international financial centre were equal to the greater of the person’s income otherwise determined for the year from such operations and the amount of income in respect of that international banking centre that, pursuant to that section 33.1, is not required to be included in computing the person’s income for the year for the purposes of the Income Tax Act ; and

(2)  where the amount determined in paragraph 1 is positive, as if any loss for the year from the operations of the international financial centre were nil.

1999, c. 86, s. 53; 2002, c. 40, s. 6.

54. For the purposes of the first paragraph of section 52, where a person referred to therein for a taxation year is an individual to whom section 65 applies for the year and the fiscal period of the partnership that operates an international financial centre and of which the person is a member at the end of that fiscal period ends in the part of the reference period established in respect of the person under section 69 included in that year, the person’s share of the partnership’s income or loss for that fiscal period is deemed to be nil.

1999, c. 86, s. 54; 2002, c. 40, s. 7.

55. A person who, in a taxation year, is a corporation operating an international financial centre or a member of a partnership that, in a fiscal period of the partnership ending in that taxation year, operates such a centre shall include, in computing the person’s taxable income for the year, an amount equal to the amount by which the aggregate determined for the year in respect of the person under subparagraph 2 of the first paragraph of section 52 exceeds the aggregate determined for the year in respect of the person under subparagraph 1 of the first paragraph of that section.

However, the amount determined under the first paragraph for a taxation year in respect of a person shall in no case exceed the person’s income for the year, computed for the purposes of Part I of the Taxation Act (chapter I‐3) and without reference to any income or loss from the operations of an international financial centre operated by the person or the partnership in the year or fiscal period.

1999, c. 86, s. 55; 2002, c. 40, s. 8.

56. For the purposes of Title VII of Book IV of Part I of the Taxation Act (chapter I‐3), the non-capital loss, farm loss, net capital loss or limited partnership loss, for a taxation year, of a person who, in that year is a corporation that operates an international financial centre or a member of a partnership that, in a fiscal period of the partnership ending in that year, operates such a centre, shall be determined as if the person’s income or loss for the year from the operations of any international financial centre operated by the person and the person’s share of the partnership’s income or loss for the fiscal period from the operations of any international financial centre operated by the partnership were nil.

1999, c. 86, s. 56.

§ 2 . — Tax on capital

57. A corporation, other than an authorized foreign bank, within the meaning assigned by section 1 of the Taxation Act (chapter I‐3), that, in a taxation year, operates an international financial centre or is a member of a partnership that, in a fiscal period of the partnership ending in that year, operates such a centre may deduct, in computing its paid-up capital for the year, for the purposes of Part IV of that Act, any amount attributable to the operations of the international financial centre that the corporation has included in such computation, other than the amount referred to in section 59, and that is not otherwise deducted in such computation.

1999, c. 86, s. 57; 2004, c. 8, s. 1.

57.1. An authorized foreign bank, within the meaning assigned by section 1 of the Taxation Act (chapter I‐3), that, in a taxation year, operates an international financial centre, may deduct in computing its paid-up capital for the year, for the purposes of Part IV of that Act, the proportion of any amount attributable to the operations of that international financial centre that the authorized foreign bank included in that computation that the total of its business carried on in Canada or in Québec and elsewhere in the year is of its business carried on in Québec in the year.

For the purposes of the first paragraph, the computation of the business carried on in Canada, in Québec and in Québec and elsewhere by a corporation is computed in the manner prescribed in the regulations made under subsection 2 of section 771 of the Taxation Act, with the necessary modifications.

2004, c. 8, s. 2.

58. Where the deficit reported in the financial statements of a corporation referred to in section 1136, 1140, 1141 or 1141.1 of the Taxation Act (chapter I‐3) for a taxation year is less than the deficit that would be reported were it not for the operations of any international financial centre operated by the corporation directly or through a partnership, the corporation may also deduct, in computing its paid-up capital for the year, for the purposes of Part IV of that Act, the amount by which

(1)  the amount that would be the deficit of the corporation if the operations of any international financial centre operated by the corporation or partnership were not taken into account, exceeds

(2)  the amount deducted by the corporation in computing its paid-up capital under paragraph a of section 1137 of that Act or, but for this section and section 57, under section 1141.2 of that Act.

1999, c. 86, s. 58.

59. Where the deficit reported in the financial statements of a corporation referred to in section 1136, 1140, 1141 or 1141.1 of the Taxation Act (chapter I‐3) for a taxation year would be nil were it not for the operations of any international financial centre operated by the corporation directly or through a partnership, or where the amount of surplus or retained surpluses and earnings of the corporation reported in its financial statements for that year is less than the amount that would be reported were it not for those operations, the corporation must include in computing its paid-up capital for the year, for the purposes of Part IV of that Act, the lesser of

(1)  the amount that would be the deficit reported in the corporation’s financial statements for the year if only the operations of any international financial centre operated by the corporation or partnership were taken into account ; and

(2)  the amount by which the amount that would be the surplus or the retained surpluses and earnings of the corporation reported in its financial statements for the year if the operations of any international financial centre operated by the corporation or partnership were not taken into account, exceeds any amount included as retained surpluses or earnings by the corporation in computing its paid-up capital under paragraph b of subsection 1 of section 1136, paragraph c of section 1140 or 1141 or paragraph d of section 1141.1, as the case may be, of the Taxation Act.

1999, c. 86, s. 59.

60. A corporation may not deduct, in computing its paid-up capital for a taxation year for the purposes of Part IV of the Taxation Act (chapter I‐3), any part of an amount referred to in section 1137, 1141.2 or 1141.2.1 of that Act, except an amount referred to in section 57, that is attributable to the operations of an international financial centre operated in the year, directly or through a partnership, by the corporation.

1999, c. 86, s. 60.

60.0.1. An authorized foreign bank, within the meaning assigned by section 1 of the Taxation Act (chapter I‐3), may not, in computing its paid-up capital for a taxation year for the purposes of Part IV of that Act, deduct the part of the amount provided for in section 1141.2.1.1.1 of that Act, except an amount referred to in section 57.1, that is attributable to the operations of an international financial centre it operated in the year.

2004, c. 8, s. 3.

60.1. Where a corporation is a bank, within the meaning assigned by section 1 of the Taxation Act (chapter I-3), and operates for a taxation year an international financial centre, the corporation may deduct in computing its paid-up capital for the year, for the purposes of Part IV of that Act, the amount by which the proportion of the amount determined for the year in its respect under the second paragraph that the aggregate of the business carried on in Canada or in Québec and elsewhere by the corporation in the year is of its business carried on in Québec in the year, exceeds the amount determined for the year in its respect under that second paragraph.

The amount to which the first paragraph refers is equal to the amount by which the aggregate of the amount deducted by the corporation in computing its paid-up capital for the year under section 57 and the amount determined for the year in its respect under section 58, exceeds the aggregate of the amount determined for the year in respect of the corporation under section 59 and the part of the amount that the corporation may not deduct in computing its paid-up capital for the year under section 60.

For the purposes of the first paragraph, the proportion of the business carried on in Canada, in Québec and in Québec and elsewhere by a corporation is computed in the manner prescribed in the regulations made under subsection 2 of section 771 of the Taxation Act, with the necessary modifications.

2002, c. 40, s. 9.

61. A corporation is not required to pay the minimum amount of tax determined under section 1135, the second paragraph of section 1167 or the third paragraph of section 1173.1, as the case may be, of the Taxation Act (chapter I-3) where its operations consist solely in the operation, directly or through a partnership, of an international financial centre.

1999, c. 86, s. 61; 2002, c. 40, s. 10.

§ 3 . — Refundable tax credit

62. A person who, in a taxation year, is a corporation that operates an international financial centre or a member of a partnership that, in a fiscal period of the partnership ending in that year, operates such a centre, is deemed, as provided in any of Divisions II. 6.10 to II. 6.12 of Chapter III. 1 of Title III of Book IX of Part I of the Taxation Act (chapter I-3) where the conditions set out therein are satisfied for the year, to have paid to the Minister of Revenue on the person’s balance-due day, within the meaning of section 1 of that Act, for the year, on account of the person’s tax payable for that year under Part I of that Act, the amount determined in respect of the person for that year under that division

1999, c. 86, s. 62; 2001, c. 51, s. 318.

§ 4 . — Source deductions

63. No amount shall be deducted or withheld under section 1015 of the Taxation Act (chapter I‐3) in respect of the remuneration, for a period or part of a period of a taxation year, of an employee of a corporation or partnership operating an international financial centre, from the employee’s employment with the corporation or partnership, where the following conditions are satisfied :

(1)  except where section 104 applies for the period or part of the period in respect of the employee in relation to that employment, a qualification certificate had been issued pursuant to section 14 or 15 in respect of the employee in relation to that employment and is valid for that period or part of the period ;

(2)  where section 104 applies for that period or part of the period in respect of the employee in relation to that employment, a certificate had been issued for the preceding taxation year pursuant to any of sections 19 to 21 in respect of the employee in relation to that employment and is valid ; and

(3)  it may reasonably be considered that the conditions relating to that employment on which was based the decision of the Minister of Finance to issue the qualification certificate referred to in paragraph 1 or the certificate referred to in paragraph 2 remain essentially the same for the period or part of the period.

However, in the case of an employee to whom subparagraph 1 of the first paragraph applies by reason of a qualification certificate issued in respect of the employee pursuant to section 15 in relation to that employment, or to whom subparagraph 2 of the first paragraph applies by reason of a certificate issued in respect of the employee pursuant to section 20 or 21 in relation to that employment, the first paragraph applies only in respect of the part of the remuneration of the employee that corresponds to one-third of the employee’s wages, within the meaning of section 72, from that employment for the period or part of the period concerned.

1999, c. 86, s. 63.

§ 5 . — Québec health services fund

64. The wages paid by a corporation or partnership operating an international financial centre to one of the employees of the business of the corporation or partnership that constitutes the international financial centre does not constitute wages subject to the contribution provided for in section 34 of the Act respecting the Régie de l’assurance maladie du Québec (chapter R‐5) if the wages are attributable to

(1)  a period covered by a valid certificate issued pursuant to any of sections 19 to 21 in respect of the employee in relation to that employment; or

(2)  for any other period, the employee’s duties with the corporation or partnership that are devoted to the operations of the international financial centre.

1999, c. 86, s. 64; 1999, c. 89, s. 53.

DIVISION III EMPLOYEES ASSIGNED TO THE OPERATIONS OF AN INTERNATIONAL FINANCIAL CENTRE

§ 1 . — Foreign specialists

65. An individual described in section 66 may deduct, in computing the individual’s taxable income for a taxation year, an amount not exceeding the part of the individual’s income for the year, determined in accordance with section 28 of the Taxation Act (chapter I‐3), that may reasonably be considered to be earned during the part of the reference period established in respect of the individual under section 69 that is included in the year.

Where, in a taxation year, the individual is a member of a partnership, the individual’s share of the income or loss of the partnership for a fiscal period ending in the year shall be considered, for the purposes of the first paragraph, to be earned or sustained during the part of the year referred to therein if the fiscal period of the partnership ends in that part of the year, and to be earned or sustained during the other part of the year if the fiscal period ends during the other part of the year.

1999, c. 86, s. 65.

65.1. Where, at a particular time included in the reference period established under section 69 in respect of an individual described in section 66, the individual acquired a right to a security under an agreement referred to in section 48 of the Taxation Act (chapter I-3) and, at a later time after the expiration of the reference period, the individual is deemed to receive a benefit in a particular taxation year by reason of the application of any of sections 49 and 50 to 52.1 of that Act in respect of the security, or the transfer or any other disposition of the rights under the agreement, the following rules apply :

(a)  for the purposes of the first paragraph of section 65, the individual is deemed to be an individual described in section 66 for the particular taxation year ;

(b)  for the purposes of the first paragraph of section 65 and paragraphs a and b of section 737.18 of the Taxation Act, the amount of the benefit included by the individual in computing the individual’s income for the particular taxation year in respect of the security, or the transfer or any other disposition of the rights under the agreement, is deemed to be included in the part, referred to in that first paragraph, of the individual’s income for the particular taxation year ; and

(c)  for the purposes of section 71, the later time at which the individual is deemed to receive the benefit, the amount of which was included by the individual in computing the individual’s income for the particular taxation year in respect of the security, or the transfer or any other disposition of the rights under the agreement, is deemed to be included in a reference period established in respect of the individual under section 69.

2002, c. 40, s. 11.

66. Only an individual who meets the following requirements is entitled to a deduction under section 65 for a particular taxation year :

(1)  the individual took up employment, at a particular time, as an employee of a particular corporation or partnership operating an international financial centre ;

(2)  immediately before entering into a contract of employment or immediately before taking up employment as an employee of the particular corporation or partnership, the individual was not resident in Canada or, where the individual was resident in Canada at that time, the individual became resident in Canada at any time in the particular year or a preceding taxation year to establish an international financial centre in Canada and the following conditions are satisfied :

(a)  the individual worked, from that time to the time at which the condition set out in subparagraph c is satisfied, exclusively or almost exclusively for a person or partnership,

(b)  for any part of the period referred to in subparagraph a, the individual held a valid certificate issued in respect of the individual pursuant to section 19 in relation to the establishment of the international financial centre, and

(c)  the individual took up employment, within 12 months after that time, as an employee of the particular corporation or partnership that operates the international financial centre established by the individual,

(3)  the individual has, from the particular time to any time in the particular year, worked exclusively or almost exclusively for the particular corporation or partnership, and

(4)  for any part of the period beginning at the particular time and ending at any time in the particular year, the individual held a valid certificate issued in respect of the individual pursuant to section 19 in relation to that employment.

For the purposes of subparagraph 4 of the first paragraph, the business to which a certificate referred to therein relates must be an international financial centre of the particular corporation or partnership.

1999, c. 86, s. 66.

67. For the purposes of section 66, where an individual is resident in Canada immediately before entering into a new contract of employment, subsequent to a contract of employment entered into with the particular corporation or partnership and referred to in that section, with an employer that is the particular corporation or partnership or another corporation or partnership operating an international financial centre and, immediately before taking up employment as an employee of such an employer pursuant to the new contract of employment,

(1)  the new contract of employment is deemed not to be a contract of employment separate from the contract of employment entered into with the particular corporation or partnership and referred to in section 66 or from any contract of employment subsequent to the latter contract but prior to the new contract of employment and entered into with a corporation or partnership operating an international financial centre ;

(2)  where the employer is the other corporation or partnership, the other corporation or partnership is deemed not to be a corporation or partnership separate from the particular corporation or partnership or from another corporation or partnership operating an international financial centre and having employed the individual under a contract of employment subsequent to the contract entered into with the particular corporation or partnership and referred to in that section 66 but prior to the new contract of employment ; and

(3)  for the period, if any, during which the individual is in the employ of both the particular corporation or partnership and the other corporation or partnership,

(a)  the rules set out in paragraphs 1 and 2 apply only for the part of that period in which all the activities of the international financial centres of those corporations or partnerships are conducted in one place within the territory of Ville de Montréal, and

(b)  the condition set out in subparagraph 4 of the first paragraph of section 66 must be satisfied in respect of each of those corporations or partnerships in relation to its international financial centre.

1999, c. 86, s. 67.

68. For the purposes of subparagraph 3 of the first paragraph of section 66, an individual who, at any time, works exclusively or almost exclusively for a group of corporations or partnerships each of which is operating an international financial centre, including the particular corporation or partnership referred to in that section, is deemed, except where section 67 applies, to be working at that time exclusively or almost exclusively for the particular corporation or partnership if, at that time,

(1)  all the activities of those international financial centres are conducted in one place within the territory of Ville de Montréal ; and

(2)  the condition set out in subparagraph 4 of the first paragraph of section 66 is satisfied as regards each of those corporations or partnerships in relation to its international financial centre.

1999, c. 86, s. 68.

69. The reference period in respect of an individual described in section 66 is the period

(1)  that begins on the earlier of

(a)  the day on which the individual took up employment as an employee or, where section 67 applies, took up employment as an employee for the first time, of the particular corporation or partnership referred to in section 66, and

(b)  where applicable, the day on which the individual became resident in Canada to establish an international financial centre in Canada ;

(2)  throughout which

(a)  the individual is working to establish an international financial centre or is in the employ of a corporation or partnership operating such a centre, and

(b)  the following conditions are satisfied :

i.  the conditions set out in subparagraphs a and b of subparagraph 2 of the first paragraph of section 66, while the individual is working to establish an international financial centre, and

ii.  the conditions set out in subparagraphs 3 and 4 of the first paragraph of section 66, where the individual is in the employ of a corporation or partnership operating an international financial centre ; and

(3)  that, added to any preceding period established in respect of the individual under this section or the regulations under the first paragraph of section 737.16 of the Taxation Act (chapter I‐3), as they read for a taxation year beginning on or before 20 December 1999, does not exceed 60 months.

1999, c. 86, s. 69.

70. For the purposes of Title VII of Book IV of Part I of the Taxation Act (chapter I‐3), the non-capital loss, farm loss, net capital loss, restricted farm loss and limited partnership loss, for a taxation year, of an individual who, for that year, benefits from a deduction under section 65, shall be determined as if the individual’s income throughout the reference period established in respect of the individual under section 69 and any loss throughout that period were nil.

1999, c. 86, s. 70.

§ 2 . — Other employees

71. An individual who holds an employment with a particular corporation or partnership operating an international financial centre may deduct, in computing the individual’s taxable income for a taxation year, an amount not exceeding one-half of the part of the individual’s wages from that employment for the year that may reasonably be attributed to a qualifying period established in respect of the individual under section 73 in relation to the particular corporation or partnership, except any part of that period that is included in the reference period established in respect of the individual under section 69.

1999, c. 86, s. 71; 2002, c. 40, s. 12.

72. In section 71, an individual’s wages for a taxation year from an employment means the individual’s income for the year from that employment, computed under Chapters I and II of Title II of Book III of Part I of the Taxation Act (chapter I‐3) with every deduction under Division III of Chapter III of that Title II being taken into account.

1999, c. 86, s. 72.

73. For the purposes of section 71, a particular period included in a particular calendar year and in respect of which the following conditions are satisfied is a qualifying period in respect of an individual in relation to a particular corporation or partnership :

(1)  the individual worked throughout the particular period exclusively or almost exclusively

(a)  for the particular corporation or partnership, or

(b)  for a group of corporations or partnerships each of which was operating an international financial centre, including the particular corporation or partnership, where all the activities of those international financial centres are conducted in one place within the territory of Ville de Montréal ;

(2)  the individual held a valid certificate covering the whole of the particular period which was issued in respect of the individual to each corporation or partnership that is the particular corporation or the particular partnership or, where applicable, any of the other corporations or partnerships referred to in subparagraph b of paragraph 1, in relation to the individual’s employment with the corporation or partnership,

(a)  pursuant to section 20, or

(b)  pursuant to section 21, in the case of an individual

i.  who was in the employ of the corporation or partnership from 31 March 1998 to the end of the particular period,

ii.  who would have been entitled, if the provisions of Title VII.2 of Book IV of Part I of the Taxation Act (chapter I‐3) had read for the taxation year 1998 as they read for the taxation year 1997, to a deduction under section 737.16.1 of that Act for the taxation year 1998 in relation to the individual’s remuneration from that employment for a period including 31 March 1998, and

iii.  whose duties with that corporation or partnership were devoted, at all times from 1 April 1998 to 31 December 1998, in a proportion of at least 75 %, to the operations of the international financial centre of that corporation or partnership in the course of which the individual was employed on 31 March 1998, and

(3)  the business to which the certificate referred to in paragraph 2 relates is, throughout the particular period, an international financial centre of the corporation or partnership referred to therein.

1999, c. 86, s. 73.

DIVISION IV OTHER PROVISION

74. This chapter is a fiscal law within the meaning of the Act respecting the Ministère du Revenu (chapter M‐31).

1999, c. 86, s. 74.

CHAPTER VI AMENDING PROVISIONS

TAXATION ACT

75. (Amendment integrated into c. I-3, s. 1).

1999, c. 86, s. 75.

76. (Amendment integrated into c. I-3, s. 733.0.1).

1999, c. 86, s. 76; 2004, c. 21, s. 549.

77. (Omitted).

1999, c. 86, s. 77; 2004, c. 21, s. 550.

78. (Amendment integrated into c. I-3, s. 737.14).

1999, c. 86, s. 78; 2004, c. 21, s. 551.

79. (Omitted).

1999, c. 86, s. 79.

80. (Amendment integrated into c. I-3, ss. 737.16-737.16.1).

1999, c. 86, s. 80; 2002, c. 9, s. 178.

81. (Amendment integrated into c. I-3, s. 737.17).

1999, c. 86, s. 81; 2004, c. 21, s. 552.

82. (Amendment integrated into c. I-3, s. 737.18).

1999, c. 86, s. 82.

83. (Amendment integrated into c. I-3, s. 772.2).

1999, c. 86, s. 83.

84. (Amendment integrated into c. I-3, s. 1029.6.0.1).

1999, c. 86, s. 84.

85. (Amendment integrated into c. I-3, ss. 1029.8.36.102-1029.8.36.124).

1999, c. 86, s. 85.

86. (Amendment integrated into c. I-3, s. 1089).

1999, c. 86, s. 86.

87. (Amendment integrated into c. I-3, s. 1090).

1999, c. 86, s. 87.

88. (Amendment integrated into c. I-3, s. 1091).

1999, c. 86, s. 88.

89. (Amendment integrated into c. I-3, ss. 1129-45.17-1129.45.26).

1999, c. 86, s. 89.

90. (Amendment integrated into c. s. 1135).

1999, c. 86, s. 90.

91. (Amendment integrated into c. s. 1136).

1999, c. 86, s. 91.

92. (Amendment integrated into c. I-3, s. 1137).

1999, c. 86, s. 92.

93. (Amendment integrated into c. I-3, s. 1137.0.0.1).

1999, c. 86, s. 93.

94. (Amendment integrated into c. I-3, s. 1141.1.1).

1999, c. 86, s. 94.

95. (Amendment integrated into c. I-3, s. 1141.2).

1999, c. 86, s. 95.

96. (Amendment integrated into c. I-3, s. 1141.2.1.1).

1999, c. 86, s. 96.

97. (Amendment integrated into c. I-3, s. 1141.2.4).

1999, c. 86, s. 97.

98. (Amendment integrated into c. s. 1167).

1999, c. 86, s. 98.

99. (Amendment integrated into c. I-3, ss. 737.19, 737.22.0.1, 752.0.10, 767, 772.7, 772.9, 772.11).

1999, c. 86, s. 99.

ACT RESPECTING THE RÉGIE DE L’ASSURANCE-MALADIE DU QUÉBEC

100. (Amendment integrated into c. R-5, s. 33).

1999, c. 86, s. 100.

101. (Amendment integrated into c. R-5, s. 34.1.4).

1999, c. 86, s. 101.

102. (Omitted).

1999, c. 86, s. 102.

CHAPTER VII MISCELLANEOUS PROVISIONS

103. Every qualification certificate or certificate provided for in Title VII.2 of Book IV of Part I of the Taxation Act (chapter I‐3) or in Division II.6.11 of Chapter III.1 of Title III of Book IX of Part I of that Act and issued by the Minister to a corporation or partnership for the purposes of the application of that Title VII.2 or of that Division II.6.11 to a taxation year or fiscal period beginning on or before 20 December 1999 is deemed to be provided for in this Act and to have been issued in accordance with the section of this Act pursuant to which the qualification certificate or certificate would have been issued if that section had been in force.

1999, c. 86, s. 103.

104. The Minister is deemed to have issued, pursuant to section 14 or 15, a qualification certificate, valid at any particular time, to a corporation or partnership in respect of one of its employees where the employee

(1)  was in the employ of the corporation or partnership on 31 December 1999 or, as the case may be, was working on that date for the person or partnership referred to in subparagraph a of subparagraph 2 of the first paragraph of section 66 in respect of the employee ; and

(2)  was holding a valid certificate issued to the corporation or partnership in respect of the employee for the taxation year 1999 and each subsequent taxation year ending before the particular time, pursuant to section 19, in the case of section 14, or pursuant to section 20 or 21, in the case of section 15.

1999, c. 86, s. 104.

105. Section 6 shall, for a taxation year, a fiscal period or a calendar year that begins on or before 20 December 1999, be read as follows :

“6. In this Act, “ international financial centre ” has the meaning assigned by sections 737.13 and 737.13.1 of the Taxation Act (chapter I‐3).”

1999, c. 86, s. 105.

106. For the purpose of determining after 31 December 1999 whether an individual satisfies the condition set out in subparagraph b of subparagraph 2 of the first paragraph of section 66, or in subparagraph 4 of that paragraph, in respect of the part of a particular period prior to 1 January 2000, the obligation to hold, for that part of the particular period, a valid certificate issued in respect of the individual pursuant to section 19 in relation to the establishment of an international financial centre or in relation to the individual’s employment, must be replaced by the following obligation :

(1)  as regards the condition set out in subparagraph b of subparagraph 2 of the first paragraph of section 66, the individual’s duties with the person or partnership referred to in subparagraph a of that subparagraph 2 were devoted

(a)  for the part of the particular period prior to 1 January 1998, exclusively or almost exclusively to the establishment of an international financial centre,

(b)  for the part of the particular period subsequent to 31 December 1997 but prior to 1 January 1999, in a proportion of at least 75 %, to the establishment of an international financial centre, or

(c)  for the part of the particular period subsequent to 31 December 1998, in a proportion of at least 75 %, to the establishment of an international financial centre, as confirmed by the Minister in the certificate provided for in subparagraph f of the second paragraph of section 737.15 of the Taxation Act (chapter I-3), as it read for a taxation year beginning on or before 20 December 1999 ; and

(2)  as regards the condition set out in subparagraph 4 of the first paragraph of section 66, the individual’s duties with the particular corporation or partnership referred to in that section were devoted

(a)  for the part of the particular period prior to 1 January 1998, exclusively or almost exclusively to the operations of the international financial centre of that corporation or partnership,

(b)  for the part of the particular period subsequent to 31 December 1997 but prior to 1 January 1999,

i.  in a proportion of at least 75 %, to the operations of the international financial centre of that corporation or partnership other than, after 31 March 1998, back office activities, or

ii.  in a proportion of at least 75 %, to the operations of the international financial centre of that corporation or partnership, where the individual was a member of the strategic personnel of the international financial centre, or

(c)  for the part of the particular period subsequent to 31 December 1998, as confirmed by the Minister in the certificate described in subparagraph c of paragraph 1,

i.  in a proportion of at least 75 %, to the operations of a business of that corporation or partnership, in respect of which a qualification certificate provided for in paragraph f of the definition of “international financial centre” in section 737.13 of the Taxation Act, as it read before being repealed was valid, other than back office activities, or

ii.  in a proportion of at least 75 %, to the operations of the business described in subparagraph i, where the individual was a member of the strategic personnel of the business.

For the purposes of subparagraph c of subparagraph 2 of the first paragraph, the business to which a certificate referred to therein is related must constitute an international financial centre of the particular corporation or partnership.

1999, c. 86, s. 106.

107. Paragraph 3 of section 67 and section 68 do not apply in respect of a period or time prior to 1 January 1998.

1999, c. 86, s. 107.

108. Where the day, referred to in this section as the “particular day”, which corresponds to the earlier of the day on which an individual, for the first time, became an employee of a corporation operating an international financial centre and, where applicable, of the day on which, for the first time, the individual became resident in Canada to establish an international financial centre in Canada, is prior to 1 April 1996, the reference period established in respect of the individual under section 69

(1)  shall be established, where the particular day is prior to 1 April 1994, as if that section were read as if “60 months” in paragraph 3 were replaced by “24 months” ;

(2)  is deemed to correspond, where the particular day is subsequent to 31 March 1994, to the aggregate of

(a)  the period that would be established in respect of the individual under that section 69 but for this section and if that section 69 were read as if “60 months” in paragraph 3 were replaced by “24 months”, and

(b)  the part of the period that would be established in respect of the individual under that section 69 but for this section, that is not included in the period referred to in subparagraph a and is neither prior to 1 April 1998 nor later than the day preceding the day that is five years after the particular day;

(3)  (paragraph repealed).

1999, c. 86, s. 108; 2001, c. 51, s. 319.

109. The Minister of Finance is responsible for the administration of this Act, except Chapter V which comes under the administration of the Minister of Revenue.

1999, c. 86, s. 109.

The Minister of Finance exercises the functions of the Minister of Revenue provided for in this Act. Order in Council 1689-2022 dated 26 October 2022, (2022) 154 G.O. 2 (French), 6581.

110. Chapters III and V apply to taxation years, fiscal periods or calendar years that begin after 20 December 1999.

1999, c. 86, s. 110.

111. The first regulation made under sections 35 and 36 is not subject to the publication requirement or the time limits fixed for its coming into force that are provided for in sections 8 and 17 of the Regulations Act (chapter R‐18.1). If the regulation is made after 1 January 2000, it will come into force on the date of its publication in the Gazette officielle du Québec and may apply to a period prior to its publication but not prior to 1 January 2000.

1999, c. 86, s. 111.

112. Division II of Chapter IV has effect from 1 April 1999. The order made before 31 March 2000 pursuant to section 38 may have effect from that same date.

1999, c. 86, s. 112.

113. (Omitted).

1999, c. 86, s. 113.

REPEAL SCHEDULE

In accordance with section 9 of the Act respecting the consolidation of the statutes and regulations (chapter R-3), chapter 86 of the statutes of 1999, in force on 1 April 2000, is repealed, except subsection 2 of section 75, subsections 2 and 3 of section 76, subsections 2 to 6 of section 77, subsections 2 to 4 of sections 78 to 80, subsections 2 and 3 of section 81, subsection 2 of section 82, subsections 2 and 3 of sections 83 and 84, subsection 2 of section 85, subsections 2 and 3 of sections 86 and 87, subsection 2 of sections 88 and 89, subsections 2 and 3 of section 90, subsection 2 of sections 91 to 96, subsections 2 and 3 of sections 97 to 99, subsection 2 of section 100, subsections 2 and 3 of section 101 as well as sections 102 and 113, effective from the coming into force of chapter C-8.3 of the Revised Statutes.