I-3, r. 1 - Regulation respecting the Taxation Act

Section 359.1r4.1 Disposition versions

2016-02-17

359.1R4.1. For the purposes of the first paragraph of section 359.1 of the Act, a new right to acquire a share of the capital stock of a corporation is a prescribed right if

(a)  the consideration for which the new right is to be issued is to be determined more than 60 days after entering into the agreement pursuant to which the new right is to be issued;

(b)  the corporation or a specified person in relation to the corporation, directly or indirectly, for the purpose of assisting any person or partnership in acquiring the new right or an interest in a partnership acquiring the new right, otherwise than by reason of an excluded obligation in relation to the right,

i.  provided assistance,

ii.  made or arranged for a loan or payment,

iii.  transferred property, or

iv.  otherwise conferred a benefit by any means whatever, including the payment of a dividend; or

(c)  the holder of the new right or, where the holder is a partnership, a member thereof, is entitled under any agreement or arrangement entered into under circumstances where it is reasonable to consider that the agreement or arrangement was contemplated at or before the time the agreement to issue the new right was entered into

i.  to dispose of the new right, and

ii.  through a transaction or event or a series of transactions or events contemplated by the agreement or arrangement, to acquire

(1)  a share, referred to in this subparagraph as the “acquired share”, of the capital stock of another corporation that would be a prescribed share under section 359.1R3 if the acquired share had been issued at the time the new right was issued, other than a share that would not be a prescribed share if that section were read without reference to subparagraph iv of paragraph a and subparagraphs i and ii of paragraph d where the acquired share is a share of a mutual fund corporation or of a corporation that becomes a mutual fund corporation within 90 days after the acquisition of the acquired share; or

(2)  a right, referred to in this subparagraph as the “acquired right”, to acquire a share of the capital stock of another corporation that would be a prescribed right if it had been issued at the time the new right was issued, other than a right that would not be a prescribed right if section 359.1R3.1 were read without reference to subparagraph i of paragraph e where the acquired right is a right to acquire a share of the capital stock of a mutual fund corporation or of a corporation that becomes a mutual fund corporation within 90 days after the acquisition of the acquired right.

O.C. 66-2016, s. 12.