I-3 - Taxation Act

Section 1049.14.16 Disposition versions

2006-06-13

1049.14.16. If, on 31 December in a particular year, as a result of the administration of a qualified mutual fund by a manager or trustee, the qualified mutual fund is unable to fulfill its undertaking under paragraph a of section 965.121 in respect of a public security issue made by the qualified mutual fund in the year preceding the particular year, the manager or trustee incurs a penalty equal to 25% of the proportion of the amount by which the portion, which is the subject of the undertaking under that paragraph a, of the proceeds for the year preceding the particular year, of the public security issue exceeds the greater of the particular amount referred to in paragraph c of that section in respect of the year preceding the particular year and the cost, determined without reference to the borrowing costs, brokerage or custody fees or other similar costs, to the qualified mutual fund, of the aggregate of the qualifying shares described in that paragraph a acquired by the qualified mutual fund during the particular year or the year preceding that year with the proceeds of the public security issue, other than any such qualifying shares having already been used, in respect of the particular year or the year preceding that year, for the purposes of paragraph c of section 965.121, as is represented by the ratio that the portion of the proceeds, for the year preceding the particular year, of the public security issue derived from the issue of qualifying securities is of the proceeds of the issue.

2006, c. 13, s. 202.