Investing in Canada

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Investing in Canada, Practical Law Country Q&A w-021-4471
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Investing in Canada
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by\u160\'3fElizabeth Breen, Steven D Bennett, John Lee and Debbie Wang,
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Stikeman Elliott LLP
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Country Q&A |
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Law stated as at 01-Jul-2020
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| Canada
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A Q&A guide to investing in Canada.
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This Q&A gives an overview of the key factors affecting inward investment,
including information on the jurisdiction\rquote s legal system; key laws and
regulatory authorities; investment restrictions; and details of international
treaties, customs and monetary unions. The guide also provides information on
investor individuals; visa permits; restrictions on foreign ownership; transfer
pricing and thin capitalisation rules; imports and import duties; safety
regulations and standards for commercial goods and services; structuring and tax
incentives; investment guarantees; recent developments and proposals for reform.
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To compare answers across multiple jurisdictions, visit the Investing in...
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This Q&A is part of the Investing in\u8230\'3fGlobal Guide. For a full list of
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The market
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Legal system
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Investor individuals
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Investment restrictions
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Imports
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Structuring and tax
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Incentives
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Investment guarantees
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Recent developments and proposals for reform
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Elizabeth Breen, Partner
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The market
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1.
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How does your jurisdiction compare internationally as a destination for inward
investment?
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Canada is an attractive destination for inward investment for several reasons,
including:
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Its stable and democratic political, legal and financial systems.
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Its business-friendly legal and political environment.
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The competitive tax rates.
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The high standard of living.
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The highly educated and experienced workforce.
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The primarily duty-free manufacturing tariff regime.
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Several reports also identify Canada as an attractive place for inward investment,
as follows:
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The
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United Nations Conference on Trade and Development (UCTAD): World Investment Report
2018
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ranked Canada as the 15th most popular destination for foreign direct investment in
the world in 2017.
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Canada was ranked 18th out of 190 countries in the
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World Bank: Doing Business 2018
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report.
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It was ranked 6th out of 153 countries as a place to do business in
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Forbes\rquote : Best Countries for Business 2018
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report.
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The
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Economist Intelligence Unit 2019 publication
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predicted that Canada would be the best country in both the G7 and G20 for doing
business over the five-year period from 2019 to 2023.
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The
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KPMG: Competitive Alternatives 2016
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study by identified Montreal, Toronto and Vancouver as the most cost-competitive
major business centres in the G7 countries. At a sectoral level, KPMG found that
Canada had the lowest costs of any G7 country in 18 of 19 industries studied,
including aerospace, agri-food, automotive, chemicals, clinical trial
administration, digital entertainment, electronics, green energy, medical devices,
metal components, pharmaceuticals, plastics, precision manufacturing, product
testing, professional services, software design, support services and
telecommunications.
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2.
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What types of companies are attracting foreign investment into your jurisdiction
and what are the most active sectors?
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Manufacturing was the top sector for foreign investment in 2017 (according to
}
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Global Affairs Canada: Canada\rquote s State of Trade: Trade and Investment Update
- 2018
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).
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Other major sectors for foreign investment include:
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Management of companies and enterprises.
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Mining and oil and gas extraction.
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Finance and insurance.
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{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Wholesale trade.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Retail trade.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The cannabis sector in Canada is experiencing rapid growth in response to the
country\rquote s legalisation of recreational cannabis in 2018. In that year,
cannabis deal volume in Canada rose by over 600% compared to the previous year,
based on deal value (from USD1.27 billion in 2017 to USD9 billion in 2018). This
accounted for 73% of transactions within the global cannabis sector, based upon
deal value.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The artificial intelligence and financial technology sectors are also experiencing
extensive investment growth. In 2018, there were 119 transactions in Canada in the
financial technology sector, representing an aggregate transaction value of CAD1.2
billion. Recent investments in the artificial intelligence sector include:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Uber\rquote s establishment of the Advanced Technology Group in Toronto to further
its research in self-driving technology.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Google\rquote s investment in the Montreal Institute for Learning Algorithms and a
research centre for deep learning.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Microsoft\rquote s acquisition of Maluuba, a Canadian start-up specialising in
machine language understanding.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
3.
}
}
What will be the main factors affecting the market and how do you expect the market
to develop?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
According to
}
{\b0 \cf1 \f2 \i1 \fs20
economiste/performance/index.aspx?lang=eng" }{\fldrslt
Global Affairs Canada: Canada\rquote s State of Trade: Trade and Investment Update
- 2018
}}}
}
, Canadian foreign direct investment will continue to be affected by ongoing
uncertainty around both:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The North American Free Trade Agreement (NAFTA) renegotiation process (which has
now given rise to its successor treaty, the United States Mexico Canada Agreement
(USMCA)), and its ratification process.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The rules-based multilateral trading system of international exchange that promotes
open, fair and undistorted competition, which has been increasingly replaced by
bilateral and regional trade agreements.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Royal Bank of Canada\rquote s Economics division, in their
}
{\b0 \cf1 \f2 \i1 \fs20
{\field {\*\fldinst HYPERLINK "http://www.rbc.com/economics/economic-
reports/pdf/other-reports/RBC-Economics-outlook2019.pdf?
promo_name=ThoughtLeadership&promo_id=197320&promo_position=body&_ga=2.37745248.171
4404169.1546526825-1701045046.1537191533" }{\fldrslt
Navigating 2019 report
}}}
}
notes that, in particular, a full-blown trade conflict between the US and China
would have immediate negative impacts on the Canadian economy, through stock market
volatility and tariffs increasing the cost of goods. However, it also predicts that
Canada\rquote s global economic competitiveness in the upcoming year may increase
due to a combination of:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Tax measures introduced in the Canadian government\rquote s Fall Economic
Statement, which includes accelerated deductions of capital expenses.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Canada\rquote s low corporate tax rate, which remains the third lowest in the G7.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
See
}
{\b0 \cf1 \f2 \i1 \fs20
Question 30
}}}
.
\par
}
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
While the outcome of the USMCA ratification process and tariff disputes with the
current US administration cannot be predicted with certainty, Canada\rquote s
economic trade links are increasingly diversified. Its USMCA counterparties, the US
and Mexico, are two of many countries with which Canada has concluded or
implemented trade agreements, including:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The recent landmark EU-Canada Comprehensive Economic and Trade Agreement (CETA),
which became effective in 2017.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A revised Trans-Pacific Partnership agreement implemented in 2018.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Bilateral agreements with Chile, Colombia, Costa Rica, Israel, Jordan, Panama,
Peru, South Korea and Ukraine.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada is, as at the law-stated date of this Q&A, actively pursuing a trade
agreement with Argentina, Brazil, Paraguay, Uruguay and Honduras among others.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
For more information concerning the trade agreements to which Canada is a party,
see
}
{\b0 \cf1 \f2 \i1 \fs20
Question 7
}}}
.
\par
}
}
}
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
}
\u160\'3f
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs28 \li0
Legal system
\par
}
}
\u160\'3f
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
4.
}
}
What are the constitutional arrangements and legal system.
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Constitutional arrangements
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada is a parliamentary democracy, a federal state and a constitutional monarchy.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Parliamentary democracy.
}
}
Canada has a parliamentary form of government. The national parliament, which sits
in Ottawa, includes an upper and a lower chamber, that is, the Senate and the House
of Commons, respectively.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Senate, whose membership is appointed to age 75, plays a relatively limited
part in the political process. Real legislative power rests almost exclusively in
the elected House of Commons, whose 338 members are known as Members of Parliament
or MPs. MPs represent single-member geographical constituencies, which Canadians
often call \ldblquote ridings\rdblquote . Typically, the political party with the
largest number of MPs in the House of Commons forms the Government.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Prime Minister (the political leader of the country) is the MP chosen to be
leader by the political party then in power. Executive power is concentrated in the
Federal Cabinet, whose members include the Prime Minister and other MPs chosen by
the Prime Minister to head the various departments of the Federal Government.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Federal state.
}
}
Canada is a federal state in which legislative authority is constitutionally
divided between one national and 13 local jurisdictions. Canada\rquote s ten
principal local jurisdictions are known as provinces. Three local jurisdictions
located along Canada\rquote s northern border are known as territories. The
governments of these three sparsely populated northern territories exercise many of
the powers of provincial governments. In addition, the provinces and territories
delegate certain powers to cities, towns, and other municipalities, effectively
creating a third level of government.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The governments of the provinces are generally similar in form to the Federal
Government, although the provinces have unicameral parliaments and generally use
different names for their political entities, such as Legislative Assembly (for
Parliament), Premier (for Prime Minister), and MLA (for MP).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Constitutional monarchy.
}
}
Canada is a constitutional monarchy, although Canada\rquote s continuing
recognition of Queen Elizabeth II as head of state has more symbolic than practical
significance. The Queen\rquote s ceremonial functions in Canadian public life are
primarily performed by her Canadian representative, the Governor General of Canada.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Legal system
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Two distinct legal systems exist in Canada:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
In the largely French speaking Province of Qu\u233\'3fbec, private law is
established by a Civil Code, which is conceptually similar to that of France and
other continental European countries.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The other provinces and territories are common law jurisdictions. While
historically the common law provinces of Canada have been inclined to attach more
importance to British than American jurisprudence as its precedent, in recent years
American caselaw has become increasingly more influential with Canadian courts and
legislators, particularly with respect to commercial and business matters.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
5.
}
}
What are the key laws and regulatory authorities governing foreign investment in
your jurisdiction?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Investment Canada Act (ICA) is federal legislation governing foreign direct
investment in Canada. The ICA allows the Federal Government to screen very large
proposed foreign investments to ensure that they are likely to produce a \ldblquote
net benefit to Canada\rdblquote , in contrast to its predecessor, which required
a \ldblquote significant benefit to Canada\rdblquote . Although \ldblquote net
benefit to Canada\rdblquote is not defined in the ICA, in determining whether an
investment is of a \ldblquote net benefit to Canada\rdblquote , the Minister of
Innovation, Science and Economic Development (or Minister of Canadian Heritage for
cultural transactions) (Minister) will consider factors such as:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The effect of the investment on the level and nature of economic activity in
Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The degree and significance of participation by Canadians in the Canadian business
and the relevant Canadian industry.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The effect of the investment on productivity, industrial efficiency, technological
development, product innovation and product variety in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The effect of the investment on competition within any industry in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The compatibility of the investment with national industrial, economic and cultural
policies.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The effect of the investment on Canada\rquote s ability to compete in world
markets.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
An acquisition of control of a Canadian business by a \ldblquote non-
Canadian\rdblquote is subject to the provisions of the ICA, even where the
Canadian business is already foreign controlled (for example, a Canadian subsidiary
of a US corporation). However, the vast majority of transactions fall under the
financial thresholds, which vary according to the identity of the acquirer, such
that they do not acquire a \ldblquote net benefit to Canada\rdblquote approval.
The practical effect is that the only filing obligation under the ICA for most
transactions is to file a simple notification, which may be done on a post-closing
basis.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Whether a foreign investment is subject either to advance review and approval by
the Minister of Innovation, Science and Economic Development (or Minister of
Canadian Heritage for cultural transactions) under the net benefit test, or only to
a post-closing notice, depends on the:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Nationality of the investor and whether it qualifies as a state owned enterprise
(that is, where the investor is controlled or influenced directly or indirectly by
a foreign state).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Nature of the Canadian business (for example, whether engaged in sensitive areas
(see below)).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Enterprise value of the Canadian business:
\par {\pntext }
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480 {\fi-360 \li {\*\pn \pnlvlblt \ilvl0
\ls38 \pnindent480 \pnf1 {\f2 \pntxtb \u8226\'3f}}{\listtext \b0 \cf1 \f2 \ri0
\i0 \qj \fs20 \li960 \u8226\'3f\tab }\ls38 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
the enterprise value of a Canadian business that is acquired through a share
acquisitions is the market capitalisation of the entity (for publicly traded
companies) or total acquisition value of the entity (for private companies), plus
its total liabilities (excluding its ordinary course liabilities), minus the
entity\rquote s cash and cash equivalents for publicly traded companies;
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
the enterprise value of a Canadian business that is acquired through an asset
acquisition is calculated as its total acquisition value, plus the assumed
liabilities, minus its cash and cash equivalents; and
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
for investors originating from certain countries with which Canada has certain
trade agreements, such as the United States and the EU, the current enterprise
threshold is CAD1.568 billion. For most other countries, the current enterprise
threshold is CAD1.045 billion.
\par {\pntext }
}
}
}
}{\pntext }
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li580
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A notification is essentially an administrative formality constituting notice of
the investment (with certain required information in respect of the investment) to
be filed with the Canadian Government. This must be done within 30 days after
closing or before the closing, at the investor\rquote s election. Information
concerning sources of funds and other factors relevant to a decision whether to
launch a review of a proposed investment on national security grounds are also
required to be provided within the notification. A review application is more
onerous, and the transaction is generally prevented from closing until the
requisite approval(s) under the ICA are received.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
One common misconception is that the use of a Canadian-incorporated acquisition
vehicle removes the transaction from the scope of the ICA. That is not the case: it
is the nationality of the persons ultimately controlling the acquisition vehicle
that is determinative for ICA purposes.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Investments in Canada are also screened under the ICA for national security issues,
as applicable and regardless of their size, although there is no mandatory pre-
notification national security regime.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In recent years, national security reviews under the ICA have become more prominent
and have resulted in several transactions being blocked. As a result, foreign
investors have become more inclined in recent years to engage with the government
on a pre-closing basis, even where not legally required to do so. This is done in
order to allow any analysis and issues relating to national security to occur on a
pre-closing basis. This has been particularly true where the target business is
engaged in sensitive areas, such as the technology, software, telecommunications,
defence or infrastructure industries (among others).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
While not specifically focused on foreign investment, it should be noted that the
Competition Act (Canada) can also have a significant impact on an acquisition,
whether foreign or domestic. For example, certain large transactions will trigger
advance notice requirements. Such transactions cannot then be completed until the
end of a review period. Pre-merger notification filings are required in connection
with:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A proposed acquisition of assets or shares or an amalgamation.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The formation of a non-corporate business combination.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The acquisition of an interest in such a combination where certain thresholds
relating to the \ldblquote size of the transaction,\rdblquote the \ldblquote size
of the parties\rdblquote and the \ldblquote percent of equity\rdblquote are
exceeded.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
While the vast majority of transactions are approved under the ICA, there have been
several high-profile failed transactions, including, for example:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The proposed acquisition of Aecon Group Inc., a major engineering and construction
firm, by CCCC International, a Chinese state-owned enterprise.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
BHP Billiton\rquote s proposed acquisition of Potash Corporation of Saskatchewan
(the world\rquote s largest potash producer).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
6.
}
}
Is your jurisdiction a member of any international treaty organisations and/or
economic, customs or monetary unions or free-trade areas?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada is internationally oriented and a member of several international treaty
organisations, including the following:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The UN.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The UN Conference on Trade and Development (UNCTAD).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The World Trade Organization (WTO).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The Organization for Economic Co-operation and Development (OECD).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The International Chamber of Commerce (ICC).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
International Monetary Fund (IMF).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
NATO.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
7.
}
}
What other international agreements apply to foreign investment?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
FTA and NAFTA
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Canada-U.S. Free Trade Agreement (FTA) came into effect in 1989. NAFTA was
ratified and has largely governed the trading relationships between Canada, the US
and Mexico since 1994.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The core of NAFTA consists of objectives and provisions that resemble those in the
FTA. Rather than repealing the FTA, Canada and the US agreed by exchange of
diplomatic notes that NAFTA will, as long as it remains in force between them, take
priority over the FTA. In addition, NAFTA encompasses several separate bilateral
commitments between Canada and Mexico, and the US and Mexico.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
NAFTA improved on the FTA in many respects, including as follows:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The inclusion of intellectual property provisions (made possible by Canada\rquote s
decision to dismantle its compulsory licensing scheme respecting pharmaceutical
patents).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The inclusion of provisions addressing certain environmental concerns.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Incorporation of provisions respecting anti-competitive and private business
practices as a means of attaining the other objectives of the agreement.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The USMCA will replace NAFTA once it comes into force. (For a further description
of the USMCA, please see
}
{\b0 \cf1 \f2 \i1 \fs20
Question 30
}}}
}
.)
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
CETA
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
CETA is a comprehensive free trade agreement between Canada and the EU that
eliminates or reduces certain trade barriers and enhances market access. CETA also
helps streamline and improve trade and investment flow between Canada and the EU,
and opens both regions to new markets and greater competitive advantage.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The EU is Canada\rquote s second largest trading partner after the US and the
world\rquote s second largest importing market for goods. CETA is expected to
substantially increase the flow of goods, services, and investments between Canada
and the EU.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
CETA offers opportunities and advantages for Canadian business in many ways,
including the following:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Harmonising trade procedures and policies.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Improving access to public contracts.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Facilitating greater labour mobility.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Promoting and protecting foreign investment.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Increasing M&A activity.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
TPP/CPTPP
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
On 5 October 2015, Canada announced that it had successfully concluded negotiations
with respect to the Trans-Pacific Partnership (TPP), an ambitious free trade
agreement among 12 countries: Canada, the US, Mexico, Chile, Peru, Japan, Vietnam,
Brunei, Malaysia, Singapore, Australia and New Zealand. Purporting to be the
world\rquote s most comprehensive trade agreement, the TPP promised to strengthen
Canada\rquote s economic ties within the Asia-Pacific region as well as enhancing
its existing partnerships within the Americas, including with its NAFTA partners.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The significance of the TPP is underscored by the anticipated economic growth in
the Asia-Pacific region, which is expected to include two thirds of the
world\rquote s middle class by 2030 and one half of global GDP by 2050. The TPP was
essentially aimed at the reduction or elimination of tariffs and import quotas
among participating countries, which included such traditionally high-tariff
jurisdictions as Japan, Vietnam and Malaysia.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The TPP was not ratified, and has not come into effect, due to the withdrawal by
the US. The remaining eleven countries subsequently entered into the Comprehensive
and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which became
effective on December 30, 2018. It is a similar trade agreement incorporating a
significant number of the concepts previously negotiated as part of the TPP.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Other free trade agreements
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada has concluded trade agreements with other countries as follows:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The Canada-Chile Free Trade Agreement in 1996.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A free trade agreement between Canada and Israel in 1997.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A free trade agreement with Costa Rica, which came into force in 2002.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Free trade agreements with the European Free Trade Association (EFTA) countries of
Iceland, Liechtenstein, Norway and Switzerland and:
\par {\pntext }
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
Peru, which came into force in 2009;
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
Korea, which came into force in 2014; and
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
Colombia, which came into force in 2011.
\par {\pntext }
}
}
}
}{\pntext }
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li580
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Bilateral free trade agreements with Jordan and Panama, which were effective in
2012 and 2013 respectively.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A free trade agreement with Honduras, which was concluded in 2011.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
It should be noted that Canada is an active participant in the Trade in Services
Agreement, which is being negotiated by 23 members of the WTO with a goal to
further liberalise trade in services by developing new and enhanced disciplines and
to improve market access.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada has also been involved in negotiations for a free trade agreement with
Argentina, Brazil, Paraguay and Uruguay, among others. In addition, Canada is
currently negotiating potential trade agreements with India, Guatemala, El
Salvador, Nicaragua, Singapore, Japan, the Dominican Republic, Pakistan, Morocco
and the Caribbean Community. Canada has also had exploratory discussions with
China, the Association of Southeast Asian Nations and has entered into trade,
investment and economic agreements with other nations.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada is also party to numerous double-taxation agreements that provide foreign
tax relief for businesses and individuals. For further information on double-
taxation agreements, please see
}
{\b0 \cf1 \f2 \i1 \fs20
Question 25
}}}
}
.
\par
}
}
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
}
\u160\'3f
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs28 \li0
Investor individuals
\par
}
}
\u160\'3f
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
8.
}
}
Are there any visas, permits or other requirements for foreign individuals entering
your jurisdiction for business purposes?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
With some exceptions for \ldblquote visitor visa exempt\rdblquote countries, such
as the US, every prospective visitor or immigrant must apply for, and obtain, a
visa before entering Canada.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Further, effective March 2016, the government of Canada introduced an entry
requirement, known as an electronic travel authorization (eTA), for visa-exempt
foreign nationals travelling to Canada by air. The eTA is valid for up to five
years or until the individual\rquote s passport expires, depending upon which first
occurs.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Temporary entry
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Temporary entry without a work permit.
}
}
Those who are neither Canadian citizens nor permanent residents may be granted
temporary admission to Canada, without a work permit, provided that the:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Individual is a permanent employee of a corporation outside Canada carrying on
business in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Individual\rquote s activities within Canada are limited to:
\par {\pntext }
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
meeting and consulting with other employees of a Canadian parent company,
subsidiary or branch office;
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
selling goods to parties other than the general public; or
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
purchasing Canadian goods and services.
\par {\pntext }
}
}
}
}{\pntext }
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li580
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Temporary entry without a work permit is also permitted for the purpose of giving
or receiving training at a Canadian subsidiary, affiliate or branch office and for
after sales service (a very limited category of business visitor). In most other
cases, a work permit is required by persons who seek temporary admission to Canada
for work purposes.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Temporary entry with a work permit.
}
}
Temporary foreign workers who are not citizens of \ldblquote visitor visa
exempt\rdblquote countries (or who have lived in a country for six consecutive
months in the last 12 that require a medical before entering Canada) must generally
apply for a work permit at a Canadian Consulate or High Commission outside of
Canada prior to arrival. The US, Japan, the UK, France, Germany, most other EU
countries, and all Commonwealth countries, are some of the \ldblquote visitor
visa\rdblquote exempt countries.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
An applicant who qualifies for a work permit under a Labour Market Impact
Assessment (LMIA) exemption category (that is, NAFTA, GATS, or another exempt
category, see below) may apply for a work permit on arrival at a port of entry to
Canada.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A work permit is usually issued for an initial period of one to three years and can
be extended for certain time periods in certain circumstances.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Each province of Canada has a Temporary Foreign Worker Unit. Individuals from
\ldblquote visitor visa exempt\rdblquote countries, (who are not required to
complete a medical examination and who qualify for an exemption pursuant to the
LMIA process (see below) can request a pre-opinion from the Temporary Foreign
Worker Unit regarding whether their application qualifies for entry into Canada.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
For workers who do not qualify for an LMIA work permit exemption, the Canadian
employer must obtain an LMIA through the Foreign Worker Unit of the Service Canada
Centre, which must confirm that employment opportunities for Canadians will not be
adversely affected by employing the foreign worker. The Service Canada Centre has
imposed mandatory advertising requirements with respect to the hiring of foreign
workers who require a LMIA. If the mandatory advertising requirements are not
followed, the application will be rejected.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
International agreements
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
NAFTA and the Immigration and Refugee Protection Action (IRPA) assist in expediting
temporary access to Canada for foreign workers through a streamlined application
process under which the foreign worker may apply for a work permit at a port of
entry. The General Agreement on Trade in Services (GATS) also provides expedited
treatment for certain categories of citizens of nations who are members of the WTO,
but for shorter access periods. Other international agreements may apply, such as
the Canada-Chile Free Trade Agreement, CETA, CPTPP or another multilateral
agreement (
}
{\b0 \cf1 \f2 \i1 \fs20
see
}
Question 7
}}}
}
).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The following categories of persons seeking to enter Canada for business purposes
may be admitted to Canada at a port of entry pursuant to NAFTA:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Persons who are categorised as \ldblquote business visitors\rdblquote (or as
persons seeking to engage temporarily in the trade of goods or services or in
investment activities within Canada).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Persons who meet education and experience qualifications set out in NAFTA, who will
carry out professional work while temporarily in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Executives, senior managers or \ldblquote specialised knowledge workers\rdblquote
who:
\par {\pntext }
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
have been employed by a company, or its affiliate or subsidiary, for at least one
year within the three-year period immediately prior to the application; and
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
are coming to Canada to work temporarily for the same company, affiliate or
subsidiary.
\par {\pntext }
}
}
}
}{\pntext }
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li580
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
9.
}
}
Are there any visa waivers or fast-track procedures available for foreign
individuals entering your jurisdiction as investors?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Provincial Nominee Programs
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Certain provinces in Canada operate a Provincial Nominee Program (PNP). A PNP
allows a province or territory to nominate a specified number of economic
immigrants each year for permanent residence in that province or territory. In
addition, a certain number of a province\rquote s or territory\rquote s nominees
may be selected for the federal Express Entry system.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Start-Up Visa Program
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada\rquote s Start-Up Visa Program provides permanent resident visas for
immigrant entrepreneurs that demonstrate the necessary skills to build businesses
in Canada that are innovative, will create jobs for Canadians, and can compete on a
global scale. Successful applicants are required to secure a minimum investment for
their Canadian start-up from a designated organisation, which must be at least CAD
200,000, if the designated organisation is a Canadian venture capital fund and at
least CAD75,000, if the designated organisation is an angel investor group.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Alternatively, an applicant can receive support for their business in Canada from a
business incubator. To receive such support, an applicant must be accepted into a
designated Canadian business incubator program. Getting into these programs is a
competitive process with limited spaces available. However, unlike receiving
support from a venture capital fund or an angel investor group, the applicant does
not need to secure a financial investment from the business incubator.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
10.
}
}
What are the circumstances under which an individual becomes liable to pay tax in
your jurisdiction? Can individuals be liable for tax on foreign-source income?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Overview
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Residents of Canada are subject to tax on their worldwide income (including capital
gains) under:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The Income Tax Act (Canada) (ITA).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The relevant provincial tax legislation.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Non-residents of Canada are generally subject to tax only on their:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Canadian source income, including income from a business or employment carried on
or performed in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Taxable capital gains from the disposition of \ldblquote taxable Canadian
property\rdblquote (as defined in the ITA).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Although each province has also enacted provincial income tax legislation, only
Alberta and Qu\u233\'3fbec administer their own corporate income taxes, and only
Qu\u233\'3fbec administers its own individual income taxes. Other provinces rely on
the federal government to collect taxes on their behalf.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Taxation of Canadian residents (basic principles)
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
An individual who is resident in Canada is subject to tax on his or her worldwide
income (including capital gains). Whether an individual is resident in Canada is a
question of fact to be determined on a case-by-case basis. However, as a general
rule:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
An individual is considered to be resident in the country in which he or she
\ldblquote ordinarily resides\rdblquote , which is generally either the place where
that individual maintains:
\par {\pntext }
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
a home to which he or she regularly returns; or
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
significant social, economic or family ties.
\par {\pntext }
}
}
}
}{\pntext }
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li580
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
An individual is deemed to be resident in Canada throughout the year if he or
she \ldblquote sojourns\rdblquote (is physically present) in Canada for an
aggregate of 183 days or more during the calendar year.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
An applicable tax treaty might resolve questions as to which of two countries an
individual resides in.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Federal individual tax rates are progressive, and tax brackets are indexed annually
for inflation. Generally, the provinces/territories utilize a \ldblquote tax-on-
income\rdblquote system, in which they levy provincial/territorial income tax as a
percentage of the federal calculation of taxable income.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The 2019 marginal federal income tax rates for individuals range from 15% to 33%,
with the highest marginal rate applicable to taxable income in excess of
CAD210,371. The top marginal federal and provincial/territorial combined rates vary
by province/territory from 44.50% in Nunavut to 54% in Nova Scotia.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Taxation of non-residents of Canada (basic principles)
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Non-residents of Canada are subject to Canadian tax on:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Employment income performed in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Income from a business carried on in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Taxable capital gains from the disposition of \ldblquote taxable Canadian
property\rdblquote (except to the extent exempted by an applicable tax treaty).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In general, taxable Canadian property includes:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Real property situated in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Property used in carrying on business in Canada.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Unlisted shares of corporations or interests in partnerships or trusts, if more
than 50% of the value of these was derived from one or a combination of real
properties situated in Canada, Canadian resource properties or timber resource
properties at any time during the 60 months that ends at the date of disposition.
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Listed shares of a corporation if at any time during the 60-month period that ends
at the date of disposition both:
\par {\pntext }
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
more than 50% of the value of such share was derived from one or a combination of
real properties situated in Canada, Canadian resource properties or timber resource
properties; and
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li960
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li960
25% or more of the issued shares of any class of shares of the corporation were
owned by: the taxpayer; persons with whom the taxpayer did not deal at arm\rquote s
length; and partnerships in which the taxpayer or a person with whom the taxpayer
is not dealing at arm\rquote s length holds a membership interest.
\par {\pntext }
}
}
}
}{\pntext }
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li580
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A non-resident of Canada will generally pay provincial income taxes on:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Taxable income earned in a province where the non-resident carries on business
through a permanent establishment situated in that province (or is otherwise deemed
to have a permanent establishment in a province).
\par {\pntext }
}
}
}
{\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Employment income reasonably attributable to duties performed in that province.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Withholding tax
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada typically imposes withholding tax on payments made to non-resident investors
which constitute:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Canadian-source dividends.
\par {\pntext }
}
}
}
\u8226\'3f}}{\listtext \b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
\u8226\'3f\tab }\ls100 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Non-arm\rquote s length interest.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls101 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Rent.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls102 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Royalties.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls103 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Certain other amounts.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Interest on arm\rquote s length debt is generally not subject to Canadian
withholding tax provided it is not \ldblquote participating debt interest\rdblquote
(which, in brief, is interest that is determined with reference to profits,
revenues, dividend rates or other similar criteria).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Under the ITA, the applicable rate of withholding tax is typically 25%. However, as
discussed elsewhere in this article, this rate is often significantly reduced by
tax treaties.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Relief from Canadian tax
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada has a very broad network of double taxation treaties which generally work to
relieve residents and non-residents from tax that would otherwise be payable or
work as a barrier to international transactions.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
To achieve the relief of double taxation, treaties generally work to assign and
limit tax jurisdiction to just one country when it would otherwise belong to both
countries involved. For example, Canada\rquote s tax treaties generally limit the
circumstances in which Canada can tax a non-resident on capital gains from the
disposition of property. Accordingly, in certain cases, gains from property which
is \ldblquote taxable Canadian property\rdblquote (as described above) may be
exempt from Canadian tax pursuant to an applicable tax treaty, notwithstanding that
gains from such property would otherwise be subject to tax under Canada\rquote s
domestic laws.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Treaties also work to reduce withholding tax rates on payments made from Canada to
a foreign resident. For example, under the Convention between Canada and the United
States, where a shareholder owns at least 10% of the voting stock of a Canadian
corporation, withholding tax is reduced to 5% of the gross amount of dividends
paid, and its otherwise reduced to 15%. Payments of arm\rquote s length interest
are exempt from withholding tax under the Convention between Canada and the United
States (excluding payments of participating debt interest).
\par
}
}
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
}
\u160\'3f
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs28 \li0
Investment restrictions
\par
}
}
\u160\'3f
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
11.
}
}
Are there any restrictions on foreign ownership and investment in specific industry
sectors? Do any formalities, permit or notification requirements apply?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Foreign ownership and investment can be subject to scrutiny by federal foreign
investment review authorities. Under the ICA, the federal government has a mandate
to screen proposed foreign investments to ensure that they are likely to produce
a \ldblquote net benefit to Canada.\rdblquote
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
US investors, and other non-Canadian investors from countries with specific trade
agreements with Canada, must generally file an application with Innovation, Science
and Economic Development Canada where:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Direct control is being acquired of a Canadian business, which is not a cultural
business.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls105 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The enterprise value of the Canadian business exceeds CAD1.568 billion.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The enterprise value threshold is CAD1.045 billion for non-Canadian investors from
other WTO member states. It is significantly lower for investors who may be
considered to be state-owned enterprises or sovereign wealth funds.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In addition to the general ICA process discussed above, the following additional
formalities apply in particular circumstances:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A national security review may be required where the government believes that an
investment may be injurious to national security, regardless of transaction size or
value.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls107 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The ICA contains special, more restrictive thresholds and rules in relation to
\ldblquote cultural businesses\rdblquote , which are businesses engaged in the
publication, distribution or sale of books, newspapers, magazines, music, video or
film.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls108 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Various federal and provincial statutes place additional foreign ownership
restrictions in certain industries (
}
{\b0 \cf1 \f2 \i1 \fs20
see
}
Question 12
}}}
}
).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
12.
}
}
Does the government retain and exercise control over certain industry sectors? If
so how?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In addition to the general ICA process, various federal and provincial statutes
place additional foreign ownership restrictions in certain industries, some of
which are discussed below.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Broadcasting and telecommunications
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The federal government has exclusive jurisdiction over broadcasting (radio,
television and their distribution, including some internet activity) and
telecommunications. The Canadian Radio-television and Telecommunications Commission
(CRTC) is Canada\rquote s broadcasting and telecommunications regulator.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Governor in Council has the discretionary power to issue binding directions to
the CRTC (
}
{\b0 \cf1 \f2 \i1 \fs20
Broadcasting Act
}
}
). A Cabinet direction has been issued prohibiting the issuance and the granting of
a broadcasting licence to:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Governments other than the government of Canada.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls110 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Persons who are not Canadian citizens or \ldblquote eligible Canadian
corporations\rdblquote .
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
For corporate licensees, the Cabinet direction provides that to be eligible for a
licence:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The corporation must be incorporated or continued under Canadian law.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls112 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The CEO or equivalent and not less than 80 % of its board of directors must be
Canadian.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls113 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
At least 80 % of the voting shares, and 80 % of the votes must be owned and
controlled by Canadian.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls114 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The corporation must not otherwise be controlled by non-Canadians.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Only telecommunications common carriers (that is, the entities that own or operate
facilities) with greater than a 10% share of national telecommunications revenues
must be Canadian owned and controlled (
}
{\b0 \cf1 \f2 \i1 \fs20
Telecommunications Act
}
}
). This requirement is satisfied if all the below requirements are met:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A carrier is incorporated in Canada (either federally or provincially).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls116 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
80% or more of the members of the carrier\rquote s board of directors are Canadian
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls117 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Not less than 80% of the carrier\rquote s voting shares are beneficially owned by
Canadians.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls118 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The carrier corporation is not otherwise controlled by non-Canadians.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Air transportation services
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
At least 75% of the voting interests of an air service is required to be owned and
controlled by Canadians, unless the below requirements are met (
}
{\b0 \cf1 \f2 \i1 \fs20
Transportation Modernization Act
}
}
):
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
No more than 25% of the voting interests are owned directly or indirectly, by a
single non-Canadian.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls120 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
No more than 25% of the voting interests are owned by one or more non-Canadians
authorized to provide an air service in any other jurisdiction, in which event at
least 51% of the voting interests are required to be owned and controlled by
Canadians.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Uranium production
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Non-resident ownership of uranium mining properties is restricted to 49% at the
stage of first commercial production (
}
{\b0 \cf1 \f2 \i1 \fs20
1987 \ldblquote Non-Resident Ownership Policy in the Uranium Mining
Sector\rdblquote (NROP)
}
}
).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
However, higher levels of non-resident ownership may be permitted if it can be
demonstrated that the project is in fact Canadian-controlled. Exemptions to the
NROP may be granted by the Minister of National Resources, subject to Cabinet
approval, in cases where it can be demonstrated clearly that no Canadian partners
in the project can be found. There are no restrictions in uranium exploration by
foreign entities.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Banking
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Bank Act requires ministerial approval for any foreign bank to acquire or hold
control of, or a substantial investment in, a Canadian bank. The minister is
prohibited from approving a transaction that would allow a Canadian bank to become
a subsidiary of a bank that is not subject to the laws of a WTO jurisdiction. The
exception to this is where the minister is satisfied that the Canadian bank will be
entitled to receive treatment that is as favourable as the treatment under the Bank
Act in such jurisdiction.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Bank Act permits a foreign bank to establish a foreign subsidiary or one or
more branches of the foreign bank in Canada. Foreign banks carrying on business
through a foreign subsidiary are subject to the same capital requirements and
regulations as Canadian banks. Foreign banks operating through a foreign bank
branch are not subject to the Canadian capital requirements.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A foreign bank may maintain one or more representative offices in Canada but is
prohibited from carrying on any active banking business in Canada except through a
duly approved foreign subsidiary or bank branch.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
13.
}
}
Are there restrictions on foreign ownership or occupation of real estate? Do any
formalities, permit or notification requirements apply?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
As a general principle, natural persons other than those under a legal disability
are capable of acquiring, holding and disposing of real estate in Canada. A
Canadian non-resident can generally acquire, hold and dispose of real estate in the
same manner as a Canadian resident or citizen.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
That notwithstanding, the federal Citizenship Act permits each province to enact
laws restricting ownership of real property within the province by non-residents.
These restrictions on ownership vary from province to province:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Prince Edward Island has enacted legislation which significantly restricts the
amount of land that may be held by persons (whether corporations or individuals)
not resident in the province.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls122 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Alberta and Qu\u233\'3fbec have legislation prohibiting the acquisition of
interests in certain types of real property by non-residents without the prior
consent of the province or an applicable exemption (both restrict ownership of
agricultural land and Qu\u233\'3fbec also restricts ownership of classified
cultural objects).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Further, some provinces have provincial licensing or registration requirements that
must be complied with if a corporation is to hold land in that province. There is
also federal legislation on foreign ownership that provides for notification to, or
review by, the federal government in certain circumstances involving acquisitions
by non-resident purchasers.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
14.
}
}
Are there any minimum capital requirements for foreign investment?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In general, there are no minimum capital requirements for foreign investment, other
than certain incorporation or registration fees, where applicable.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
15.
}
}
Are there any exchange control or currency regulations? Are there any restrictions
on the remittance of profits abroad?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Other than the usual laws governing money laundering and the transfer of funds for
crime and terrorism, Canada does not generally restrict the movement of funds into
or out of the country. Canada does not impose restrictions on the buying or selling
of any foreign currency. Corporations and individuals can operate in foreign funds
and arrange payments in any currency they choose.
\par
}
}
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
}
\u160\'3f
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs28 \li0
Imports
\par
}
}
\u160\'3f
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
16.
}
}
Are there any restrictions on the importation of commercial goods?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Certain goods may be prohibited or controlled, or require special permits,
inspections, or conditions to be allowed into Canada. The Canada Border Services
Agency (CBSA) provides a step-by-step guide to help importers determine whether
their goods may be subject to special rules or conditions (
}
{\b0 \cf1 \f2 \i1 \fs20
{\field {\*\fldinst HYPERLINK "http://www.cbsa-asfc.gc.ca/import/guide-eng.html" }
{\fldrslt
www.cbsa-asfc.gc.ca/import/guide-eng.html
}}}
}
).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Further, CBSA provides a list of some of the most commonly imported commodities
that may require permits and/or certificates (
}
{\b0 \cf1 \f2 \i1 \fs20
{\field {\*\fldinst HYPERLINK "http://www.cbsa-asfc.gc.ca/import/reflist-listeref-
eng.html" }{\fldrslt
www.cbsa-asfc.gc.ca/import/reflist-listeref-eng.htmlMemoranda Series D19, Acts and
Regulations of Other Government Departments
}}}
}
).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
More comprehensive information can be found in (
}
{\b0 \cf1 \f2 \i1 \fs20
{\field {\*\fldinst HYPERLINK "http://www.cbsa-asfc.gc.ca/publications/dm-md/d19-
eng.html" }{\fldrslt
www.cbsa-asfc.gc.ca/publications/dm-md/d19-eng.html
}}}
}
).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Export and Import Controls Board monitors the import and export of controlled
goods. These include goods such as:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Sugar and softwood lumber, which are the subject of quota agreements.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls124 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Weapons, munitions, nuclear materials, and goods of a similar nature.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
CBSA administers Canada\rquote s laws and regulations governing products on the
import control list.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
17.
}
}
What import duties apply to commercial goods?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Duties on imports
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Customs Tariff imposes duties on a wide range of goods. Rates of duty depend on
the country of origin and the nature of the product being imported. The country of
origin is determined in accordance with the Customs Tariff (or with various free
trade agreements between Canada and other countries).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The classification of a product is determined under the Harmonized Commodity
Description and Coding System, which is also used in the US and most countries of
Europe and Asia. The Canadian system for determining the value of goods for duty
purposes is based on the international Customs Valuation Code pursuant to the
General Agreement on Tariffs and Trade (GATT).
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Taxes on imports
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A federal tax with a current rate of 5% called the Goods and Services Tax (GST) or
the federal portion of the Harmonized Sales Tax (HST), will be imposed on most
goods imported into Canada. The GST or federal portion of the HST is imposed on the
value for duty of imported goods, plus any applicable duties.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Special excise taxes and duties may also be levied with respect to certain goods.
Excise taxes are levied on a limited number of goods imported into Canada,
including:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Certain automobiles.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls126 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Air conditioners for automobiles.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls127 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Gasoline products.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Excise duties are imposed on:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Spirits, wine, beer and tobacco.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls129 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Cigars and cigarettes produced or manufactured in Canada.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
An additional customs duty is levied on spirits, wine and beer when they are
imported into Canada, in an amount equal to the excise duties that would have been
imposed had they been manufactured in Canada. In the case of spirits, wine and
tobacco products, the duty payment may be deferred to the time of sale to a
retailer.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Duty relief
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Duty relief in the form of drawbacks or exemptions may be available where goods
are:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Imported and subsequently exported.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls131 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Used in the manufacture of products that are ultimately exported.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls132 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Used in the production of goods if an equal amount of a similar domestic or
imported material is used to make the product for export.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls133 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Used in Canada for prescribed purposes or in specified industries.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
NAFTA limits the availability of drawbacks for exports to the US and Mexico. Duty
relief may also be available where certain imported machinery is not available in
Canada and under free trade agreements between Canada and other countries.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
18.
}
}
Are the safety regulations and standards applicable to commercial goods in your
jurisdiction compatible with other standards that are recognised internationally?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
The National Standards System
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In Canada, there are thousands of domestic standards in place. Once a standard is
developed by a standards development organization (SDO), the SDO may submit it to
the Standards Council of Canada (SCC) as a National Standard of Canada. There are
more than 7,000 national standards used as the basis of commercial transactions and
regulations in Canada.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada\rquote s National Standards System (NSS) is the framework for developing,
promoting and implementing national standards in Canada. The SCC, a federal Crown
corporation, oversees the NSS, accrediting more than 250 organisations involved in
standards development, product or service certification, testing and management
systems registration in Canada.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
International standards
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
International standardisation activities are becoming more important to Canadians.
International standards form the basis for more than half of the National Standards
of Canada. Federal government policy encourages regulators to determine whether
international standards can form the basis of proposed regulations. Trade
agreements (for example the WTO\rquote s Agreement on Technical Barriers to Trade)
also require governments to use international standards for regulation whenever
possible.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The SCC is a member of the International Organization for Standardization, one of
the most important international standards bodies in the world with over 130
members. The SCC coordinates Canada\rquote s participation in the international
standards system. This is becoming an increasingly important part of the SCC\rquote
s activities.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
19.
}
}
Are there any similar or equivalent restrictions on providing services into another
jurisdiction?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Extra-provincial registration is a process of incorporation in Canada that both
}
{\b0 \cf1 \f2 \i1 \fs20
{\field {\*\fldinst HYPERLINK "https://www.thebalancesmb.com/types-of-corporations-
in-canada-2948060" }{\fldrslt
domestic corporations
}}}
}
and
}
{\b0 \cf1 \f2 \i1 \fs20
{\field {\*\fldinst HYPERLINK "https://www.thebalancesmb.com/what-is-a-controlled-
foreign-corporation-4157448" }{\fldrslt
foreign corporations
}}}
}
must go through when they seek to do business in Canada or in various provinces or
territories throughout Canada.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Extra-provincial registration applies to foreign corporations who want to do
business in Canada. If the foreign corporation wanted to engage in business in more
than one province, it would need to register separately with each province. This
would require contacting the provincial registry of each province it wanted to
engage in business in to:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Retrieve and complete required forms.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls135 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Pay the accompanying fees.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Foreign corporations also need to be aware that for extra-provincial registration,
they will need an Agent for Service, that is, either:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
An individual, 18 years of age or older who is resident in the province they want
to do business in.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls137 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A corporation having its registered office in that province.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
}
\u160\'3f
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs28 \li0
Structuring and tax
\par
}
}
\u160\'3f
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
20.
}
}
How is foreign investment into your jurisdiction typically structured? What forms
of legal vehicle are attractive to foreign investors?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The main forms of business structures used in Canada are the sole proprietorship,
partnership, and corporation. Parties may also engage in business through joint
ventures.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Corporations
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A Corporation in Canada holds all the legal rights of a natural person, and is
legally distinct from its shareholders. Since a corporation is a distinct legal
entity, it is subject to income tax. As a general rule, shareholders of a
corporation enjoy limited liability.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Business Corporations Acts.
}
}
Both the federal and provincial governments have enacted legislation providing for
the incorporation and regulation of business corporations (known as \ldblquote
companies\rdblquote under some statutes). A business corporation incorporated
under provincial law may carry on business as of right in the province of its
incorporation and also has the capacity to carry on business extra-provincially
(beyond the limits of that province).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A federal business corporation is subject to provincial laws of general
application, although it has the basic right to carry on business in any province.
Most provinces require corporations incorporated in other jurisdictions to register
as an extra-provincial corporation before doing business in that jurisdiction.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Corporations must file initial and annual returns and notices reporting certain
basic corporate changes, the details of which vary from province to province.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
There are several tax advantages to incorporation, including:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Tax-deferral opportunities for shareholders.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls139 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Access to lower corporate tax rates.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls140 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Annual tax incentives and a capital gains exemption (for certain corporations and
shareholders).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Unlimited companies.
}
}
An interesting hybrid of a corporation and a partnership is the \ldblquote
unlimited company\rdblquote (ULC), which exists to the Provinces of Nova Scotia,
British Columbia and Alberta. The \ldblquote members\rdblquote or shareholders of
an unlimited company have unlimited liability in certain circumstances.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
ULCs gained popularity in the mid-1990s, as a ULC that is a subsidiary of a US
parent was able to produce certain tax advantages, as a tax flow-through vehicle,
for its parent. However, the Fifth Protocol to the U.S.-Canada Income Tax Treaty
has now limited many of the tax advantages previously enjoyed through ULCs,
although a ULC may still be beneficial for US tax purposes.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
ULCs are hybrid entities in that they are treated as corporations for Canadian
domestic income tax purposes, but can be treated as flow-through or transparent
entities for U.S. tax purposes (absent an election to treat the ULC as a
corporation for U.S. tax purposes). The option to view the ULC as transparent for
U.S. tax purposes may provide certain tax benefits for U.S. shareholders, such as
the ability to flow losses through the ULC to the U.S. shareholder in order to
reduce the shareholder\rquote s U.S. taxable income. ULCs are often also used to
avoid certain negative US tax consequences that can arise for U.S. shareholders
from owning foreign corporations.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Partnerships.
}
}
A partnership is formed under the laws of a particular province, but, similar to
corporations, partnerships carrying on business in more than one province will be
required to comply with the laws of, and may be required to register in, each
province.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In the absence of an agreement to the contrary, the rights and obligations of
partners are set out in the governing provincial legislation.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canadian jurisdictions recognise two forms of partnership:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
General partnerships have most of the characteristics of sole proprietorships,
except that they include more than one person and they are subject to the relevant
provincial partnership legislation. Each partner of a general partnership is
jointly and severally liable for the obligations of the general partnership.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls142 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The only filing normally required with respect to a general partnership is a
registration of the business name (if the partners are not using their own names).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls143 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Limited partnerships are formed by filing a declaration of partnership under the
relevant provincial partnership statute. A limited partnership\rquote s
partner\rquote s liability is limited to its financial contributions to the
partnership, provided that such limited partner refrains from participating in the
limited partnership\rquote s business. What constitutes involvement in the business
varies slightly from province to province.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls144 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A limited partnership is distinct from a \ldblquote limited liability
partnership\rdblquote , a special form of partnership recognised in most Canadian
jurisdictions, which is designed principally for law firms and other professional
services firms.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls145 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Partnerships are not taxpayers under the ITA and as such, a partnership does not
pay income tax itself and does not file an annual income tax return. Instead, each
partner includes a share of the partnership\rquote s income or loss in computing
its taxable income. For Canadian partners, a partnership structure can be
particularly beneficial where a business is expected to incur significant expenses
(for example, in its early stages) allowing partners to utilise these deductions in
computing their taxable income. Because partnerships are not separate legal
entities for Canadian tax purposes, where foreign investors invest in Canadian
operating business through a partnership, each partner will generally be subject to
tax on their portion of the partnership\rquote s income, and will be required to
file a Canadian income tax return.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls146 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Where a foreign corporation is a partner in a partnership which carries on business
in Canada, the corporation will also be subject to branch tax in respect of the
partnership\rquote s business. Branch tax generally applies to profits that are not
reinvested in Canada and is intended to replicate the dividend withholding tax that
would apply to dividends paid from Canada in a corporate structure. Where a
partnership has invested in taxable Canadian property, any capital gain which
arises on the disposition of such property will similarly be allocated to each
partner, who will then be liable to tax in Canada at their applicable tax rate.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls147 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
In most situations, partnerships are not used by non-residents to invest directly
in Canadian operating businesses given that:
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls148 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
There is usually no tax benefit to such a structure.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls149 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
It tends to add complexity (including by requiring the non-resident to file a
Canadian income tax return).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls150 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
However, Canadian partnerships are often used as a holding vehicle by foreign
investors to hold the shares of a Canadian company or to hold non-Canadian
investments. Income on the underlying investments will be allocated to the partners
and any non-Canadian source income would generally not be subject to Canadian tax
provided the partnership is purely a passive holding vehicle. Canadian source
income (such as dividends paid on the shares of a Canadian corporation owned by the
partnership) would be subject to Canadian withholding tax at the rate determined by
looking through the partnership to the residency of the partners.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Joint ventures.
}
}
Canadian law does not recognise a joint venture arrangement as a distinct form of
business association, and therefore a joint venture must take the form of a
recognised business organisation such as a corporation or partnership, or be
carried out through a contractual relationship. There is no specific joint venture
legislation in Canada.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \i0 \fs20
Sole proprietorships.
}
}
Although the sole proprietorship is free from most government regulations that
apply to business corporations, certain registration requirements must be complied
with in the jurisdiction in which the business is to be carried on. For example, a
sole proprietor who uses as his or her business style a name or designation other
than his or her own is required to register the name under applicable provincial
legislation.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Non-resident corporation
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Assuming that the non-resident corporation is resident in a country with which
Canada has an international tax treaty, that does not have a permanent
establishment in Canada, a non-resident corporation may carry on business in Canada
in several ways:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Through a wholly owned Canadian subsidiary of the non-resident corporation
(Canadian Subsidiary).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls152 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Directly as an unincorporated branch (Canadian Branch) of foreign corporation.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
There are a number of important matters to be considered when deciding whether to
establish a Canadian Branch or Canadian Subsidiary. Generally, the ongoing Canadian
corporate income tax should not vary significantly between a branch and a
corporation because income will generally be computed in the same manner and
subject to the same Canadian tax rate whether the taxpayer is a Canadian
corporation or a foreign corporation (in the case of a branch). As set out above,
foreign corporations that invest in Canada through a branch are subject to a branch
tax, which is generally intended to replicate the dividend withholding tax that
would apply in a corporate structure. However, there may be nuances in certain
situations, such that this analysis should be considered on a case-by-case basis.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
From a tax administration perspective, a subsidiary is often preferred because it
allows all the income of the Canadian business to be isolated in a single entity,
and therefore does not typically require the foreign parent to file tax returns in
Canada. On an exit:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A non-resident would be subject to Canadian tax on any gain realised on the sale of
a Canadian branch.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls154 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The purchaser would be required to withhold a portion of the purchase price.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls155 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
By contrast, the sale of a subsidiary\rquote s shares by a non-resident is usually
not subject to Canadian tax (see
}
{\b0 \cf1 \f2 \i1 \fs20
Question 10
}}}
}
regarding \ldblquote taxable-Canadian property\rdblquote ). Accordingly, a
subsidiary is likely a better option where it is expected that the Canadian
business may be sold separately from the operations of the parent.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Unlike the US, Canada does not provide for consolidated returns that allow the
profits of one corporation in a related group to be offset by losses in another
(absent the use of certain loss utilisation transactions).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Therefore, if a foreign corporation\rquote s Canadian operation is divided between
two or more Canadian corporations, losses in one of those Canadian corporations
could not generally be used to shelter income earned by the other(s). Similarly, if
the new Canadian operation were expected to operate at a loss in its initial stage,
it might be preferable to establish a branch of the foreign corporation so as to
permit the latter to deduct the loss in computing its tax liability in its home
jurisdiction.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
21.
}
}
What are the circumstances under which a business becomes liable to pay tax in your
jurisdiction?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Whether a corporation is resident in Canada is a question of fact to be determined
on a case-by-case basis. A corporation is generally considered to be resident in
Canada for income tax purposes if:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Its central management and control is exercised in Canada.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls157 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
It was incorporated or continued (that is, transferred out of the original
jurisdiction) into Canada.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
An applicable tax treaty might resolve questions as to which of two countries a
corporation resides in.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Like individuals, corporations resident in Canada are taxed on their worldwide
income.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A non-resident corporation may have to:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Pay tax on passive income it receives from Canada.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls159 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Withhold tax under Part XIII of the ITA if it pays or credits certain kinds of
income to another non-resident.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Partnerships are not themselves subject to Canadian income tax, as partnerships are
treated as flow-through entities for Canadian income tax purposes.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
However, partnerships are treated as separate entities solely for purposes of
computing the income or loss of the partners. Once income is computed at the
partnership level, it is allocated among the partners of the partnership in
accordance with their respective interests in the partnership.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Partnership losses also flow through to the partners. However, special rules may
apply to limit the amount of losses that may be claimed by limited partners in
certain circumstances.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
22.
}
}
What are the main business tax rates?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Income tax
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In general, the federal income tax rate for general corporations for the 2019
taxation year is 15%. General provincial corporate income tax rates for 2019 range
from 11.5% to 16%.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Goods and Services Tax and Harmonized Sales Tax
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The comprehensive federal Goods and Services Tax (GST) generally applies to the
supply of goods and services made in, or imported into, Canada. The rate of the tax
is currently 5%. The GST applies at each stage of production. However, if the
purchaser is involved in a commercial activity and is a qualified GST registrant,
it will generally be entitled to claim a refund, called an \ldblquote input tax
credit\rdblquote , for GST paid.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The harmonized sales tax (HST) is applicable in Ontario, New Brunswick,
Newfoundland and Labrador, Nova Scotia and Prince Edward Island. This tax combines
the federal GST and the applicable provincial sales tax, which generally ranges
from 8% to 10%, into one tax. HST rates therefore range from 13% to 15%, depending
upon the applicable province. The input tax credit, mentioned above, can also be
claimed for HST paid by qualified HST registrants.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Provincial sales tax
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Saskatchewan, British Columbia and Manitoba each impose a provincial sales tax or
retail sales tax (PST) on:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Most sales of tangible personal property.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls161 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Certain specified enumerated services within the particular province.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Each separate PST has distinct but similar rules. The rates for these taxes are:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
6% in Saskatchewan.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls163 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
7% in British Columbia.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls164 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
8% in Manitoba.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
These taxes must generally be collected and remitted by the vendor of the property
or services. However, each province has a number of exemptions for certain goods
(for example, production machinery and inventory for resale).
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Provincial payroll tax
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Manitoba, Newfoundland, the Northwest Territories, Nunavut and Ontario levy a
payroll tax on employers. It is calculated as a percentage of total remuneration
paid in the province, above a certain threshold.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In Ontario, for example, the rate of Employer Health Tax is generally 1.95% of
remuneration in excess of CAD490,000.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Qu\u233\'3fbec levies similar taxes calculated on the amount of remuneration paid
in Qu\u233\'3fbec. These taxes take the form of employer contributions to a
provincial health services fund, to a workplace training fund (if a minimum amount
is not spent on training in the company), to a parental insurance plan and to fund
a labour relations commission.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Taxes on real property
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Transfers of real estate in most Canadian jurisdictions are subject to a land
transfer tax, which is imposed at both the provincial and municipal levels. In some
provinces, municipalities (such as the City of Toronto in Ontario and various
municipalities in Qu\u233\'3fbec) may levy a land transfer tax in addition to the
tax levied by the province.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The rate of such taxes varies across the country:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
In Toronto, a combined municipal and provincial tax rate of 5% of the value of the
consideration over a specific threshold for certain residential properties is
applied.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls166 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
There is no tax at all on real property in Alberta, Newfoundland & Labrador and
parts of Nova Scotia.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
23.
}
}
What is the tax treatment in your jurisdiction of profits from an investee company
remitted outside your jurisdiction by an investor?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Amounts paid or credited by a resident of Canada to a non-resident person with
respect to most forms of passive income (including dividends, interest, rents and
royalties) are generally subject to Canadian non-resident withholding tax on the
gross amount of such payments.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The rate of Canadian non-resident withholding tax under the ITA is 25%, subject to
reduction under an applicable tax treaty. For example, the Canada-U.S. Income Tax
Convention limits the Canadian withholding tax on dividends paid by a corporation
resident in Canada to a resident of the US to 15% (or 5% where the recipient is a
corporation that owns at least 10% of the voting shares of the payor).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Under the ITA, there is no Canadian non-resident withholding tax on interest paid
or deemed to be paid by a Canadian resident person to a non-resident person where
both the:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Payor deals at arm\rquote s length.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls168 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Interest is not considered to be \ldblquote participating debt interest\rdblquote .
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Under the Canada-US Income Tax Convention, Canadian withholding tax on arm\rquote s
length and non-arm\rquote s length payments of nonparticipating debt interest to US
persons is generally nil.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
24.
}
}
What transfer pricing and/or thin capitalisation restrictions may apply to
investments into your jurisdiction from elsewhere?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Transfer pricing
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Transactions between a corporation resident in Canada and a non-resident
corporation with which it does not deal at arm\rquote s length (essentially, any
non-resident entity within a related group) are subject to Canadian income tax as
if such transactions had taken place between arm\rquote s length persons.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In this regard, Canada generally follows the OECD transfer pricing guidelines. The
terms and conditions of transactions may be adjusted under the ITA so that prices
charged on the transfer of property or provision of services between non-arm\rquote
s length parties reflect the prices that would have been adopted had those parties
been dealing at arm\rquote s length.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The ITA provides for certain contemporaneous documentation reporting requirements
with respect to non-arm\rquote s length transactions. Furthermore, a penalty may be
applicable at a rate of 10% of any net adjustment made by the Canada Revenue Agency
to the transfer prices of a Canadian affiliate. This penalty may be avoided if the
taxpayer demonstrates that it has made reasonable efforts to meet the transfer
pricing rules in its determination of the transfer prices.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Thin capitalisation
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The \ldblquote thin-capitalisation\rdblquote rules in the ITA limit the amount of
interest-bearing debt which can be invested in a Canadian corporation by its major
non-Canadian shareholders:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
A Canadian corporation generally may not deduct interest paid by it to \ldblquote
specified non-resident shareholders\rdblquote to the extent that the relevant
debt-to-equity exceeds a ratio of 1.5:1.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls170 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The same concept applies to a Canadian Branch but the debt-to-ratio is effectively
replaced with a 3:5 debt-to-net asset ratio.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Any interest which is denied a deduction under the thin-capitalisation rules is
also deemed to be a dividend for withholding tax purposes (and hence potentially
subject to the higher rate of withholding).
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
A specified non-resident shareholder is defined as any non-resident who alone or in
combination with other persons with whom it does not deal at arm\rquote s length
owns 25% or more of the voting shares or of the fair market value of all issued
shares of the subsidiary.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Similar rules exist with respect to trusts and structures that include
partnerships.
\par
}
}
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
}
\u160\'3f
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs28 \li0
Incentives
\par
}
}
\u160\'3f
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
25.
}
}
What tax incentive or other schemes exist to encourage foreign investment?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Canadian tax system provides for preferential tax treatment in certain
situations based on the nature of the taxpayer and the nature of the income being
earned. In particular, the ITA contains a number of fiscal incentive regimes
designed to encourage investment in particular sectors of the Canadian economy,
including:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Small business.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls172 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Oil and gas exploration.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls173 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Certain scientific and experimental developments.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Small businesses
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canadian-Controlled Private Corporations (CCPCs) are eligible for an annual tax
credit known as the small business deduction which reduces the corporation\rquote s
tax otherwise payable in respect of certain types of business income. Generally
speaking, the reduced rate of tax is available on active business income up to the
corporation\rquote s business limit for the year. The federal business limit is
currently CAD500,000.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Corporations qualify as a CCPC if they are private, Canadian, and not controlled by
non-resident persons or public corporations. Accordingly, non-resident investors
may invest in CCPCs, but typically they must remain minority investors and cannot,
in aggregate, hold a controlling interest in a CCPC. CCPCs can claim the small
business deduction when they complete their income tax returns.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Oil and gas exploration
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The ITA allows certain expenses to be deducted from income, to the extent those
expenses are reasonable, and are incurred for the purpose of earning income from a
business. Certain expenses incurred in operations are provided with special
resource expense deductions, depending on the nature of the expense. These
intangible expenditures are generally added to certain cumulative pools, classified
as either:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Cumulative Canadian exploration expenses (CEE).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls175 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Cumulative Canadian development expenses (CDE).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls176 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Cumulative Canadian oil and gas property expenses (COGPE).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In certain circumstances, successor rules can limit the deductibility of those
pools to income from particular resource properties, such as following an
acquisition of control of a resource corporation.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Expenses associated with the exploration of oil and gas deposits are generally
included in CEE. The most common types of expenses which fall into CEE include:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Seismic expenses for a deposit not previously known to exist.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls178 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Expenses incurred for drilling or completing an exploration well that results in a
new discovery.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls179 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Expenses incurred on a well that has not produced within twenty-four months of
completion.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls180 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Wells that result in costs of more than CAD5 million to complete.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls181 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
CEE is typically the most favourable of the special resource expense deductions, as
a corporation, in certain instances, can claim a deduction of 100% of its
cumulative CEE in a taxation year. A corporation whose principal business is the
exploration of, or drilling for, oil and natural gas can only deduct CEE to the
extent of its income and cannot use its CEE deductions to create a loss. Similarly,
CEE is not fully deductible for corporations whose business is in trading or
dealing in mineral or oil and gas rights.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Expenses associated with the development of oil and gas properties are generally
included in CDE. Costs associated with most drilling activities to develop an oil
and gas well, a disposal well, injection wells, monitoring wells, preparing a site
for production, or recompletion of a well after production commences, and which are
not CEE, are added to CDE in the year incurred. A corporation can claim a deduction
of up to 30% of its cumulative CDE in a taxation year on a declining-balance basis.
Expenses incurred in a taxation year to acquire Canadian resource property,
including oil and gas wells, rights to explore for oil and gas, and rights to
royalties, are added to a corporation\rquote s COGPE balance. A corporation can
claim a deduction of up to 10% of its cumulative COGPE in a taxation year on a
declining-balance basis.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
To enable corporations in the resource sector, particularly junior exploration
companies, to attract equity investment to fund exploration and drilling programmes
in Canada, the ITA allows for \u8216\'3fflow-through shares\rquote (FTS) to be
issued in certain circumstances. The FTS mechanism allows a principal-business
corporation (which includes a corporation of which the principal business is the
production, refining, marketing, exploring or drilling for petroleum or natural
gas) to incur and renounce certain eligible expenses (generally CDE and CEE) to a
shareholder in an amount up to the consideration paid by the shareholder for the
FTS shares, all pursuant to a FTS agreement. This CDE or CEE is then deductible, at
the above-noted rates, against the shareholder\rquote s taxable income.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Where a foreign business is a principal-business corporation carrying on qualifying
activities outside of Canada, the business may issue FTS and incur qualifying
expenses in Canada.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Scientific research and experimental development
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The Canadian federal government and the government of each of the provinces provide
generous tax incentives for the performance of scientific research and experimental
development (SR&ED) in a particular province. Where a corporation incurs
expenditures that qualify as SR&ED for the purposes of the ITA, such expenditures
may generally be deducted in the current year in computing taxable income.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
In addition, a federal investment tax credit equal to 15% (or 35% in respect of
CCPCs, subject to certain limitations) of qualifying SR&ED expenditures may be
available. The determination of whether certain activities constitute SR&ED is very
technical and fact specific. Most provinces provide similar tax incentives with
respect to expenditures relating to SR&ED.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Please refer to the Government of Canada\rquote s website at
}
{\b0 \cf1 \f2 \i1 \fs20
{\field {\*\fldinst HYPERLINK "https://www.canada.ca/en/services/taxes.html" }
{\fldrslt
www.canada.ca/en/services/taxes.html
}}}
}
for additional information on the tax incentives described above.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Treaty relief from Canadian taxation of business profits
\par
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada\rquote s tax treaties generally follow the OECD Model Tax Convention on
Income and Capital. Under Canada\rquote s tax treaties, business profits are
generally only taxable in Canada to the extent that the non-resident has a
\ldblquote permanent establishment\rdblquote in Canada. A permanent establishment
generally means a fixed place of business in Canada through which the business of
the entity is wholly or partly carried on. Under the Canada-US Income Tax
Convention, for example, the term \ldblquote permanent establishment\rdblquote
includes a place of management, branch, office, factory, workshop, and a mine, oil
or gas well, a quarry, or any other place of extraction of natural resources.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Generally, tax treaties also provide that if a non-resident person carries on
business in Canada through an agent, the non-resident has a permanent establishment
in Canada if the agent habitually exercises authority in Canada to conclude
contracts in the name of the non-resident.
\par
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs24 \li0
Investment guarantees
\par
}
}
\u160\'3f
\par
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
26.
}
}
What legal guarantees exist against expropriation and/or provide for appropriate
compensation? What is your government\rquote s track record in this regard?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The expropriation of real estate falls under both federal and provincial regulatory
regimes. The federal government has the statutory authority to expropriate land or
immovable real rights for public works or other public purposes pursuant to the
Expropriation Act (Canada). Similarly, each province and territory has
expropriation legislation which grants expropriation powers to authorities such as
the provincial government, municipalities and utility companies.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Expropriation legislation across the country sets out specific procedural
requirements for expropriating authorities, such as prescribed notice periods.
Compensation is generally based on the fair market value of the lands being
expropriated and, in some instances, may include reasonable costs and damages for
injurious affection. Expropriation rights in Canada are exercised sparingly and
judiciously.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
27.
}
}
Are there any issues in relation to the enforcement of intellectual property
rights?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canada has a mutually exclusive system of protection for patents, copyrights,
trademarks, industrial designs and integrated circuit topographies. Registrations
for intellectual property rights are generally \u8216\'3ffirst to file\rquote
systems, meaning that it is usually the first registrant (and not the first
inventor) that gains protection.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Once registration is granted, the terms of protection for some of the regimes are
as follows:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Patents are granted for a non-renewable period of 20 years.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls183 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Copyright is granted for the duration of the life of the author plus an additional
50 years from the end of the calendar year of his or her death.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls184 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Trade marks are granted for 15 years and are renewable for further 15-year periods
upon payment of a fee.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls185 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Industrial designs are granted for five years and are renewable for a further
period of five years, up to a limit of ten years in total.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls186 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Integrated circuit typographies are granted for a period of ten years.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The remedies that may be available to intellectual property holders for
infringement of their rights may include, among other things:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Actual damages.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls188 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Statutory damages (in the case of copyright).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls189 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Punitive and exemplary damages.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls190 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
An accounting of defendant\rquote s profits earned by the infringement.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls191 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Recovery of legal and expert expenses.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls192 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Seizure, destruction or delivery up of any infringing material in the
defendant\rquote s possession.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls193 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Injunctive relief.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls194 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Criminal sanctions (available in limited circumstances).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
28.
}
}
Are there any issues in relation to the gaining and enforcement of judgments and/or
arbitral awards?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Canadian court will enforce a foreign judgment without re-opening the case on the
merits if certain conditions are met. A key condition is that the foreign court
must have had jurisdiction over the defendant. Canadian courts will be satisfied on
this point where:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The defendant appeared and defended on the merits.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls196 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The defendant resided in the foreign jurisdiction.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls197 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The defendant had previously agreed to submit to the jurisdiction (for example,
pursuant to either an exclusive or non-exclusive jurisdiction clause).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls198 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
There was a real and substantial connection between the defendant and the foreign
jurisdiction in relation to the matter which is the subject of the litigation.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
It is no longer strictly the case that: the judgment must have been for a
\ldblquote sum certain\rdblquote of money. Where enforcement of another type of
order would not overtax the resources of the Canadian court, it may now also be
recognized.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
However, a judgment will not be enforced if the defendant establishes either of the
following:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The foreign court proceedings were not conducted fairly (that is, in accordance
with principles of natural justice).
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls200 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Enforcement is against public policy or public order.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls201 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
The judgment is a foreign tax or penal judgment.
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Another possible reason why a judgment may not be enforced is in case of fraud. In
a recent case that confirmed there are limited grounds to challenge the
enforceability of a foreign judgment, the Supreme Court of Canada held that where a
judgment is obtained by fraud that was undetectable by the foreign court, it will
not be enforced in Canada. There are similar rules for the enforcement of foreign
arbitration awards.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
There may be additional rules imposed on foreign investors in certain
circumstances. For example, in Ontario, the Rules of Civil Procedure entitle
defendants to demand that litigants ordinarily resident outside of Ontario post
security for costs in any proceeding. While this security will be returned if the
foreign litigant is ultimately successful, this is a notable difference in the up-
front costs associated with commencing a proceeding in Ontario.
\par
}
}
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
}
\u160\'3f
\par
}
{\b1 \cf29 \f2 \ri0 \i0 \qj \fs28 \li0
Recent developments and proposals for reform
\par
}
}
\u160\'3f
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
29.
}
}
Have there been any significant recent or proposed legal developments affecting
investors?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
On 1 May 2018, Bill C-25, an Act to amend the Canada Business Corporations Act, the
Canada Cooperatives Act, the Canada Not-for-profit Corporations Act and the
Competition Act, was passed by both houses of the Canadian Parliament (known as
\ldblquote Royal Assent\rdblquote ). However, as noted below, not all of the
provisions took effect immediately.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Bill C-25 is primarily an effort to bring the Canadian Business Corporations Act
(CBCA) into alignment with recent developments in Canadian securities laws and
stock exchange rules along three major themes:
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Expanded diversity disclosure.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls203 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Majority voting in uncontested director elections.
\par {\pntext }
}
}
}
\u8226\'3f\tab }\ls204 {\pntext }
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li480
{\b0 \cf1 \f2 \ri0 \i0 \ql \fs20 \li480
Online provision of meeting materials to shareholders (notice-and-access).
\par {\pntext }
}
}
}
}
}
{\b0 \cf1 \f2 \ri100 \i0 \qj \fs20 \li100
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
When regulations are finalised, Bill C-25 will require certain CBCA \ldblquote
distributing corporations\rdblquote to provide shareholders with information about
diversity policies at the board and senior management levels. The proposed
regulations provide some details about what this means.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Importantly, while Canadian securities laws already require gender diversity
disclosure for non-venture issuers, the proposed regulations expand the concept of
diversity to include indicia of diversity and do not include exemptions for venture
issuers.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Bill C-25 will implement a majority voting standard in uncontested director
elections for all public CBCA companies. Subject to certain exceptions, if a
director does not receive a majority of votes cast in an uncontested election, the
director would not be elected.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Since March 2013, the Canadian Securities Administrators have allowed reporting
issuers that are subject to Canadian securities regulations to provide meeting
materials to shareholders by posting the materials on the Internet, by way of
notice-and-access. This process has not been easily accessible to CBCA companies
because of technical provisions of the CBCA. The proposed amendments would align
the regulations under the CBCA for distributing corporations with the provincial
securities laws.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Many of the provisions in Bill C-25 are still not in effect, including those
implementing majority voting and mandating diversity-related disclosure. Instead,
the draft regulations under Bill C-25 must first be finalised and come into force.
This process will normally take six to 24 months. As a consequence, corporations
governed by the CBCA will probably not be required to comply with the new
diversity-related disclosure and majority voting requirements until 2020 or 2021,
at the earliest.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Additional amendments to the CBCA were also introduced through Bill C-86, Budget
Implementation Act, 2018, No. 2, which received Royal Assent on 13 December 2018
and which will come into force on 13 June 2019. Bill C-86 will require federally
incorporated private corporations to maintain registers that identify individuals
who exercise \ldblquote significant control\rdblquote over the corporation,
whether directly or indirectly. This is aimed at capturing information about
beneficial owners of a corporation in addition to legal owners.
\par
}
}
}
}
}{
\intbl
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf30 \f2 \i0 \fs20
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \ri620 \i0 \qj \fs20 \li620
{\b0 \cf1 \f2 \i0 \fs20
30.
}
}
Are there any planned or on-going treaty negotiations or political developments
that could have an impact on your jurisdiction\rquote s bilateral relationships
with other nations and/or other economic, customs or monetary unions, free-trade
areas or markets?
\par
}
}
}
}}\par
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
On 30 September 2018, after more than a year of contentious negotiations, Canada,
the US and Mexico announced the completion of negotiations toward the United
States-Mexico-Canada Agreement (USMCA), a new trilateral trade agreement between
the three countries.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
On ratification, the USMCA would replace the North American Free Trade Agreement
(NAFTA), in effect since 1994, under which merchandise trade among the three
countries has tripled to nearly USD1.1 trillion (2017). According to the Canadian
government, the USMCA \ldblquote provides key outcomes for Canadian businesses,
workers and communities in areas such as labour, environment, automotive trade,
dispute resolution, culture, energy, and agriculture and agri-
food\u8230\'3f\rdblquote and will \ldblquote create good, well\u8209\'3fpaying,
middle class jobs, strengthen economic ties, and expand Canada\rquote s trade in
North America.\rdblquote
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
The 30 September 2018 \ldblquote agreement in principle\rdblquote must still be
ratified by the three countries. While the treaty approval processes in Canada and
Mexico make ratification highly likely in both cases, the US system gives the
Congress considerable leverage.
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
Unlike the Canada-European Union Comprehensive Economic and Trade Agreement, the
USMCA does not contain a provision allowing for portions of the agreement to take
effect prior to it being fully implemented. Therefore, until the USMCA has been
implemented into law, NAFTA, in its entirety, will continue to be in force. In
accordance with Article 34.5 of the USMCA, each party is required to notify the
other parties, in writing, once it has completed the required internal procedures
for the entry into force of the USMCA. The agreement will then come into force on
the first day of the third month following the final notification.
\par
}
}
}
}
}
}
{\b0 \cf1 \f2 \ri0 \i0 \qj \fs20 \li0
{\*\bkmkstart co_anchor_a212746_1}{\*\bkmkend co_anchor_a212746_1}{
\intbl
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
\par
}
{\b1 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
Contributor profiles
\par
}
}
\u160\'3f
\par
}
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf32 \f2 \ri0 \i0 \qj \fs24 \li0
Elizabeth Breen, Partner
\par
}
}
\u160\'3f
\par
}
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
Stikeman Ellliott LLP
\par
}
}
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf32 \f0 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf32 \f0 \i0 \fs20
T
}
}
+1 416 869 5267
\par
}
{\b0 \cf32 \f0 \ri0 \i0 \qj \fs20 \li0
}
{\b0 \cf32 \f0 \i0 \fs20
E
}
}
{\b0 \cf32 \f0 \i1 \fs20
{\field {\*\fldinst HYPERLINK "mailto:ebreen@stikeman.com" }{\fldrslt
ebreen@stikeman.com
}\b0 \cf30 \f0 \ul0 \strike0 \i1 \fs20 \sa0 \sb0 }}
\par
}
{\b0 \cf32 \f0 \ri0 \i0 \qj \fs20 \li0
}
{\b0 \cf32 \f0 \i0 \fs20
W
}
}
{\b0 \cf32 \f0 \i1 \fs20
{\field {\*\fldinst HYPERLINK "http://www.stikeman.com" }{\fldrslt
www.stikeman.com
\par
}
{\b0 \cf32 \f0 \ri0 \i0 \qj \fs20 \li0
}
{\b0 \cf32 \f0 \i0 \fs20
Professional and academic qualifications.
}
}
Bar Admission: Ontario, 1984
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf32 \f2 \i0 \fs20
Areas of practice.
}
}
Mergers and acquisitions; capital markets; banking and finance; private equity.
\par
}
}
}
}
}
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf32 \f2 \ri0 \i0 \qj \fs24 \li0
Steven D Bennett, Partner
\par
}
}
\u160\'3f
\par
}
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
\u160\'3f
}
{\b0 \cf30 \f2 \i0 \fs20
\par
}
{\b1 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
\par
}
}
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf32 \f0 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf32 \f0 \i0 \fs20
T
}
}
+1 416 869 5209
\par
}
{\b0 \cf32 \f0 \ri0 \i0 \qj \fs20 \li0
}
{\b0 \cf32 \f0 \i0 \fs20
E
}
}
{\b0 \cf32 \f0 \i1 \fs20
{\field {\*\fldinst HYPERLINK "mailto:sbennett@stikeman.com" }{\fldrslt
sbennett@stikeman.com
\par
}
{\b0 \cf32 \f0 \ri0 \i0 \qj \fs20 \li0
}
{\b0 \cf32 \f0 \i0 \fs20
W
}
}
{\b0 \cf32 \f0 \i1 \fs20
www.stikeman.com
\par
}
{\b0 \cf32 \f0 \ri0 \i0 \qj \fs20 \li0
}
{\b0 \cf32 \f0 \i0 \fs20
}
}
\par
}
}
}
\u160\'3f
\par
}
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf32 \f2 \ri0 \i0 \qj \fs20 \li0
{\b0 \cf32 \f2 \i0 \fs20
Areas of practice.
}
}
Mergers and acquisitions; securities; capital markets; mining; private equity;
corporate governance; life sciences and healthcare.
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Bar Admissions: Ontario, 2019, New York, 2018
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