CRA considers a share subscription by FA Canadian parent as an “investment” by a “Canadian investor” for purposes of the s. 115.2 safe harbour

Where a foreign subsidiary (Forco) of a widely-held Canadian corporation (Canco) receives a treasury share subscription from Canco, this will taint the s. 115.2 safe harbour respecting management services provided by an affiliated Canadian investment manager.  CRA notes that this scenario is equivalent to Canco’s investment needs being serviced offshore "through" Forco, contrary to the policy of s. 115.2(2)(b)(i)(B).

Neal Armstrong.  Summary of 18 November 2014 TEI Roundtable, Q. E.6 under s. 115.2(2)(b)(i)(B).