CRA implies that PUC distributions by a CRIC of ordinary-course dividends from the subject corp can reverse a PUC grind from a prior actual or deemed investment in it

After providing preliminary responses at the 2014 IFA Roundtable, CRA did not say, "good enough for private-sector work," but instead refined and expanded its responses.  Some additional points, clarifications or responses:

• Q.1(b). On a suggestion that a failure to charge a fee for the provision by Canco of a guarantee of debt of a foreign subsidiary (Forco) will not give rise to an investment by it in the subsidiary under the foreign affiliate dumping rules because "Canco benefits from Forco's access to debt capital," CRA responded that there would be no benefit conferral "if fair market value consideration were… given in exchange for the guarantee and it would be reasonable… to conclude that a party dealing at arm's length would provide the guarantee on the same terms" (which kinda sounds like "no.")
• Q. 1(d). CRA comments imply that grinds to the PUC of cross-border classes of shares of CRIC resulting from investments by it in Forco (or in this case, from imputed investments) can be subsequently reversed through PUC distributions of dividends received in the ordinary course from Forco. See Example 9-D.
• Q. 3(c). CRA has not yet developed any specific positions on the application of the upstream loan rules to cash pooling arrangements.
• Q. 6. Of the 19 cases considered by the s. 95(6) Committee over the 2010-2013 period, it recommended that s. 95(6)(b) be applied in seven cases.

For reasons of completeness (or sloth), we have kept the original questions and notes on responses on our Roundtable page.  We have added links to the reformulated questions and responses (and to our summaries).

Neal Armstrong.  Summaries of May 2014 IFA Roundtable, Q. 1, 2014-0526691C6 under s. 212.3(9) and 212.3(10)(b), of May 2014 IFA Roundtable, Q. 3(c), 2014-0526741C6 under s. 90(14) and of May 2014 IFA Roundtable, Q.6, 2014-0526761C6 under s. 95(6)(b).