CRA recognizes cross-border client list utilization payments made to a U.S. resident as being Treaty-exempt

CRA considers that payments made to a U.S. resident (formerly, a Canadian resident) based on a Canadian purchaser’s use of a client list for a business previously carried on by the U.S. resident in Canada generally would be exempt, under Art. XII, para. 3 of the Canada-U.S. Treaty, from Part XIII tax otherwise applicable under s. 212(1)(d)(v) as being for the use of information concerning industrial or commercial experience.

Neal Armstrong.  Summaries of 21 April 2015 T.I. 2013-0494251E5 under Treaties – Art. 12 and s. 128.1(4).