CRA indicates that a licence has an indefinite life if “in the circumstances” it is “reasonably” certain it can be renewed

Class 14 properties can include a “concession or licence for a limited period.” In IT-477 (Archived), CRA stated:

Where… renewals or extensions are automatic or within the control of the taxpayer, that is they do not require any further negotiation with or the concurrence or consent of the grantor, the life of the property includes such additional periods. … Where the taxpayer has an option to renew or extend the term only if certain conditions are met, for instance meeting certain performance or sales criteria, the circumstances of the particular case must be examined to determine whether or not, when he acquired the property, it was reasonably certain that these conditions would be met. If so, the additional periods are included in the life of the property.

Post-Shell, the last sentence is dubious and, as discussed below, even the first sentence could be questioned.

In a recent technical, CRA referred to the above passage before finding that a government licence which could be renewed each year on the payment of a fee was an eligible capital property rather than a Class 14 property, i.e., the taxpayer had the right to renew on tendering the fee, so that presumably the first sentence in the above passage applied. Is this consistent with the proposition that a lessee with a bargain purchase option is not the property owner (see 2008-0303651E5)?

Neal Armstrong. Summary of 30 July 2015 T.I. 2014-0552041E5 F under Sched. II – Class 14.