CRA rules that a foreign common contractual fund is a co-ownership arrangement rather than a unit trust
Investors subscribe for units of “Subfunds” of an “Umbrella” fund, both situated in and governed by the laws of a redacted non-resident jurisdiction. The units are described both as a claim against the fund manager and as representing a co-ownership interest as tenant in common in the investment assets of a particular Subfund (with each Subtrust having a different focus as to the bonds or shares it invests in), which are managed by the non-resident fund manager on a discretionary basis and held by a non-resident custodian bank. A unit is specified to not "confer any interest or share in any particular part of the assets of the [funds]."
CRA ruled that the funds were fiscally transparent, so that a non-resident pension fund holding units in a Subfund that, in turn, held Canadian equities, could rely on its exempt pension fund status for Part XIII tax purposes.
This is similar to a less heavily redacted 2014 ruling on an Irish contractual fund (2013-0496831R3 – see also 2009-0345011R3 and 2006-0199741R3), whose description also looked somewhat similar to a unit trust, and was ruled upon to be a co-ownership arrangement.
Neal Armstrong. Summary of 2016 Ruling 2015-0606141R3 under s. 104(1).