DAC – Federal Court of Appeal refuses to allow a third party to intervene in the DAC (avoidance of CCPC status) case

The moving party (“QPG”) sought an order pursuant to Rule 109 of the Federal Courts Rules to permit it to intervene in the Crown’s appeal of the DAC decision, which found that there was no GAAR abuse in DAC continuing to the British Virgin Islands so as to cease to be a Canadian-controlled private corporation (CCPC).

In the DAC appeal, the parties had not put in issue the Minister’s designation of DAC as a CCPC in its notice of reassessment (nor was this relevant to or even mentioned by the Tax Court) whereas QPG wished to intervene on the issue of whether such a designation overrode the legislative criteria imposed by the Act for determining CCPC status.

Before dismissing the motion to intervene, Stratas JA stated that “[t]he issue raised by QPQ … seeks to reinvent the theory of the case” and that “[t]his is a classic case of a proposed intervention that, if allowed, will commandeer the parties’ case.”

Neal Armstrong. Summary of Canada v. DAC Investment Holdings Inc., 2025 FCA 37 under Federal Courts Rules, Rule 109.