2022 Ruling 2020-0859851R3 - Foreign accrual tax and underlying foreign tax

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Principal Issues: Whether the income tax paid to Country 1 by FA1 on its share of dividends paid by FA2 to USLP2 that is allocated to FA1 for the purposes of Country 1 Tax Law meets the definitions of “foreign accrual tax” and “underlying foreign tax” in the Act and the Regulations respectively.

Position: Subject to a possible maximum limitation and subject to the application of the foreign tax credit generator rules, Country 1 income tax paid by FA1 on the FA1’s share of the distributions paid by FA2 and consent dividends declared by FA2 will be “foreign accrual tax” and “underlying foreign tax” (as defined in the Act and the Regulations)

Reasons: Textual, contextual and purposive interpretation of the relevant provisions of the Act and the Regulations.

XXXXXXXXXX							2020-085985

XXXXXXXXXX, 2022

Dear XXXXXXXXXX:

Re: Advance Income Tax Ruling – XXXXXXXXXX.

This is in reply to your letter of XXXXXXXXXX requesting an advance income tax ruling on behalf of the above-named taxpayer. We also acknowledge the additional information provided to us in your emails and during our various telephone conversations in connection with your request.

We understand that, to the best of your knowledge and that of the taxpayer, except to the extent described herein, none of the transactions and/or issues in this letter are the same as or substantially similar to transactions and/or issues that are:

(i) in a previously filed tax return of the taxpayer or a related person;

(ii) being considered by a tax services office or tax centre in connection with a previously filed tax return of the taxpayer or a related person;

(iii) under objection by the taxpayer or a related person;

(iv) the subject of a current or completed court process involving the taxpayer or a related person; or

(v) the subject of a ruling request previously considered by the Directorate.

Unless otherwise expressly stated, every reference herein to the “Act” or to a part, section or subsection, paragraph or subparagraph and clause or subclause is a reference to the relevant provision of the Income Tax Act (Canada), R.S.C. 1985 (5th Supp.) c.1, as amended from time to time and consolidated to the date of this letter. Any reference to “Regulations” is to the Income Tax Regulations under the Act, C.R.C., c.945.

All references to dollar amounts are in U.S. dollars.

This Ruling is based solely on the Facts, Transactions, Additional Information, and Purpose of Transactions as described below.

I. DEFINITIONS

“active business” has the meaning assigned by subsection 95(1);

“arm’s length” has the meaning assigned by subsection 251(1);

“Canco” means XXXXXXXXXX, a corporation existing under XXXXXXXXXX;

“controlled foreign affiliate” has the meaning assigned in subsection 95(1);

“Country 1” means the United States of America;

“Country 1 Tax Law” means the U.S. Internal Revenue Code of 1986, as amended to the date hereof;

“CRA” means the Canada Revenue Agency;

“equity percentage” has the meaning assigned by subsection 95(4);

“excluded property” has the meaning assigned in subsection 95(1);

“FA1” means XXXXXXXXXX, a corporation incorporated under the General Corporation Law XXXXXXXXXX;

“FA2” means XXXXXXXXXX, a limited liability company formed under the laws XXXXXXXXXX;

“FA2 common shares” means common shares in the capital stock of FA2;

“FA2 preferred shares” means preferred shares in the capital stock of FA2 providing to the holder the right to vote, to have their shares redeemed at a fixed redemption amount of $XXXXXXXXXX per share and a fixed annual dividend entitlement of XXXXXXXXXX%;

“fair market value” means the highest price available in an open and unrestricted market between informed and prudent parties dealing at arm’s length and under no compulsion to act, and contracting for a taxable purchase and sale, expressed in terms of money or money’s worth;

“foreign accrual property income” has the meaning assigned in subsection 95(1);

“foreign accrual tax” has the meaning assigned in subsection 95(1);

“foreign affiliate” has the meaning assigned in subsection 95(1);

“GPco” means XXXXXXXXXX, a limited liability company existing under the laws XXXXXXXXXX;

“income from property” has the meaning assigned by subsection 95(1);

“Intermediate LP” means a limited partnership formed or to be formed under the laws of a state of Country 1;

“investment business” has the meaning assigned by subsection 95(1);

XXXXXXXXXX;

“Paragraph” refers to a numbered paragraph in this letter;

“Parentco” means XXXXXXXXXX, a corporation existing under XXXXXXXXXX;

“Property FA” means a limited liability company without share capital formed or to be formed under the laws of a state of Country 1;

“Property LP” means a limited partnership formed or to be formed under the laws of a state of Country 1 (for greater certainty, a Property LP does not including an Intermediate LP);

“Property Owner” refers to both the Property LPs and the Property FAs;

“public corporation” has the meaning assigned by subsection 248(1);

“REIT” means a “real estate investment trust” as defined in section 856(a) of the Country 1 Tax Law;

“related person” has the meaning assigned by subsection 251(2);

“share” has the meaning assigned by subsection 248(1) and includes all equity interests (within the meaning assigned by subsection 93.2(1)) in limited liability companies that are deemed to be shares under subsection 93.2(2);

“Subparagraph” refers to a numbered subparagraph in this letter;

“taxable Canadian corporation” has the meaning assigned by subsection 89(1);

“taxable capital gain” has the meaning assigned by paragraph 38(a);

“taxation year” has the meaning assigned in subsection 249(1);

“Transactions” means the transactions described in the Transactions segment of this letter;

“Treaty” means Canada-United States Income Tax Convention (1980), as amended;

“underlying foreign tax” has the meaning assigned in subsection 5907(1) of the Regulations;

“USLP1” means XXXXXXXXXX, a limited partnership existing under the laws XXXXXXXXXX;

“USLP1 Limited Partner Unit” means a partnership interest of a limited partner in USLP1, representing a fractional part of the interests of all such partners in USLP1. A limited partner is required to contribute capital to USLP1 upon admission to the partnership, and thereafter when required by the general partner. In connection with each capital contribution, the limited partner receives a number of USLP1 Limited Partner Units with an aggregate purchase price equal to the amount of the capital contribution (the price of each unit is equal to the most recent net asset value of USLP1 divided by the number of existing USLP1 Limited Partner Units). The net income (or loss) of USLP1 is generally allocated and distributed to the limited partners pro rata, based on the number of USLP1 Limited Partner Units held by each partner, subject to certain specified adjustments (e.g., for incentive allocations to the general partner). Limited partners may request the redemption of all or a portion of their USLP1 Limited Partner Units at the end of each fiscal quarter for a redemption price equal to the net asset value of USLP1 at that time, divided by the number of existing USLP1 Limited Partner Units (after the expiry of an initial lock-up period); the general partner will generally grant these requests provided that sufficient cash is available and certain other conditions are satisfied. The general partner may also require the redemption of all or a portion of a limited partner’s USLP1 Limited Partner Units.

“USLP2” means XXXXXXXXXX, a limited partnership existing under the laws XXXXXXXXXX.

“USLP2 Limited Partner Unit” means a partnership interest of a limited partner in USLP2, representing a fractional part of the interests of all such partners in USLP2. A limited partner is required to contribute capital to USLP2 upon admission to the partnership, and thereafter when required by the general partner. In connection with each capital contribution, the limited partner receives a number of USLP2 Limited Partner Unit with an aggregate purchase price equal to the amount of the capital contribution (the price of each unit is equal to the most recent net asset value of USLP2, divided by the number of existing USLP2 Limited Partner Units). The net income (or loss) of USLP2 is generally allocated and distributed to the partners pro rata, based on the number of USLP2 Limited Partner Units held by each partner, subject to certain specified adjustments (e.g., for incentive allocations to the general partner). Limited partners may request the redemption of all or a portion of their USLP2 Limited Partner Units at the end of each fiscal quarter; the general partner will generally grant these requests provided that sufficient cash is available and certain other conditions are satisfied. The general partner may also require the redemption of all or a portion of USLP2 Limited Partner Units.

II. FACTS

1. Parentco is a corporation resident in Canada for the purposes of the Act, a taxable Canadian corporation and a public corporation.

2. Canco is a corporation resident in Canada for the purposes of the Act and a taxable Canadian corporation.

3. Canco is XXXXXXXXXX, which carries on XXXXXXXXXX business in Canada and in countries other than Canada. Canco holds a diversified portfolio of investments XXXXXXXXXX. Canco is a wholly owned direct subsidiary of Parentco.

4. FA1 is a corporation resident in Country 1 for the purposes of the Act and the Treaty. Canco subscribed for and holds all of the issued and outstanding shares of FA1. FA1 is and will remain a controlled foreign affiliate of Canco throughout the period Canco owns any share of FA1 or any direct or indirect interest in such share.

5. GPco is a company resident in Country 1 for the purposes of the Act. GPco and Canco are related persons.

6. USLP1 is a partnership for the purposes of the Act and the Country 1 Tax Law. GPco is the general partner of USLP1 and holds a nominal economic interest in USLP1. FA1 is a limited partner of USLP1. As of XXXXXXXXXX, FA1 held XXXXXXXXXX. Other arm’s length and non-arm’s length investors acquired USLP1 Limited Partner Units through private placement offerings. Canco has not subscribed for and does not hold units of USLP1. No USLP1 Limited Partner Unit may be transferred without the prior written consent of GPco (but such consent may not be unreasonably withheld in the case of a transfer to an affiliate of the limited partner). GPco, and not the limited partners, has the responsibility for the management of USLP1 and has authority or right to act on behalf of USLP1 or to bind USLP1 in connection with any matter.

7. USLP2 is a partnership for the purposes of the Act and the Country 1 Tax Law. GPco is the general partner of USLP2. USLP1 holds a limited partner interest in USLP2. As of the date of this letter, USLP1 is the only limited partner of USLP2. No USLP2 Limited Partner Unit may be transferred without the prior written consent of GPco (but such consent may not be unreasonably withheld in the case of a transfer to an affiliate of the limited partner). GPco, and not the limited partners, has the responsibility for the management of USLP2 and has authority or right to act on behalf of USLP2 or to bind USLP2 in connection with any matter.

8. FA2 is a corporation resident in Country 1 for the purposes of the Act and the Treaty. USLP2 holds all of the issued and outstanding FA2 common shares and will remain the only owner of FA2 common shares during the period that Canco holds an indirect economic interest in them. At least XXXXXXXXXX arm’s length persons hold FA2 preferred shares. The FA2 common shares owned by USLP2 carry and will continue to carry with them the right to a majority of the votes in the election of the board of directors of FA2. FA2 elected to be classified as a corporation and as a REIT under the applicable provisions of the Country 1 Tax Law.

III. TRANSACTIONS

9. Some of the transactions described in the following Paragraphs were implemented after the rulings below were requested but prior to the date of this letter.

10. Canco has made contributions to the capital of FA1 without additional shares of FA1 being issued. The contributions have been made in tranches when USLP1 required such funds to make investments. The first tranche was made on XXXXXXXXXX. Prior to XXXXXXXXXX, USLP1 and USLP2 owned nominal assets. As of the date of this letter, Canco has invested $XXXXXXXXXX in USLP1 and USLP2 through FA1. Together with non-arm’s length persons, Canco has invested $XXXXXXXXXX in USLP1.

11. FA1 in turn has used the amount of capital contributions received from Canco as described in the previous Paragraph to subscribe for USLP1 Limited Partner Units with a fair market value equal to the subscription price paid. One or more arm’s length or non-arm’s length investors have also subscribed or will subscribe for USLP1 Limited Partner Units.

12. USLP1 has used the funds received from FA1 as described in the previous Paragraph to subscribe for USLP2 Limited Partner Units with an aggregate fair market value equal to the subscription price paid. The USLP2 Limited Partner Units are and will be USLP1’s only asset (other than cash temporary left in USLP1) during the period that Canco holds an economic interest in USLP1.

13. USLP2 has used the funds received as described in the previous Paragraph to subscribe for FA2 common shares with a fair market value equal to the subscription price paid. The FA2 common shares are and will be its only assets (other than cash temporary left in USLP2) during the period that Canco holds directly or indirectly any economic interest in USLP2.

14. FA2 has used or will use the funds received as described in the previous Paragraph to acquire, directly or through Intermediate LPs, shares or limited partnership interests in Property Owners. The specific legal entity structure used to invest in each real property may vary. The variations of the legal entity structures for the real property investments are described below.

15. Property LPs have been and will be formed for the purpose of acquiring real properties. Each Property LP is, and will be during the period that Canco owns a direct or indirect economic interest in it, a partnership for the purposes of the Act and the Country 1 Tax Law.

16. Property FAs have been and will be formed for the purpose of acquiring real properties. Each Property FA is, and will be during the period that Canco holds a direct or indirect economic interest in it, a corporation resident in Country 1 for the purposes of the Act. Each Property FA is, and will remain during the period that Canco holds a direct or indirect economic interest in it, disregarded or viewed as a partnership for the purposes of the Country 1 Tax Law, depending respectively on whether it has one or more than one member.

17. FA2 has acquired or will acquire an interest in the Property Owners, either directly or indirectly:

a. Where FA2 has made or will make a direct investment in a Property Owner, it has done or will do so by acquiring a limited partner interest in a Property LP or by acquiring shares of the capital stock of a Property FA.

b. Where FA2 has made or will make an indirect investment in a Property Owner, an Intermediate LP has been or will be formed. FA2 has acquired or will acquire a limited partner interest in the Intermediate LP, and the Intermediate LP has acquired or will acquire a limited partner interest in the Property LP or shares of the Property FA. Each Intermediate LP is, and will be during the period that Canco holds a direct or indirect economic interest in it, a partnership for the purposes of the Act and the Country 1 Tax Law.

c. Each Intermediate LP and each Property LP has (or if not formed yet, will have from the moment it is formed) a single general partner, which holds a general partner interest. This general partner will be a corporation, a limited liability company or a limited partnership formed under the laws of a state of Country 1 throughout the period over which Parentco will hold a direct or indirect economic interest in it. The same entity may be the general partner and hold a general partnership interest of multiple Intermediate LPs and/or Property LPs.

d. Arm’s length investors have also acquired shares of the capital stock or limited partnership interests in Property Owners at the time they are formed or will acquire such interests in the future. Should such arm’s length investor(s) acquire additional shares of the capital stock or limited partnership interests of the Property Owners after the initial investment, FA2 or Intermediate LP will retain more that XXXXXXXXXX% of the votes and value in each Property Owner throughout the period over which Canco will hold a direct or indirect economic interest in it. It is anticipated that only persons or partnerships dealing at arm’s length with Canco will hold shares of the capital stock or limited partnership interests of Property Owners.

18. Each Property Owner described in the previous Paragraph has acquired or will acquire one or more real properties and will lease the real property(ies) to generate rental income.

19. FA2 and each Property FA in which it directly owns shares are and will remain controlled foreign affiliates of USLP2 during the period that Canco holds a direct or indirect economic interest in them. Each Property FA that is owned by an Intermediate LP is and will remain a controlled foreign affiliate of that Intermediate LP during the period that Canco holds an economic interest in it.

20. As of the date of this letter, FA2 and the Property FAs are foreign affiliates of Canco for the purposes of the “specified provisions” described in subsection 93.1(1.1).

21. As of the date of this letter, FA1 has an equity percentage of greater than XXXXXXXXXX% in FA2 and in each of the Property FAs (in which FA1 already has an economic interest) due to its indirect ownership interest in USLP2 (through its direct ownership interest in USLP1).

22. In each year that FA1 holds USLP1 Limited Partner Units:

a. For the purposes of the Act, FA1, FA2 and each Property FA will carry on an investment business, rather than an active business, and their income will consist solely of, or a combination of, income from property or taxable capital gains from the disposition of property other than excluded property. From the perspective of FA2, each Property LP and Intermediate LP will likewise carry on an investment business and their income will consist solely of, or a combination of, income from property or taxable capital gains from the disposition of property other than excluded property.

b. Each Property Owner made (except for those that will be created after the date of this letter) and will make yearly pro rata distributions to its members, in an aggregate amount at least equal to its income for the year as determined for the purposes of the Country 1 Tax Law. In the case of a Property LP, such distributions were (where relevant) and will be pro rata distributions to its limited partners. In the case of a Property FA, such distributions were (where relevant) and will be pro rata distributions on all the shares of a class as described in the conditions of application of subsection 90(2).

c. Where a member of a particular Property Owner is an Intermediate LP, the Intermediate LP will make yearly pro rata distributions to its limited partners in an aggregate amount at least equal to the distributions it receives from the Property Owner in the year.

d. FA2 will make yearly distributions on the FA2 common shares and FA2 preferred shares as described in the conditions of application of subsection 90(2) to its shareholders (almost all of which will be received by USLP2, except for nominal distributions to the owners of FA2 preferred shares) in an aggregate amount at least equal to its taxable income for the year for the purposes of the Country 1 Tax Law. Such taxable income will consist of FA2’s share of the income earned by the Property Owners from their respective real property businesses and potentially FA2’s share of capital gains realized on the disposition of the rental properties and/or capital gains on the disposition of the shares of the capital stock of Property FAs or partnership interests in Property LPs and Intermediate LPs.

23. Each of FA1, FA2, USLP1 and USLP2 has a XXXXXXXXXX taxation year end or a fiscal period end. It is expected that the taxation year end or fiscal period end of all Property Owners and Intermediate LPs will also be XXXXXXXXXX.

IV. ADDITIONAL INFORMATION

24. For the purposes of Country 1 Tax Law, (i) each partnership and each fiscally transparent entity that is treated as a partnership (such as a Property FA with more than one member) is required under the Country 1 Tax Law to compute its own income, and (ii) each member (either FA2 or Intermediate LP, as the case may be) of a single member Property FA is required to compute its income in respect of that Property FA.

25. For the purposes of Country 1 Tax Law, (i) a Property FA that has more than one member is treated as a partnership, therefore a disposition of the shares of such Property FA is treated as a disposition of a partnership interest; and (ii) a single member Property FA is treated as a disregarded entity, therefore a disposition of the shares of a single member Property FA is treated as a disposition of the assets of the Property FA and may give rise to a “recaptured depreciation” that is treated as ordinary income under the Country 1 Tax Law. A disposition of a partnership interest may also, in certain circumstances, result in the partnership being deemed to have disposed of its assets, thereby possibly giving rise to, for example, a “recaptured depreciation” that is treated as ordinary income under the Country 1 Tax Law. Under the Country 1 Tax Law, a net capital gain or loss is fully included in income of a corporate taxpayer and taxed at the same rates as its ordinary income.

26. Under the Country 1 Tax Law, the members of USLP1 are taxable on their respective shares of any income they derive through USLP1; and the members of USLP2 are taxable under the Country 1 Tax Law on their respective shares of any income they derive through USLP2.

27. Under the REIT provisions of the Country 1 Tax Law, FA2 is subject to Country 1 corporate income tax on its income as determined under the Country 1 Tax Law. Such income includes (i) the income earned by wholly owned entities that are treated as disregarded entities for Country 1 tax purposes, such as the Property FAs that are directly owned by FA2; and (ii) its allocable share of the income earned by partly owned entities that are treated as partnerships for Country 1 tax purposes, such as the Property LPs and partly-owned Property FAs the interests in which are owned by FA2, and the Intermediate LPs (each Intermediate LP’s income includes its allocable share of the income earned by fiscally transparent entities that are wholly or partly owned by that Intermediate LP, such as the Property Owners held by Intermediate LPs).

28. For the purposes of the Country 1 Tax Law, FA2 is entitled to deductions from its taxable income to the extent that it makes distributions to its shareholders (including USLP2). FA2 is required to make distributions to its shareholders in respect of a particular year that are equal to at least XXXXXXXXXX% of its ordinary taxable income for the year. FA2 is generally expected to make distributions in a particular year that are at least equal to its taxable income for the year. Accordingly, FA2 is generally not expected to pay income tax in Country 1.

29. FA2 will generally distribute before the end of every taxation year to its shareholders cash in an aggregate amount equal to its taxable income for the taxation year. However:

• FA2 might declare a dividend during a given taxation year, and pay the dividend in January of the subsequent taxation year, with such dividend being included in the shareholders’ income in the year that includes the time it is declared;
• FA2 might declare and pay a dividend in the taxation year that follows a given taxation year, provided that (1) the dividend is declared before the due date for filing its tax return for the given taxation year, and (2) the dividend is paid within 12 months of the end of the given taxation year (and is paid on or before the date of FA2’s next regularly scheduled dividend payment);
• FA2 might declare a consent dividend; this is a dividend that is not actually paid to shareholders, but is deemed under Country 1 Tax Law to be distributed to shareholders on the last day of the given taxation year and then deemed to be contributed to FA2 (as additional paid-in capital) on the same day.

30. FA1 will include in its income that is subject to tax in Country 1 its share of the income of USLP1 as determined under the Country 1 Tax Law, which will include the distributions received by USLP2 from FA2.

31. If in a specific taxation year FA2 distributes an amount greater than its taxable income as computed under the Country 1 Tax Law, the amount that is included in FA1’s taxable income under the Country 1 Tax Law for that year in that respect will be limited to FA1’s portion of the taxable income of FA2. The excess distribution will be treated as a return of capital and not included in taxable income of FA2 under the Country 1 Tax Law.

32. FA1 will not be part of a consolidated group for Country 1 Tax Law purposes.

33. Neither of FA1, USLP1, USLP2, FA2, an Intermediate LP, a Property LP, or a Property FA will incur an interest-bearing debt obligation owing directly or indirectly to a foreign affiliate of Canco or a related corporation.

34. The proportion of the economic interest held by FA1 directly or indirectly in USLP2 is expected to decline over time due to arm’s length investors subscribing for new USLP1 or USLP2 Limited Partner Units. It is expected that FA2 and the Property FAs will eventually cease to be foreign affiliates of Canco for the purposes of the “specified provisions” described in subsection 93.1(1.1). FA2 will remain a foreign affiliate of USLP2.

V. PURPOSE OF THE TRANSACTIONS

The purpose of Canco’s investment in FA1, and FA1’s investment in USLP1, is and will remain to invest in a real estate investment fund that owns interests in real estate in Country 1 and XXXXXXXXXX (and more specifically, to geographically diversify Canco’s investment portfolio by XXXXXXXXXX).

The purpose of the formation of FA2, the Intermediate LPs and the Property Owners is and will be to form a real estate investment fund structure to invest in real estate in Country 1 and earn income from such real estate for its investors (in particular, the Intermediate LPs will be formed to facilitate investments in the Property Owners by arm’s length investors, in addition to the investments by FA2).

VI. RULINGS GIVEN

Provided that the preceding statements constitute a complete and accurate disclosure of all the relevant facts, transactions, additional information, purposes of the Transactions, and provided further that the Transactions, were and, if repeated, will be completed in the manner described above, and there are no other transactions that may be relevant to the rulings given, we rule as follows:

A. Country 1 income tax paid by FA1 on FA1’s share of the distributions paid by FA2 described in Subparagraph 22d and of the consent dividends described in Subparagraph 29c will be “foreign accrual tax” (as defined in subsection 95(1)) applicable to amounts that are included in Canco’s income under subsection 91(1) in respect of the FA1 shares, to the extent that those distributions and the consent dividends can reasonably be regarded as distributions of amounts that are included, directly or indirectly, in computing income of USLP2 under subsection 91(1).

B. If, at any time in a particular taxation year, the total equity percentage in FA2 of Canco, and of persons related to Canco taking into account the rules in subsection 93.1(1) is at least 10%, Country 1 income tax paid by FA1 for that year on FA1’s share of the distributions paid by FA2 described in Subparagraph 22d and of the consent dividends described in Subparagraph 29c will not be underlying foreign tax of FA1 in respect of Canco by reason of the application of subsection 5907(1.03) of the Regulations.

C. In a particular taxation year of FA1 throughout which the total equity percentage in FA2 of Canco, and of persons related to Canco taking into account the rules in subsection 93.1(1) is less than 10%, Country 1 income tax paid by FA1 for that year on FA1’s share of the distributions paid by FA2 described in Subparagraph 22d and of the consent dividends described in Subparagraph 29c will be underlying foreign tax of FA1 in respect of Canco to the extent that those distributions and the consent dividends can reasonably be regarded as distributions of amounts that are included, directly or indirectly, in computing income of USLP2 under subsection 91(1).

The above Rulings are given subject to the limitations and qualifications set out in Information Circular 70-6R12 last updated on April 1, 2022 and are binding on the CRA in respect of the Transactions that were undertaken on or after XXXXXXXXXX and the Transactions that will be repeated within XXXXXXXXXX of the date of this letter. A supplementary ruling letter can be requested to extend the Rulings given above to Transactions implemented after that period.

VII. COMMENTS

Nothing in this letter should be construed as implying that the CRA has confirmed, reviewed or made any determination in respect of any tax consequences relating to the Facts, Transactions, Additional Information or any transaction or event taking place either prior or subsequent to the implementation of the Transactions, whether described in this letter or not, other than those specifically described in the Rulings given above.

An invoice for our fees in connection with this ruling will be forwarded to you under separate cover.

Yours truly,

XXXXXXXXXX
Acting Manager
for Division Director
International Division
Income Tax Rulings Directorate