6 July 1994 External T.I. 9412535 - RRSP QUALIFIED PROPERTY DEBT OF COOPERATIVE

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.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues:Are proposed debentures RRSP qualified

Position TAKEN:can not provide a ruling

Reasons FOR POSITION:Determining factors can not be controlled or determined before the time of acquisition

XXXXXXXXXX		3-941253

Attention: XXXXXXXXXX

July 6, 1994

Dear Sirs:

Re: Advance Income Tax Ruling Request
XXXXXXXXXX

This is in reply to your letter of May 5, 1994, in which you requested an advance income tax ruling on behalf of XXXXXXXXXX

As discussed during our telephone conversation of June 8, 1994, (XXXXXXXXXX - Harding) an advance ruling is a written statement provided by the Department stating how it will interpret specific provisions of existing Canadian income tax law to definite transactions being contemplated by a taxpayer. They are also issued on questions of fact but only if the material facts can reasonably be expected to prevail at the time of a proposed transaction.

We have examined your request and determined that we can not issue any rulings with respect to your proposal because it does not comply with the above requirements. In particular, it does not comply as follows:

Your request pertains to the issue of debentures of the cooperative on a recurring basis. It does not deal with a definite transaction or specific series of transactions.

The cooperative is not in a position to established that all material facts can reasonably be expected to prevail at all times. That is:

it can not establish beforehand and on a reasonable basis that an average of 100 qualified RRSPs will acquire and continue to hold the debentures throughout the period during which each RRSP holds the debentures; and

it can not establish with reasonable certainty, that the aggregate number of shareholders of the cooperative will exceed 100 at all relevant times.

We are also not prepared to issue any rulings that will only be binding provided these requirements are met since such rulings would not provide any assurances on which an RRSP trustee could base any decisions.

Your deposit will be returned under separate cover.

Yours truly,

for Director
Financial Industries Division
Rulings Directorate