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(l) exclusion after such a transfer, so that the FMV of the deferred share units would be included in computing the employee's income in the year of the transfer (to the extent that such value had not already been included), CRA stated: A transfer to another person would contravene the preamble to paragraph 6801(d), which requires that the agreement be between the corporation and the employee and that it be that employee who may receive amounts under the arrangement. Furthermore … the transfer of the employee's rights in the DSU Plan could indirectly allow the individual to access the value of the individual's rights before one of the times specifically identified in paragraph 6801(d)(i) … which would also contravene the requirements of paragraph 6801(d). ...

8 October 2010 Roundtable, 2010-0373211C6 F- Butterfly Transaction- Permitted Exchange-- summary under Paragraph 55(3.1)(b) Summary Under Tax Topics- Income Tax Act- Section 55- Subsection 55(3.1)- Paragraph 55(3.1)(b) issuance of shares by TC after the DC distribution without AOC of TC does not engage s. 55(3.1)(b) Where after a butterfly transaction, a family trust (whose beneficiaries are persons unrelated to the transferee corporation, the distributing corporation and their shareholders) acquires an interest in one of the transferee corporations by subscribing for shares of the capital stock of the latter for a nominal value, does this contravene s. 55(3.1)(b) given that an issuance of shares is not a disposition? ...