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I agree with the learned trial judge that subsection 110(5) does not apply in this case because the provision from the tax convention quoted above excludes it. Apart from the convention, as it appears to me, the situation is that, at the time of the tax convention, a non-resident could elect, in respect of a year when he was paid an amount as rent on real property in Canada, to file a return under Part I, in which event he became. liable to pay tax under Part I as though the real property in Canada were his only source of income and he was not bound to file such a return in respect of a subsequent year when he disposed of the property so as to become liable to “recapture”, but, after 1955, if a non-resident so elected to pay tax under Part I In respect of a year when he was paid such an amount as rent, it carried with it a liability, by virtue of the new subsection 110(5), to file a return in respect of the year of disposition and to pay any tax arising from the “recapture” provision in subsection 20(1). ...

The question is whether or not he is entitled under paragraph 11(1)(ia) to deduct convention expenses. I quote the section because it is short: 11. (1) Notwithstanding paragraphs (a), (b) and (h) of subsection (1) of section 12, the following amounts may be deducted in computing the income of a taxpayer for a taxation year: (ia) an amount paid by the taxpayer in the year as or on account of expenses incurred by him in attending, in connection with a business or profession carried on by him, not more than two conventions held during the year by a business or professional organization; There is no doubt that the conventions in question were held by business or professional organizations, nor is there any doubt—in fact, it is admitted—that the degree of success and study that Mr MacDonald has put into his vocation would qualify him as a professional within the meaning in my decision in Axler & Palmer Ltd v MNR, [1973] CTC 2167; 73 DTC 119. ...

Dans le but de faciliter la perception et la remise de l’impôt établi ar la présente loi, ou de prévenir le double payement de cet impôt sur le même bien mobilier, le ministre peut faire avec un vendeur telles conventions qu’il jugera à propos et telles conventions seront sujettes à la présente loi. ... Au moment où elle cessait de faire affaires, la défenderesse avait certaines marchandises qu’elle avait dû reprendre, parce que les acheteurs ne payaient pas suivant les conventions. ...

The sole issue in the appeal is whether payments totalling $115,000 (US) made by the respondent, a Canadian resident, to an American resident, Wonder International Ltd (hereafter Wonder), are subject to the 15% tax im- posed by paragraph 212(1)(d) of the Income Tax Act, RSC 1952, c 148, as amended by section 1 of SC 1970-71-72, c 63 and by Article XI of the Canada- US Tax Convention*. [1] The companion appeal (A-323-79) involves exactly the same issue and involves payments totalling $75,000 by the respondent to Wonder. ... [9] For the foregoing reasons, I would dismiss the appeal with costs. 1 The relevant portion of the Protocol reads as follows: PROTOCOL At the moment of signing the Convention for the avoidance of double taxation, and the establishment of rules of reciprocal administrative assistance in the case 2 t The relevant portion of paragraph 212(1)(d) and Article XI of the Canada-US Tax Convention read as follows: 212.(1) Every non-resident person shall pay an income tax of 25% on every amount that a person resident in Canada pays or credits, or is deemed by Part I to pay or credit to him as, on account or in lieu of payment of, or in satisfaction of,... ... ARTICLE II Il For the purpose of this Convention, the term “industrial and commercial profits” shall not include income in the form of rentals and royalties, interest, dividends, management charges, or gains derived from the sale of exchange of capital assets. ...

XI (1) of the Convention) but in respect of its industrial and commercial profits attributable to its activity in the United States and determined in accordance with Art. I of the Convention. Industrial and commercial profits do not include interest. ... Reciprocal Tax Convention in respect of income derived from sources in the United States and that this withholding tax is a tax on income not profits. ...

In that tax return, the appellant claimed an exemption from income tax on the salary she earned that year from her employment with the Mission on the ground that the salary was not taxable in Canada pursuant to article 19 of the Convention between the Government of Canada and the Swiss Federal Council for the Avoidance of Double Taxation with respect to Taxes on Income and on Capital ... On March 6, 2007, the appellant again wrote to the International Tax Services Office to ask to be relieved of the obligation to pay taxes in Canada because of the provisions of the Convention between the Government of Canada and the Swiss Federal Council for the Avoidance of Double Taxation with respect to Taxes on Income and on Capital.   12.    ... The decisions of the Federal Council on permanent missions and their staff members and the Federal Council on Swiss foreign policies are not agreements or conventions entered into by one or more foreign countries and do not have the force of law in Canada.   ...

[2] (the 1942 Treaty) and the Canada- United States Tax Convention (1980)$ [3] (the 1980 Treaty) operate to preclude the application of subsection 18(4). ... Appeal dismissed. 1 's.C. 1970-71-72, c.63, as amended. 2 ^Convention and Protocol Between Canada and the United States of America for the Avoid ance of Double Taxation and the Prevention of Fiscal Evasion in the Case of Income Taxes, being Schedule I of the Canada-United States of America Tax Convention Act, 1943, 7 Geo. VI, c.21. 3 Convention Between Canada and the United States of America with respect to Taxes on Income and on Capital, being Schedule I of the Canada-United States Tax Convention Act, 1984, S.C. 1984, c. 20. 4 Before the Tax Court, the Appellant also argued that Article XXX(V) of the 1980 Treaty applied to its 1984 and 1985 taxation years. ...

Relevant Statutory Provisions [7]                The relevant provisions of the ITA and the ITR are as follows: 66(15)   "flow-through share" means a share (other than a prescribed share) of the capital stock of a principal-business corporation that is issued to a person under an agreement in writing entered into between the person and the corporation after February 1986, under which the corporation agrees for consideration that does not include property to be exchanged or transferred by the person under the agreement in circumstances in which section 51, 85, 85.1, 86 or 87 applies   (a) to incur, in the period that begins on the day the agreement was made and ends 24 months after the end of the month that includes that day, Canadian exploration expenses or Canadian development expenses in an amount not less than the consideration for which the share is to be issued, and   (b) to renounce, before March of the first calendar year that begins after that period, in prescribed form to the person in respect of the share, an amount in respect of the Canadian exploration expenses or Canadian development expenses so incurred by it not exceeding the consideration received by the corporation for the share,   and includes a right of a person to have such a share issued to that person and any interest acquired in such a share by a person pursuant to such an agreement.     66(15)   « action accréditive » ¯¯¯ « action accréditive » Action du capital-actions d’une société exploitant une enterprise principale, à l’exclusion d’une action visée par règlement, émise en faveur d’une personne conformément à une convention écrite conclue après février 1986 entre cette personne et la société et par laquelle la société s’oblige, pour une contrepartie qui ne comprend pas un bien que la personne doit échanger ou transférer aux termes de la convention dans des circonstances où les articles 51, 85, 85.1, 86 ou 87 s’appliquent :   a) d’une part, à engager, au cours de la période commençant à la date de conclusion de la convention et se terminant 24 mois après la fin du mois qui comprend cette date, des frais d’exploration au Canada ou des frais d’aménagement au Canada pour un montant total au moins égal au paiement prévu pour l’action;   b) d’autre part, à renoncer en ce qui concerne l’action en faveur de cette personne, avant mars de la première année civile commençant après cette période, sur le formulaire prescrit, à un montant au titre des frais ainsi engagés qui ne dépasse pas le paiement reçu par la société pour l’action;   le droit d’une personne à l’émission d’une telle action et tout droit sur une telle action acquis par une personne conformément à une telle convention sont assimilés à une action accréditive.   66.3(3) Any flow-through share (within the meaning assigned by subsection 66(15)) of a corporation acquired by a person who was a party to the agreement pursuant to which it was issued shall be deemed to have been acquired by the person at a cost to the person of nil.     66.3(3) La personne qui acquiert une action accréditive – au sens du paragraphe 66(15) – auprès d’une société et qui est partie à la convention relative à l’émission de l’action est réputée acquérir celle-ci à un coût nul. 6202.1(1)(c)(i)   For the purposes of the definition "flow-through share" in subsection 66(15) of the Act, a new share of the capital stock of a corporation is a prescribed share if, at the time it is issued,   (c) any person or partnership has, either absolutely or contingently, an obligation (other than an excluded obligation in relation to the share) to effect any undertaking, either immediately or in the future, with respect to the share or the agreement under which the share is issued (including any guarantee, security, indemnity, covenant or agreement and including the lending of funds to or the placing of amounts on deposit with, or on behalf of, the holder of the share or, where the holder is a partnership, the members thereof or specified persons in relation to the holder or the members of the partnership, as the case may be) that may reasonably be considered to have been given to ensure, directly or indirectly, that   (i) any loss that the holder of the share and, where the holder is a partnership, the members thereof or specified persons in relation to the holder or the members of the partnership, as the case may be, may sustain by reason of the holding, ownership or disposition of the share or any other property is limited in any respect, or   [Emphasis added.] 6202.1(1) c)(i)  Pour l’application de l’alinéa 66(15) d.1) de la Loi, est une action exclue l’action nouvelle du capital-actions d’une sociétée si au moment de son emission, selon le cas: c) une personne ou une société de personnes a l’obligation, conditionnelle ou non (à l’exception d’une obligation exclue relative à l’action), de fournir un engagement, immédiat ou futur, relatif à l’action ou à la convention en vertu de laquelle l’action est émise – notamment une garantie, une sûreté, une promesse ou un accord et y compris le dépôt d’un montant ou le prêt de fonds au détenteur de l’action ou, si celui-ci est une société de personnes, aux associés de celle-ci ou aux personnes apparentées au détenteur de l’action ou aux associés, ou pour le compte des uns ou des autres – qu’il est raisonnable de considérer comme donné pour faire en sorte, directement ou indirectement: (i) qui soit limitée d’une façon quelconque toute perte que le détenteur de l’action et, si celui-ci est une société de personnes, les associés de celle-ci ou les personnes apparentées au détenteur de l’action ou aux associés peuvent subir parce qu’ils détiennent l’action ou un autre bien, en sont propriétaires ou en disposent, ou   [Je me souligne.]   ...

He applied for convention refugee status but was denied in October, 1993 by the Immigration Board. ... Kwawukumey, that he was unsuccessful in his application for convention refugee status.                 5.              ... For someone to qualify as an eligible individual under section 122.6 of the Act required more than mere residence: it required citizenship, permanent residence, visitor status, holder of a permit or convention refugee status. ...

Canada, [1995] 2 S.C.R. 802, said in paragraph 46 thereof: [46] At this point in the analysis, it is important to take a step backwards and isolate exactly whom the Convention was intended to benefit. ... It was deemed important, in order to promote international trade between Canada and the U.S., to spare such individuals and corporations double taxation (consequently promoting the equitable allocation of profits of enterprises doing business in both countries): see Preamble to the Convention; see also Utah Mines Ltd. v. ... Tax Treaty (the "Convention") reads as follows: Canada and the United States of America, desiring to conclude a Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital, have agreed as follows: Article IV, under the heading "Residence", contains what is considered the tie breaker rules in paragraph number 2, which reads: 2. ...