Aco, which is described in its enabling legislation as an agent of the provincial Crown and is stated in such legislation to hold all its property as the Crown’s property (the “Deemed Ownership Provision”) (and also is not described in Reg. 4802(1)(b), (c) or (d)) invests in a corporation (Invesco) described in s. 149(1)(o.2)(i), (ii), (ii.1) or (iii) whose shares currently are owned by persons described in s. 149(1)(o.2)(iv) – or, alternatively, a wholly-owned subsidiary (Holdco) acquires such shares. In finding that Aco qualified as a prescribed person described in Reg. 4802(1)(e), CRA stated:
By virtue of the Deemed Ownership Provision … that deems the Crown to own all of Aco’s property, the Crown would be considered to own any shares of Invesco acquired by Aco.
In finding that Holdco so qualified under Reg. 4802(1)(g), it stated:
Holdco would be a “prescribed person” under paragraph 4802(1)(g) of the Regulations, because the shares of Holdco acquired by Aco would be deemed to be owned by the Crown by virtue of the Deemed Ownership Provision.
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|Tax Topics - Income Tax Act - Section 149 - Subsection 149(1) - Paragraph 149(1)(o.2) - Subparagraph 149(1)(o.2)(iv) - Clause 149(1)(o.2)(iv)(D)||deemed ownership clause in Crown corporation's statute applied for s. 149(1)(o.2)(iv) purposes||67|