Multilateral Instrument

Table of Contents

Multilateral Instrument
Article 4
Finance(1)
Article 6
Articles(1)
Article 6(1)
Articles(1)
Article 7
Articles(2)
Article 7(1)
Cases(1)
Administrative Policy(9)
Finance(1)
Articles(5)
Article 7(4)
Articles(1)
Article 8
Article 8(1)
Administrative Policy(1)
Article 13
Articles(1)
Article 19
Finance(1)
Articles(1)
Article 20
Articles(1)
Article 28
Article 28(2)
Articles(2)

Article 4

Finance

14 May 2019 IFA Conference – Stephanie Smith on MLI – MLI Progress

When the Notice of Ways and Means motion for the implementation of MLI was tabled, Canada indicated that it would adopt additional provisions of...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Multilateral Instrument - Article 19 majority of arbitration Articles provide for baseball-style arbitration 57

Article 6

Articles

Michael N. Kandev, "Taxpayer Wins Treaty Shopping Challenge in Alta Energy Luxembourg", Tax Management International Journal, 14 September 2018, p. 572

Quaere whether Alta Energy suggests a restrictive interpretation of the implications of the MLI-directed preamble or PPT (p. 566)

If the Tax...

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Article 6(1)

Articles

David G. Duff, "Tax Treaty Abuse and the Principal Purpose Test – Part 2", Canadian Tax Journal, (2018) 66:4, 947-1011

Preamble effectively overrides Union of India approach (p. 891)

[I]t is necessary to consider not only the primary arm of the CTA to encourage...

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Article 7

Articles

Manal Corwin, Jesse Eggert, "Understanding the Operation, Impact, and Practical Implications of the MLI", Tax Management International Journal, Vol. 46, No. 8, 11 August 2017, p. 407

Breadth of principal purpose test in MLI, Art. 7(1) compared to existing PPT rules (p. 413)

This expression of the PPT is broader than many...

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Jack Silverson, Bill Corcoran, "Issues Affecting Investments by Canadian Pension Plans in Private Equity, Infrastructure and Real Estate in Canada, the USA and Europe", 2016 Conference Report (Canadian Tax Foundation),15:1-40

Application of PPT to a Canadian pension fund co-investing in Europe through e.g. a Luxco (pp. 15:32-35)

A pension plan seeking to invest in...

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Article 7(1)

Cases

Revenue & Customs v Burlington Loan Management DAC, [2024] UKUT 152

BLM was a substantial Irish-resident investment company, which had been acquiring proved claims in the administration of Lehman Brothers...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 12 Irishco’s purchasing a UK interest claim from Caymansco at a tax arbitrage price did not have Treaty-reduction as a main purpose 542

Administrative Policy

15 May 2024 IFA Roundtable Q. 7, 2024-1007641C6 - Principal Purpose Test in the Multilateral Instrument

How would the principal purpose test (PPT) in Art. 7(1) of the Multilateral Instrument (MLI) apply in the following situations?

Situation (a)

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 10 application of PPT where Treaty-resident pure holdco with ultimate Treaty-resident parent received Canco dividends 411

15 May 2024 IFA Roundtable Q. 1, 2024-1007651C6 - Principal purpose test and the UK-Canada Tax Treaty

2019-0792651I7 concluded that Art. 10(8) of the Canada-UK Treaty would deny the Treaty dividend withholding tax rate reduction where a UK-resident...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 10 marginally increasing a shareholding to access the Treaty-reduced rate likely would not engage the PPT 217

17 May 2023 IFA Roundtable Q. 7, 2023-0964521C6 - Application of Article 10, Canada-Hong Kong

Two long-time residents of Hong Kong (Mr. and Mrs. A) each transferred 50% of the shares of Canco to a new Hong Kong company. Leaving aside the...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 10 violating main purpose test in HK Treaty increases dividend rate/ PPT object and purpose test not violated by using personal holding company in same jurisdiction 336

17 May 2022 IFA Roundtable Q. 12, 2022-0926361C6 - Principal Purpose Test (PPT)

Regarding a query as to any applications by CRA of the principal purpose test (“PPT”) under Art. 7(1) of the MLI, CRA stated:

[T]he CRA has...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) PPT approach can inform GAAR analysis 199

5 May 2021 IFA Roundtable, Q.2

Has the CRA issued any assessments based on the principal purpose test (“PPT”), and what are the fact patterns in any ruling requests on the...

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27 October 2020 CTF Roundtable Q. 6, 2020-0862471C6 - MLI and Principal Purpose Test

Can the CRA provide examples of any fact patterns on which rulings have been requested or granted under the MLI; and any fact patterns on which...

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3 December 2019 CTF Roundtable Q. 1, 2019-0824551C6 - Multilateral Instrument (“MLI”)

Can CRA provide an update on the measures that were put in place for the administration of the “principal purpose test” (“PPT”) contained...

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16 May 2018 IFA Roundtable Q. 2, 2018-0749181C6 - Principal Purpose Test in MLI

What weight will CRA to the examples in paras. 182 and 187 of the Commentary on Art. 29 of the 2017 OECD Model respecting whether a structure or...

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21 November 2017 CTF Roundtable Q. 8, 2017-0724151C6 - Principal Purpose Test

(a) GAAR Committee

Will the GAAR Committee review all situations where an auditor proposes to apply the principal purpose test in MLI Art. 7(1)...

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Finance

14 May 2019 IFA Conference – Stephanie Smith on MLI – GAAR and PPT

Question: How to the GAAR and PPT interact?

Stephanie Smith indicated that the implementing bill provides that, to the extent of any inconsistency...

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Articles

Michael Kandev, John Lennard, "The OECD Multilateral Instrument: A Canadian Perspective on the Principal Purpose Test", Bulletin for International Taxation, January 2020, p. 54

Assimilation of series of transactions to concept of “arrangement or transaction” (p 56)

[I]n the context of the PPT, the expression...

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Nelson Whitmore, Owen Strychun, "Canadian Inbound Investment After the MLI", Canadian Tax Journal, (2019) 67:3, 831-80

Relative priority of PPT and GAAR (pp. 860-862)

… Arnold states [fn 117: Brian Arnold, “Canada Adopts the Multilateral Legal Instrument,”...

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Ian Zahra, "The Principal Purpose Test: A Critical Analysis of Its Substantive and Procedural Aspects – Part I", Bulletin for International Taxation, November 2019, p. 609

OECD interpretation of “principal purpose” (p. 614)

[W]hat is a principal purpose? The OECD interprets such a consideration by stating that a...

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Michael N. Kandev, John J. Lennard, "Interpreting the Expression 'Arrangement or Transaction' in the Principal Purpose Test of the MLI", International Tax (Wolters Kluwer CCH), June 2019, No. 106, p. 1

No Canadian domestic definition of the phrase “arrangement or transaction” (p.3)

While Canada’s ITA uses the words “arrangement” and...

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Words and Phrases
arrangement or transaction series

David G. Duff, "Tax Treaty Abuse and the Principal Purpose Test – Part 2", Canadian Tax Journal, (2018) 66:4, 947-1011

Meaning of transaction (p. 972)

[W]hile the official French version of the ITA translates “transaction” as “operation,” which is defined...

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Article 7(4)

Articles

David G. Duff, "Tax Treaty Abuse and the Principal Purpose Test – Part 2", Canadian Tax Journal, (2018) 66:4, 947-1011

Limited adoption and poor drafting of remedial benefits rule

[T]he MLI contains a remedial benefits rule … [fn 277 Article 7(4) … .]

Of the 84...

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Article 8

Article 8(1)

Administrative Policy

27 November 2018 CTF Roundtable Q. 3, 2018-0779891C6 - MLI Issues

General overview of the introduction of the MLI including statement that:

On May 28, 2018, the Minister of Finance tabled a Notice of Ways and...

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Article 13

Articles

Manal Corwin, Jesse Eggert, "Understanding the Operation, Impact, and Practical Implications of the MLI", Tax Management International Journal, Vol. 46, No. 8, 11 August 2017, p. 407

Potential uncertainty under existing PE Articles created by MLI Art 13 (p. 414)

MLI Article 13 is intended to address artificial avoidance of PE...

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Article 19

Finance

14 May 2019 IFA Conference – Stephanie Smith on MLI – MLI Progress

Approximately 20 of Canada’s treaties will be updated to include arbitration. Of those 20, 13 have agreed to Canada’s preference for last best...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Multilateral Instrument - Article 4 post MLI, most of Canada’s treaties will have a residence tie-breaker rule 78

Articles

Gerrit Groen, "The Nature and Scope of the Mandatory Arbitration Provision in the OECD Multilateral Convention (2016)", Bulletin for International Taxation, November 2017, p. 607

Only cases where taxes have been charged are covered (p. 611)

Under the wording of article 19(l)(a) of the MLI, only cases where taxes have...

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Article 20

Articles

Gerrit Groen, "The Nature and Scope of the Mandatory Arbitration Provision in the OECD Multilateral Convention (2016)", Bulletin for International Taxation, November 2017, p. 607

Nature of specific case mutual agreement procedure under OECD Model (p. 609)

Once the taxpayer has filed an application for a specific case MAP...

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Article 28

Article 28(2)

Articles

Gerrit Groen, "The Nature and Scope of the Mandatory Arbitration Provision in the OECD Multilateral Convention (2016)", Bulletin for International Taxation, November 2017, p. 607

Arbitration reservations are subject to other CTA party’s acceptance (p. 611)

Article 28(2)(a) permits the parties to the MLI to formulate one...

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Manal Corwin, Jesse Eggert, "Understanding the Operation, Impact, and Practical Implications of the MLI", Tax Management International Journal, Vol. 46, No. 8, 11 August 2017, p. 407

Vagueness of some free-form reservations to MLI Art. 28 (p. 416)

While the provision applies by default to existing MAP inventories (subject to...

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