Income Tax Act — I-3.3 87
he subject property becomes property of a corporation that is a new foreign corporation for the purposes of subsection (8.1); (c) no shareholder (except any predecessor foreign corporation) that owned shares of the capital stock of a predecessor foreign corporation immediately before the foreign merger received consideration for the disposition of those shares on the foreign merger, other than shares of the capital stock of the new foreign corporation; (d) if the subject property is a share of the capital stock of a corporation or an interest in a trust, the corporation or trust is not, at any time in the 24-month period beginning at that time, as part of a transaction or event, or series of transactions or events including the foreign merger, subject to a loss restriction event; and (e) the new foreign corporation and the disposing predecessor foreign corporation jointly elect in writing under this paragraph in respect of the foreign merger and file the election with the Minister on or before the filing-due date of the disposing predecessor foreign corporation (or the date that would be its filing-due date, if subsection (8.5) did not apply in respect of the disposition of the subject property) for the taxation year that includes that time. Foreign merger — taxable Canadian property rollover (8.5) If this subsection applies at any time, (a) if the subject property is an interest in a partnership, (i) the disposing predecessor foreign corporation is deemed not to dispose of the subject property (other than for the purposes of subsection (8.4)), and (ii) the new foreign corporation is deemed (A) to have acquired the subject property at a cost equal to the cost of the subject property to the disposing predecessor foreign corporation, and (B) to be the same corporation as, and a continuation of, the disposing predecessor foreign corporation in respect of the subject property; and (b) if the subject property is a share of the capital stock of a corporation or an interest in a trust, (i) the subject property is deemed to have been disposed of at that time by the disposing predecessor foreign corporation to the new foreign corporation (that is referred to in subparagraph (8.4)(b)(ii)) for proceeds of disposition equal to the adjusted cost base of the subject property to the disposing predecessor foreign corporation immediately before that time, and (ii) the cost of the subject property to the new foreign corporation is deemed to be the amount that is deemed by subparagraph (i) to be the proceeds of disposition of the subject property. Rules applicable in respect of certain mergers (9) Where there has been a merger of two or more taxable Canadian corporations to form a new corporation that was controlled, immediately after the merger, by a taxable Canadian corporation (in this subsection referred to as the “parent”) and, on the merger, shares of the capital stock of the parent (in this subsection referred to as “parent shares”) were issued by the parent to persons who were, immediately before the merger, shareholders of a predecessor corporation, the following rules apply: (a) for the purposes of paragraph 87(1)(c), subsection 87(4) and the Income Tax Application Rules , any parent shares received by a shareholder of a predecessor corporation shall be deemed to be shares of the capital stock of the new corporation received by the shareholder by virtue of the merger; (a.1) for the purposes of subsections 87(4.1) and 87(4.2), a parent share issued to a shareholder in consideration for the disposition of a share of a class of the capital stock of a predecessor corporation shall be deemed to be a share of a class of the capital stock of the new corporation that was issued in consideration for the disposition of a share of a class of the capital stock of a predecessor corporation by that shareholder; (a.2) for the purposes of subsection 87(4.3), a right listed on a designated stock exchange to acquire a share of a class of the capital sto