Income Tax Act — I-3.3 128.1
 person or, if no single non-resident person controlled the CRIC, a group of non-resident persons not dealing with each other at arm’s length (in this section, that one non-resident person, or each member of the group of non-resident persons, as the case may be, is referred to as a “parent”, and the group of non-resident persons, if any, is referred to as the “group of parents”) and the taxpayer owned, immediately before the particular time, one or more shares of one or more non-resident corporations (each of which is in this paragraph referred to as a “subject affiliate”) that, immediately after the particular time, were — or that became, as part of a transaction or event or series of transactions or events that includes the taxpayer having become resident in Canada — foreign affiliates of the taxpayer, then (i) in computing the paid-up capital, at any time after the time that is immediately after the particular time, of any particular class of shares of the capital stock of the taxpayer there is to be deducted the amount determined by the formula A × B/C where A is the lesser of (A) the paid-up capital in respect of all of the shares of the capital stock of the taxpayer at the time that is immediately after the particular time, and (B) the total of all amounts each of which is the fair market value at the particular time of (I) a share of the capital stock of a subject affiliate owned by the taxpayer at the particular time, or (II) an amount owing by the subject affiliate to the taxpayer at the particular time, B is the paid-up capital in respect of the particular class of shares of the capital stock of the taxpayer at the time that is immediately after the particular time, and C is the paid-up capital in respect of all the shares of the capital stock of the taxpayer at the time that is immediately after the particular time, and (ii) for the purposes of Part XIII, the taxpayer is deemed, immediately after the particular time, to have paid to each parent, and each parent is deemed, immediately after the particular time, to have received from the taxpayer, a dividend in an amount determined by the formula (A – B) × C/D where A is the amount determined under clause (B) of the description of A in subparagraph (i), B is the amount determined under clause (A) of the description of A in subparagraph (i), C is the fair market value, immediately after the particular time, of the shares of the capital stock of the taxpayer that are held, directly or indirectly, by the parent, and D is the total of all amounts each of which is the fair market value, immediately after the particular time, of the shares of the capital stock of the taxpayer that are held, directly or indirectly, by a parent. Foreign affiliate (d) where the taxpayer was, immediately before the particular time, a foreign affiliate of another taxpayer that is resident in Canada, (i) the affiliate is deemed to have been a controlled foreign affiliate of the other taxpayer immediately before the particular time, and (ii) the prescribed amount is to be included in the foreign accrual property income of the affiliate for its taxation year that ends immediately before the particular time. Trusts subject to subsection 94(3) (1.1) Paragraph (1)(b) does not apply, at a time in a trust’s particular taxation year, to the trust if the trust is resident in Canada for the particular taxation year for the purpose of computing its income. Trusts and partnerships look-through rule (1.2) For the purposes of this subsection and paragraph (1)(c.1), if at any time shares of the capital stock of a corporation resident in Canada are owned by a trust or a partnership (each referred to in this subsection as a “conduit”), each person or partnership with an interest as a beneficiary under the conduit or that is a member of the conduit (each referred to in this subsection as a “holder”), as the case may be, is deemed to own the shares of each class of the capital stock of the corporation that are owne