Income Tax Act — I-3.3 133
lowing amounts in respect of the period commencing January 1, 1972 and ending immediately after the corporation’s last taxation year ending before the particular time: (a) the corporation’s capital gains for taxation years ending in the period from dispositions in the period of Canadian property or shares of another non-resident-owned investment corporation, and (b) amounts received by the corporation in the period as, on account or in lieu of payment of, or in satisfaction of capital gains dividends from other non-resident-owned investment corporations, and B is the total of the following amounts in respect of the period referred to in the description of A: (a) the corporation’s capital losses for taxation years ending in the period from dispositions in the period of Canadian property or shares of another non-resident-owned investment corporation, (b) all capital gains dividends that became payable by the corporation before the particular time, and (c) the amount determined by the formula 0.25 × (M - N) where M is the total of the corporation’s capital gains for taxation years ending in the period from dispositions in the period of taxable Canadian property, and N is the total of the corporation’s capital losses for the taxation years ending in the period from dispositions in the period of property of the kinds referred to in the description of M; ( compte de dividendes sur les gains en capital ) increase in capital in respect of a corporation means a transaction (other than a transaction carried out pursuant to an agreement in writing made before February 28, 2000, referred to in this definition as a “specified transaction”) in the course of which the corporation issues additional shares of its capital stock or incurs indebtedness, if the transaction has the effect of increasing the total of (a) the corporation’s liabilities, and (b) the fair market value of all the shares of its capital stock to an amount that is substantially greater than that total would have been on February 27, 2000 if all specified transactions had been carried out immediately before that day; ( augmentation de capital ) non-resident-owned investment corporation means a corporation incorporated in Canada that, throughout the whole of the period commencing on the later of June 18, 1971 and the day on which it was incorporated and ending on the last day of the taxation year in respect of which the expression is being applied, complied with the following conditions: (a) all of its issued shares and all of its bonds, debentures and other funded indebtedness were (i) beneficially owned by non-resident persons (other than any foreign affiliate of a taxpayer resident in Canada), (ii) owned by trustees for the benefit of non-resident persons or their unborn issue, or (iii) owned by a non-resident-owned investment corporation, all of the issued shares of which and all of the bonds, debentures and other funded indebtedness of which were beneficially owned by non-resident persons or owned by trustees for the benefit of non-resident persons or their unborn issue, or by two or more such corporations, (b) its income for each taxation year ending in the period was derived from (i) ownership of, or trading or dealing in, bonds, shares, debentures, mortgages, hypothecary claims, bills, notes or other similar property or any interest, or for civil law any right, therein, (ii) lending money with or without security, (iii) rents, hire of chattels, charterparty fees or remunerations, annuities, royalties, interest or dividends, (iv) estates or trusts, or (v) disposition of capital property, (c) not more than 10% of its gross revenue for each taxation year ending in the period was derived from rents, hire of chattels, charterparty fees or charterparty remunerations, (d) its principal business in each taxation year ending in the period was not (i) the making of loans, or (ii) trading or dealing in bonds, shares, debentures, mortgages, hypothecary claims, bills, notes or othe