Session1
Hot Topics & Fundamentals
Eric C Xiao, Partner, Ernst & Young LLP
9:00- 10:00
Panel: Taxation of Corporate Reorganizations - Current Issues and Future Trends
Mark Brender, Partner, Osler, Hoskin & Harcourt LLP
Firoz Ahmed, Partner, Osler, Hoskin & Harcourt LLP
Eric C Xiao, Partner, Ernst & Young LLP
Edward A. Heakes, Partner, Dale & Lessmann LLP
This opening panel, comprised of leading Canadian tax experts, will address the latest issues and trends related to corporate reorganization, examining the most recent developments and technical amendments affecting the taxation of mergers, takeovers, amalgamations and other restructurings.
Recent reorganization issues and transactions: impact on tax planning techniques and strategies
The latest financing developments and tax consequences
Recent judicial decisions affecting corporate reorganizations
Developments pertaining to GAAR and specific anti-avoidance rules
Most recent technical amendments
10:00-10:45
Planning with Partnerships
Mitchell J. Sherman, Partner, Goodmans LLP
This presentation addresses the issues affecting the taxation and reorganization of partnerships.
General overview of partnerships, including the at-risk rules
Reorganization of partnerships including mergers and loss consolidation strategies
Reorganization to corporate form
Bump of a partnership interest and related limitations
General limitations of the use of partnerships, including deferral and sale strategies
Creative tax planning ideas and recent case law involving partnerships
Recent amendments affecting partnerships
10:45-11:00 NETWORKING BREAK
11:00-11:45
The 88(1)(d) Bump: A User’s Guide
Steve Suarez, Partner, Borden Ladner Gervais LLP
This presentation will provide the latest developments and tax planning strategies for the cost basis step-up or (bump) available under 88(1)(d), with particular emphasis on:
When and how to use it the 88(1)(d) “bump"
Traps to watch for
Latest developments from Finance and Revenue: recent technical changes and selected CRA pronouncements
Use of the bump to reduce gains on the sale or transfer of eligible property
Bump on foreign affiliate shares
Bump denial and ineligible property rules
11:45-12:30
Paid-Up Capital and Internal Reorganizations
Stephen S. Ruby, Partner, Davies Ward Phillips & Vineberg LLP
Paid-up capital plays a significant role in determining the tax consequences of transactions completed between corporations and their shareholders. This presentation will examine the latest issues and strategies involving paid-up capital in the context of internal reorganizations.
Determining paid-up capital
Returning paid-up capital to shareholders
Paid-up capital and acquisition strategies
Increasing, reducing and shifting paid-up capital
The role paid up capital plays in share-for-share exchanges, trust unit-for-share exchanges and corporate reorganizations using sections 51, 86, 87, 88
Recent cases, transactions and strategies involving paid-up capital
Session2
Cross-Border Strategies
Kathleen Hanly, Partner, Fasken Martineau DuMoulin LLP
1:30- 2:30
Canada - U.S. Current Cross-Border Tax Update
Paul D. Carman, Partner, Chapman and Cutler LLP
Vitaly Timokhov, Partner, TaxChambers LLP
This presentation will examine developments in Canadian and U.S. cross-border tax rules as well as new proposals under review that will affect both inbound and outbound planning, and the implications for tax-efficient structuring and financing of an M&A and other reorganizations.
Recent legislative and administrative changes and the impact on cross-border investment between Canada and the U.S.
Post-BEPS Group Structures
FATCA's application to M&A
U.S. limited liability companies and other fiscally transparent entities
Article IV(7) of the Canada-U.S. Treaty and its application to payments made by Canadian unlimited liability companies
Canadian GAAR: cross-border debt financing and restructuring
OECD Hybrid Mismatches
Article XXIXA (Limitation of Benefits) of the Canada-U.S. Treaty
The OECD Limitation on Benefits and Principal Purpose Tests
Canadians investing in the U.S.: U.S. LLCs or partnerships?
REPOs and the Foreign Tax Credit Generator Rules
2:30- 3:15
Structuring and Reorganizing Foreign Affiliates
Jonathan Garbutt, Prinicpal, Garbutt Tax Law
The Department of Finance recently released the final package of draft legislation related to the taxation of foreign affiliates. The package included revisions to the foreign affiliate reorganization & distribution rules originally proposed in a February 2004 release. It also included new proposals that have potentially significant tax planning implications. This discussion addresses latest developments affecting the reorganization and taxation of foreign affiliates.
Foreign affiliate rules and the potential implications on your business
Use of holding companies and financing affiliates
Opportunities arising from FAPI rules and the implications of structuring foreign affiliates
Foreign affiliate surplus rules and anti-deferral tax rules
Impact of new rules on foreign affiliate reorganizations
Foreign affiliate M&As under new proposed law
Canadian shareholder reorganization rules
Anti-avoidance rules with respect to foreign affiliate reorganizations
Hybrid, surplus and upstream loan rule
3:00-3:30 NETWORKING BREAK
3:30-4:15
Exchangeable Share Transactions
Jonathan W. Willson, Partner, Stikeman Elliott LLP
Exchangeable shares of a Canadian corporation have primarily been used to achieve tax deferrals in situations where there is an acquisition of a Canadian target corporation by a non-resident corporation and where the non-resident corporation wishes to pay for the acquisition by the issuance of its own shares. This session sets out the primary means of structuring a Canadian exchangeable share transaction and reviews the tax considerations and features of exchangeable shares.
Principal attributes of exchangeable shares
Typical exchangeable share structure
Basic mechanics of an exchangeable share transaction and Canadian tax implications
Tax issues that must be dealt with in an exchangeable share structure
Alternative uses for exchangeable shares
Future of exchangeable shares
4:15-5:00
Debt Structuring
Kathleen Hanly, Partner, Fasken Martineau DuMoulin LLP
Kevin Yip, Partner, Fasken Martineau DuMoulin LLP
This presentation will explore issues encountered in corporate reorganizations and debt restructuring including the debt forgiveness rules and related issues.
Debt forgiveness rules
Equity for debt restructuring
Debt for debt restructuring
Debt parking rules
Acquisition of control planning
Non-resident creditors
Session3
Acquisition Strategies
Mark Brender, Partner, Osler, Hoskin & Harcourt LLP
9:00- 10:30
Panel: The Latest Tax-Avoidance & GAAR Developments
Mark Brender, Partner, Osler, Hoskin & Harcourt LLP
Ian S. MacGregor, Partner, Osler, Hoskin & Harcourt LLP
David Nathanson, Q.C., Partner, DLA Piper (Canada) LLP
This panel of leading tax experts will discuss the most current issues in tax avoidance and developments in the general anti avoidance rules, including:
Examination of the elements of the general anti-avoidance rule: have we achieved "consistency, predictability and fairness"?
Key current GAAR cases: what is currently working its way through the GAAR pipeline?
CRA’s position on abusive transactions
Review of recent non-GAAR tax avoidance cases
CRA's "Aggressive Tax Planning Division": what are they pursuing?
11:00-11:45
Takeovers and Tax Issues
David Fox, Partner, Cummings Cooper Schusheim Berliner LLP
This presentation will look at new developments affecting takeovers, with particular focus on the tax impact on acquisition of control issues.
Overview of acquisition of control issues: corporate acquisition of control rules and related planning techniques
Tax due diligence process in the purchase & sale of a business
Tax planning for the seller: pre-selling planning and sale planning
Tax planning for the purchaser: pre-acquisition planning, acquisition planning and post-merger integration
Deferral of capital gains by the vendor
Tax cost of assets and structure for the bump
Deductibility of interest and financial expenses of reorganization: debt forgiveness issues
10:30-11:00 NETWORKING BREAK
11:45-12:30
Tax-Effective Financing of Acquisitions
Richard Lewin, Partner, Wildeboer Dellelce LLP
This presentation will discuss share and asset acquisition tax attributes and the options available to minimize taxes, including:
Tax consequences of financing with equity for both common and preferred shares
Tax consequences of financing with debt: participating debt instruments, paid-in-kind interest notes and compound debt instruments
Deductibility of financing and transaction costs: interest deductibility rules
Financing with a balance of price
Thin capitalization and financing
Capital tax issues
Financing issues relating to income trusts
12:30-1:30 Lunch
Session4
Topical Issues in Corporate Reorganization
Mark Brender, Partner, Osler, Hoskin & Harcourt LLP
1:30-2:30
Subsection 55(2) and Divisive Reorganizations
Mark Brender, Partner, Osler, Hoskin & Harcourt LLP
Brian Carr, Partner, Moskowitz & Meredith LLP/KPMG LLP
This extended session will examine the application of subsection 55(2), the related party exception in paragraph 55(3)(a) and the "butterfly" exception in paragraph 55(3)(b), including:
Subsection 55(2): history and proposed changes
Recent judicial and administrative developments affecting the computation of safe income
CRA’s administrative positions and related jurisprudence
Divisive reorganizations: 55(3)(a) –old and new
55(3)(b), type of property, spins and splits
Safe income crystallization: safe income determination time; planning techniques to maximize and access safe income
Advanced divisive reorganizations & 55(3)(a) Related Party Divisive Reorganizations: private & public contexts; trips & traps
Advanced divisive reorganizations & 55(3)(b) Spin-Offs/Split-Ups
3:00-3:45
Use of Tax Losses
James A. Hutchinson, Partner, Miller Thomson LLP
Accrued and realized tax losses constitute an important attribute of a corporation that, if properly harnessed, can be extremely valuable. This presentation examines potential loss utilization alternatives in corporate tax planning.
Techniques to use and preserve losses within an affiliated corporate group
Loss utilization between or among arm’s length parties
Triggering accrued losses: the impact of the affiliated persons rules on tax-loss use within a corporate group
Tax treatment of losses upon acquisition of control
The role of the CRA and the impact of its most recent rulings in loss utilization
The impact of recent case law
3:00-3:30 NETWORKING BREAK
3:45-4:30
Taxable Preferred Shares
Robert Raizenne, Partner, Osler, Hoskin & Harcourt LLP
The income tax treatment of preferred shares is complicated, so careful planning is required to avoid adverse consequences. This presentation reviews the taxable preferred share rules and also the term preferred and guaranteed share rules, and describes their application to corporate reorganizations and other corporate transactions.
Share purchases and sales
Divisive reorganizations
Capital restructuring
Issuer bids
Preferred share financing
Optional workshops:
9:00-Noon
Update on Corporate Reorganizations: Review of Recent Transactions
Mark Brender, Partner, Osler, Hoskin & Harcourt LLP
Richard Lewin, Partner, Wildeboer Dellelce LLP
This intensive workshop will incorporate many of the concepts analyzed in the conference sessions by providing an in-depth review of several recent transactions involving corporate reorganizations. Both public and private companies will be highlighted in this interactive session. Topics will include
In-depth review of recent CRA rulings
Review of reorganization techniques and issues
Paid-up capital and internal reorganizations
Considerations for public and private exchangeable share transactions
Issues affecting the reorganization of mutual fund trusts
Practical strategies and tax planning opportunities
" Mark Brender's practice focuses on domestic and international income tax issues, including international tax planning, cross-border and domestic mergers and acquisitions, corporate reorganizations, spin-offs, financings and tax dispute resolution. Mark is a dedicated editor, writer, lecturer and speaker on tax matters, covering diverse topics such as the tax aspects of mergers and acquisitions, corporate reorganizations and estate planning.
Richard Lewin practices exclusively in the area of taxation with primary emphasis on the taxation of corporate reorganizations, M&As, and corporate finance, both for public and private corporations. In addition, Richard is a regular advisor to individuals and private enterprises with respect to estate planning matters and to the intergenerational transfer of an operating business. He has represented domestic and international corporations, and he has extensive experience representing mining and oil and gas corporations, private equity and venture capital groups. Richard is also a certified public accountant and is able to use his accounting knowledge to provide insight into financial matters of clients. "
1:30-4:00
Merging Companies: A Practical Checklist For Effective Amalgamations And Wind-Ups
Fred Purkey, Partner, Davies, Ward Phillips & Vineberg LLP
Mergers are used as a tool for corporate consolidations, reorganizations and acquisitions. The essential tax objectives of most mergers are to ensure that there are no adverse tax consequences to the corporations being merged or their shareholders and to ensure continuity, efficiency and flexibility. What are the practical tax considerations when determining whether to undertake a merger by wind-up as opposed to amalgamation? This practical hands-on workshop will explore the key issues regarding wind-ups and amalgamations from a Canadian income tax perspective.
Comparative overview of the tax and legal effects of a wind-up and amalgamation
Tax considerations when deciding between an amalgamation or a wind-up
Tax planning opportunities and traps of amalgamations and wind-ups
Tax-free and taxable dispositions of assets or stock
" Fred Purkey is a Partner in the Montreal office of Davies Ward Phillips & Vineberg LLP practising in the area of taxation. Fred advises clients, both individual and corporate, on the income tax aspects of corporate reorganizations, personal and business trusts, owner-managed businesses, and cross-border and international transactions, including mergers and acquisitions, financing, employee compensation arrangements and personal tax planning. Fred has been published in Tax Topics, Quebec Tax Reporter, Preparing Your Income Tax Returns, and Preparing Your Corporate Returns (all published by CCH). Fred has also been published in Corporate Structures and Groups and Resource Sector Taxation (both published by Federated Press). He was a Lecturer in "Taxation" at the McGill University law school and has also taught "Taxation of Real Estate" at McGill.
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