2024 Ruling 2023-0989031R3 - QET Internal Reorganization

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Principal Issues: (1) Will the Proposed Trust Amendments, in and by themselves, result in a disposition by the Trust of its property or in a resettlement of the Trust for the purposes of the Act? (2) Is there an income inclusion as a result of a disposition of a QET interest where the only consideration for the disposition is an assumption of reclamation obligations?

Position: (1) No, (2) No.

Reasons: The law.

XXXXXXXXXX		 					2023-098903

XXXXXXXXXX, 2024

Re: Supplemental Advance Income Tax Ruling Request to Ref: XXXXXXXXXX and Ref: 2018-078708 regarding XXXXXXXXXX

This is in reply to the request made by XXXXXXXXXX (referred to herein as the “Corporation”) for a supplemental advance income tax ruling (a “Supplemental Ruling”) under the Income Tax Act (Canada) R.S.C. 1985, c. 1 (5th Supp.), as amended to the date of this letter (the “Act”) in connection with the proposed amendment and restatement of the XXXXXXXXXX Trust (the “Trust”) and the proposed transactions described herein. The request seeks amendments to the advance income tax ruling letters with reference No.: XXXXXXXXXX and No.: XXXXXXXXXX (collectively referred hereto as the “Prior Rulings Letters”).

XXXXXXXXXX, in its capacity as trustee to the Trust (Account No. XXXXXXXXXX), has requested to be a party to this Supplemental Ruling.

You confirm that, to the best of your knowledge and to the knowledge of the Corporation and XXXXXXXXXX Partnership (the “Partnership”), none of the proposed transactions or issues involved in this Supplemental Ruling are the same as or substantially similar to transactions or issues that are:

(a) in a previously filed return of the Corporation, the Partnership, or a related person, and:

(i) being considered by the Canada Revenue Agency (the “CRA”) in connection with such return;

(ii) under objection by the Corporation, the Partnership, or a related person; or

(iii) the subject of a current or completed court process involving the Corporation, the Partnership or a related person; or

(b) the subject of a ruling previously issued or considered by the Income Tax Rulings Directorate (“ITRD”), other than the Prior Rulings Letters.

II. DEFINITIONS

Unless otherwise expressly stated herein: (i) all statutory references are to the provisions of the Act; (ii) all terms used in this Supplemental Ruling that are defined in the Act (or the Income Tax Regulations) have the meaning given in such definitions; (iii) all capitalized terms defined in the Prior Rulings Letters have the meanings set out in the Prior Rulings Letters, except to the extent modified herein; (iv) all references to monetary amounts are in Canadian dollars, unless otherwise indicated; and (v) the singular should be read as plural and vice versa where the circumstances so require.

The following terms are defined below for purposes of this Supplemental Ruling:

“Abandon” or “Abandonment” has the meaning set out in the definition of “abandon” in the XXXXXXXXXX (Canada), as amended from time to time;

“Agreement” means the trust agreement entered into by the Corporation and XXXXXXXXXX Trust Corporation on XXXXXXXXXX, approved by the NEB on XXXXXXXXXX and as amended and restated from time to time in accordance with its terms;

“Amended and Restated Trust Agreement” refers to the amended and restated Agreement incorporating the Proposed Trust Amendments, which is subject to the approval by the Tribunal and which will have an effective date of XXXXXXXXXX;

“Beneficiary” or “Beneficiaries” means a Person, including the Company, acting in its own capacity, or acting on behalf of a partnership, that has Reclamation Obligations in respect of the Site;

“CCA” or “capital cost allowance” means the deduction allowed by paragraph 20(1)(a) and Regulation 1100 of Schedule II of the Income Tax Regulations;

“CER Act” means the Canadian Energy Regulator Act (Canada), as amended from time to time;

“Certificates” means the regulatory authorizations issued from time to time by the Tribunal in respect of the ownership and operation of the XXXXXXXXXX;

“Company” means the person holding the regulatory authorization(s) to operate the XXXXXXXXXX, whether on its own behalf or on behalf of one or more Persons;

“Corporation” means XXXXXXXXXX. with an address of its head office is XXXXXXXXXX;

“Deactivate” and “Deactivation” has the meaning set out in the definition of “deactivate” in the XXXXXXXXXX (Canada), as amended from time to time;

“Decommission” and “Decommissioning” has the meaning set out in the definition of “decommission” in the XXXXXXXXXX (Canada), as amended from time to time;

“Effective Time” means the time at which the assignment, transfer, and conveyance of the XXXXXXXXXX Assets and QET Interest occurs pursuant to the terms set out in the Transfer and Assignment Agreement;

“Fund” means all assets which are now or which at any time during the continuance of the Trust may be contributed, assigned, transferred or appointed to the Trustee to be held upon the trusts formed under the Agreement, together with all interest or return from investing such assets, and all other assets which may at any time be substituted therefor, but excluding all amounts which have been paid or disbursed therefrom (whether out of capital or income) pursuant to the Agreement;

“GP Co.” means XXXXXXXXXX. incorporated on XXXXXXXXXX with an address of its head office is XXXXXXXXXX;

“Orphan Pipeline Fund” means a not-for-profit corporation that will be established pursuant to a statute of the Parliament of Canada and will maintain funds for the purpose of funding the reclamation of XXXXXXXXXX in Canada, consistent with the Tribunal’s Reasons for Decision XXXXXXXXXX;

“Paragraph” means a number paragraph in this Supplemental Ruling;

“Parent Co.” means XXXXXXXXXX;

“Partnership” means the XXXXXXXXXX Partnership created on XXXXXXXXXX; the Partnership will be served by the XXXXXXXXXX;

“Partnership Agreement” means the Limited Partnership Agreement dated XXXXXXXXXX between the Corporation, as the initial limited partner, and GP Co., as a general partner, as amended and restated from time to time;

“Person” includes a partnership;

“XXXXXXXXXX” means the XXXXXXXXXX as described in Schedule “A” to the Agreement, as amended from time to time as follows:

The XXXXXXXXXX (the “XXXXXXXXXX”) is an integrated XXXXXXXXXX.

XXXXXXXXXX;

“XXXXXXXXXX Assets” means all of Corporation’s right, title and interest in, to and under, or relating to, the assets, property and undertaking, owned, or used or held by Corporation for use in, or relating to, the business of owning, operating and maintaining the XXXXXXXXXX and any and all activities directly or indirectly relating thereto or necessary, convenient or incidental thereto, but not including any Excluded Assets (as this term is defined in the Transfer and Assignment Agreement, which definition expressly excludes the QET Interest);

“Proposed Trust Amendments” means the proposed modifications as set out in the Amended and Restated Trust Agreement;

“Proposed Transactions” means the steps described and set out in Section IV below;

“Proposed Partnership Transactions” has the meaning set out in Paragraph 16;

“QET Interest” means the entire interest in the Trust;

“Qualifying Environmental Trust” or “QET” has the meaning assigned to this term in subsection 211.6(1);

“Qualified Investment” means all or any of those investments that from time to time are qualified investments for a QET, and for greater certainty, such qualified investments on the date hereof include only those types of property described in paragraphs (a), (b), (c) (c.l), (d) and (f) of the definition of “qualified investment” in section 204 that are not encompassed within the definition of “prohibited investment” in subsection 211.6(1);

“Reclamation Obligations” means:

(i) the duty to carry out the physical Abandonment, Decommissioning or Deactivation of the XXXXXXXXXX, including costs incurred to satisfy any conditions imposed by the Tribunal, in any order or direction approving the Decommissioning or Deactivation of the XXXXXXXXXX or for granting leave to Abandon the XXXXXXXXXX;

(ii) the duty to develop an Abandonment plan, and to prepare an application for leave to Abandon or for approval of the Deactivation or Decommissioning of the XXXXXXXXXX; and

(iii) the duty to carry out post-abandonment monitoring and remediation of the Site, where post-abandonment refers to the period of time after a Company has satisfied the conditions of an order or direction issued by the Tribunal granting leave to Abandon,

and all costs incurred and consequent thereon;

“Site” means any location or locations in Canada used for the operation of the XXXXXXXXXX;

“Statement of Investment Policies and Procedures” or “SIPP” means a written statement of investment policies and procedures approved by the Company in respect of the fund’s portfolio of investments which sets out broad policies and procedures for the Qualified Investments of the fund and as defined in the Agreement;

“Stub Year Period” has the meaning set out in Paragraph 38;

“taxable Canadian corporation” has the meaning assigned in subsection 89(1);

“Transfer and Assignment Agreement” means an agreement proposed to be entered into by the Corporation and the Partnership, acting through its general partner GP Co. to effect the following transactions: (i) to transfer the XXXXXXXXXX Assets to the Partnership and (ii) to assign the QET Interest to GP Co. who will hold the QET Interest on behalf of the Partnership;

“Tribunal” means the National Energy Board, a tribunal established under the National Energy Board Act (Canada), the Canadian Energy Regulator, a tribunal established under the CER Act or any successor administrative body having authority to regulate the Company in respect of the operation and abandonment of the XXXXXXXXXX;

“Trust” means the discretionary irrevocable trust settled under the Agreement for the purpose of reclamation in favour of the one or several Beneficiaries that have Reclamation Obligations with regard to the Site, and also of the Orphan Pipeline Fund, and which is called the “XXXXXXXXXX Trust;” and

“Trustee” means XXXXXXXXXX or any successor Trustee pursuant to the Agreement. The Trustee: (i) is a trust company that is licensed under the Trust and Loan Companies Act (Canada) (S.C. 1991, c.45), (ii) is a corporation resident in Canada for purposes of the Act and (iii) is authorized under the laws of Canada or a province to carry on in Canada the business of offering to the public its services as a trustee.

Our understanding of the facts, proposed transactions and purpose of the proposed transactions is as follows:

III. FACTS

The Corporation

1. Parent Co. is the sole shareholder of the Corporation and a taxable Canadian corporation.

2. The Corporation is a corporation validly existing under the Business Corporations Act XXXXXXXXXX and a taxable Canadian corporation.

3. The Corporation is the legal and beneficial owner of the XXXXXXXXXX and as such the Corporation is subject to regulation by the Tribunal, characterized as a Group 1 Company for regulatory purposes, and holds the regulatory authorization to operate the XXXXXXXXXX.

4. In XXXXXXXXXX, the Tribunal issued the XXXXXXXXXX which required certain regulated XXXXXXXXXX to have a set-aside mechanism in place by XXXXXXXXXX and to begin accumulating funds to pay for XXXXXXXXXX reclamation. In its decision, the Tribunal specifically supported the use of a QET as a mechanism to set aside monies to fund future abandonment costs.

5. As directed by the Tribunal in the Order XXXXXXXXXX, the Corporation established the Trust.

6. On XXXXXXXXXX, the Tribunal issued Order XXXXXXXXXX authorizing the transfer of XXXXXXXXXX Assets and the Tribunal approved the Amended and Restated Trust Agreement.

7. The Corporation currently holds the QET Interest.

8. The Corporation is not involved in buying or selling or trading interests in QET’s and does not hold the QET Interest as an adventure or concern in the nature of trade.

The Trust

9. On XXXXXXXXXX, in satisfaction of the requirements imposed by the Tribunal, the Trust was established for the purpose of setting aside funds to pay for the Reclamation Obligations in respect of the Site in Canada used for the operation of the XXXXXXXXXX.

10. The Trust is maintained for the sole purpose of funding the Reclamation Obligations in respect of the Site in Canada used for the operation of the XXXXXXXXXX in satisfaction of the requirements imposed by the Tribunal.

11. Pursuant to section XXXXXXXXXX of the Agreement, it is the express intention of the Corporation and the Trustee that the Trust established and governed under the Agreement constitute a Qualifying Environmental Trust, and the Company and the Trustee shall not take any actions which would jeopardize the status of the Trust as a Qualifying Environmental Trust, and shall cause any party, succeeding to the interests thereof to covenant to do the same.

12. On XXXXXXXXXX, the Trust was amended and restated in accordance with its terms, to reflect certain amendments as prescribed by the Tribunal.

13. The Prior Rulings Letters obtained by the Corporation in respect of the Trust set out five rulings which are referred to and itemized therein as Rulings “A”, “B”, “C”, “D” and “E.”

The Partnership

14. On XXXXXXXXXX, in contemplation of the Proposed Partnership Transactions described below:

(a) The Corporation formed GP Co. under the laws of the Province of Alberta; and

(b) The Corporation and GP Co. formed the Partnership as a limited partnership under the laws of the XXXXXXXXXX with the Corporation as the initial limited partner holding a XXXXXXXXXX% interest and GP Co., as the general partner holding the remaining XXXXXXXXXX% interest.

15. On XXXXXXXXXX, the Corporation filed an application to the Tribunal for approval to own and operate the XXXXXXXXXX through the Partnership on a go-forward basis.

Proposed Partnership Reorganization

16. As more fully described in Section IV of this Supplemental Ruling, following the approval from the Tribunal, it is proposed that:

(a) The Corporation will

(i) transfer the XXXXXXXXXX Assets to the Partnership on a tax-deferred basis in exchange for the assumption of certain liabilities and an additional interest in the Partnership;

(ii) transfer the Certificates to GP Co. on behalf of the Partnership on a tax-deferred basis in exchange for additional shares of GP Co.; and

(iii) assign the QET Interest to GP Co., on behalf of the Partnership, in sole consideration for the assumption of the Reclamation Obligations; and

(b) the Tribunal will amend the Certificates to reflect GP Co. as the holder of the regulatory authorizations to own and operate the XXXXXXXXXX on behalf of the Partnership,

(collectively referred to herein as the “Proposed Partnership Transactions”).

Proposed Trust Amendments

17. The Agreement narrowly defines “Beneficiary” with reference to only such Person(s) that holds the Reclamation Obligations at the relevant time:

“Beneficiary” or “Beneficiaries” means a Person, including the Company, acting in its own capacity or acting on behalf of a partnership, that has Reclamation Obligations in respect of the Site.

18. Similarly, the Agreement defines “Company” to mean the specific person that holds the regulatory authorization to operate the XXXXXXXXXX at the relevant time:

“Company” means the person holding the regulatory authorization(s) to operate the XXXXXXXXXX at the relevant time, whether on its own behalf or on behalf of one or more Persons, and for greater certainty, the initial Company shall be the Corporation.

19. It is proposed that the Agreement will be amended and restated to reflect the change of Company and Beneficiary (each as defined in the Agreement) as a consequence of the amended Certificates, and the transfer the XXXXXXXXXX Assets, and the assignment of the Reclamation Obligations and the QET Interest from the Corporation to the Partnership and GP Co., acting on behalf of the Partnership.

20. Pursuant to section XXXXXXXXXX of the Agreement, the Company and Beneficiaries are divested of any power whatsoever to revoke the Trust or modify its terms or to amend the Agreement in any respect, except in accordance with the terms of the Agreement.

21. Article XXXXXXXXXX expressly provides the Trustee with the power to amend the terms of the Trust subject to the approval of the Tribunal and with the consent of the Company and states:

The Trustee may, by agreement with the Company, amend the terms of the Trust, including the terms and schedules of this Agreement. No amendment to the terms of the Trust or the terms of this Agreement will be binding or effective unless the Tribunal approves the amendment.

22. As part of the Proposed Transactions, the Proposed Trust Amendments will be carried out pursuant to Article XXXXXXXXXX of the Agreement and in accordance with the terms of the Trust to reflect the appropriate “Beneficiary” and “Company” resulting from the Proposed Transactions.

23. The Proposed Trust Amendments also incorporate certain other clarifying amendments, including those required to reflect the formation of the Canadian Energy Regulator pursuant to the CER Act as a successor administrative body to the former National Energy Board formerly established under the National Energy Board Act (Canada).

24. The Proposed Trust Amendments will not:

(a) alter or change the requirements prescribed in the Agreement for a person to be the “Company” or a “Beneficiary” thereunder;

(b) contemplate any transfer of the Trust property (namely, the Funds to satisfy the Reclamation Obligations of the XXXXXXXXXX) to a new Trustee, or to any other Person;

(c) change the underlying stated purpose of the Agreement to fund Reclamation Obligations in respect of the XXXXXXXXXX;

(d) effect a fundamental change to the key terms or the “substratum” of the Trust; or

(e) impact existing investments held by the Trust pursuant to the SIPP.

25. As a matter of provincial law, the Proposed Trust Amendments do not:

(a) affect the validity of the Trust or the eligibility of the Trustee;

(b) require a variation of the Trust; or

(c) constitute a resettlement of the Trust or a disposition of the Trust property.

26. At all times, the Trust will operate in accordance with its terms and in accordance with the Agreement and the Amended and Restated Trust Agreement subsequent to the Effective Time upon completion of the Proposed Transactions.

Investments

27. The Proposed Trust Amendments will not impact the manner in which the Trust’s funds are invested. At all times, the Trust shall comply with the statements relating to Rulings “C” and “E” as set out in the Prior Rulings Letters.

28. At all times, the Trust will comply with section XXXXXXXXXX of the Agreement which states that the Trustee shall invest the Fund in, and maintain the Fund invested in, Qualified Investments in accordance with the SIPP received by the Trustee from time to time.

IV. PROPOSED TRANSACTIONS

29. Once the necessary approvals from the Tribunal are obtained, the Proposed Transactions will take place at the Effective Time, which shall be on or after XXXXXXXXXX.

30. At the Effective Time, in order to give effect to the Proposed Partnership Transactions, and pursuant to the terms of the Transfer and Assignment Agreement among the Corporation, GP Co and the Partnership, the Corporation will:

(a) transfer the XXXXXXXXXX Assets to the Partnership and, in consideration, the Partnership will assume and agree to pay, discharge, and be responsible for certain assumed liabilities (which will not include the Reclamation Obligations) and issue units of the Partnership to the Corporation;

(b) transfer the Certificates to GP Co. and, in consideration, GP Co. will issue shares to the Corporation;

(c) notify the Trustee and assign the QET Interest to GP Co. in its capacity as the general partner of and on behalf of the Partnership, and in sole consideration for the QET Interest, the Partnership will assume and agree to pay, discharge and be responsible for the Reclamation Obligations of the XXXXXXXXXX, as contemplated by paragraph 12(1)(z.2) of the Act; and

(d) the Trustee, by agreement with the Corporation, will adopt the Proposed Trust Amendments and amend and restate the Agreement in the form of the Amended and Restated Trust Agreement to reflect the Proposed Partnership Transactions and make other non-substantive administrative amendments to the SIPP and other documents related to the Trust as required by the Tribunal to reflect the Proposed Partnership Transactions.

31. The Corporation and GP Co., as the general partner of the Partnership, will jointly elect in prescribed form and within the time required by subsection 96(4) to have the rules in subsection 97(2) apply to the transfer of the XXXXXXXXXX Assets.

32. The Corporation and GP Co. will jointly elect in prescribed form and within the time required by subsection 85(6) to have the rules in subsection 85(1) apply to the transfer of the Certificates.

33. No amount will be separately received or earned by the Corporation in connection with the transfer of the QET Interest, for which the sole consideration will be the assumption of the Reclamation Obligations by the Partnership.

34. Immediately after the Proposed Partnership Transactions, GP Co. will be subject to the XXXXXXXXXX and to the XXXXXXXXXX. Further, GP Co. will hold the regulatory authorization to operate the XXXXXXXXXX and, following the Proposed Partnership Transactions, will make contributions to the Trust, as determined by the Tribunal, for the purpose of funding Reclamation Obligations on behalf of the Partnership in accordance with the Amended and Restated Trust Agreement.

35. Following the Proposed Partnership Transactions, Parent Co., as the sole shareholder of the Corporation, will commence the liquidation of the Corporation on a tax-deferred basis pursuant to subsection 88(1) of the Act and shall duly file all elections in connection therewith. Consequently, Parent Co. will become the limited partner of the Partnership, and the shareholder of GP Co.

36. Each of the Proposed Transactions, including each of the transfers described in Paragraph 30(a) to (c), will be legally effective.

V. ADDITIONAL INFORMATION

37. Any future transfer of the QET Interest could only be completed with the approval of the Tribunal and it could only occur in conjunction with a transfer of the XXXXXXXXXX Assets.

38. The Corporation has submitted a request to the CRA for approval of an additional “fiscal period” ending the day before the Proposed Transactions. The purpose of this request is to enable the Corporation to align its claim for CCA in connection with the XXXXXXXXXX Assets with the income earned from those assets for the stub period commencing XXXXXXXXXX and ending the day before the Proposed Transactions (the “Stub Year Period”). If the request is approved by the CRA, only the Corporation will claim CCA in connection with the XXXXXXXXXX Assets for the Stub Year Period; and for greater certainty, the Partnership will not claim CCA in connection with the XXXXXXXXXX Assets for the Stub Year Period.

VI. PURPOSE OF THE PROPOSED TRANSACTIONS

39. The purpose of the Proposed Partnership Transactions is to effect the transfer of the XXXXXXXXXX Assets to the Partnership to facilitate both (a) the ongoing consolidation of business income and (b) potential minority participation in the XXXXXXXXXX, including possible participation by Indigenous groups, while ensuring that the Trust at all times qualifies as a Qualifying Environmental Trust and complies with decisions, orders, and directions of the Tribunal.

VII. RULINGS

Provided that (i) the preceding statements constitute complete and accurate disclosure of all the relevant facts, proposed transactions, additional information and purpose of the proposed transactions, (ii) the Proposed Transactions are legally effective and completed in the manner set out in this Supplemental Ruling, and (iii) the Proposed Trust Amendments are approved by the Tribunal and adopted in the manner set out in the version of the Amended and Restated Trust Agreement approved by the Tribunal on XXXXXXXXXX, we rule as follows:

(note: changes to prior advance income tax rulings have additions underlined and deletions marked with strikethrough).

Ruling “A”

A. Provided that the Trust is operated in accordance with the terms of the Amended and Restated Trust Agreement, the Trust will constitute a “qualifying environmental trust” as defined in subsection 211.6(1) of the Tax Act.

Rulings “B” and “D”

B. Amounts contributed to the Trust by the Corporation GP Co., as a general partner of and on behalf of the Partnership, will be deductible in computing the income of the Corporation Partnership pursuant to paragraph 20(1)(ss), provided that the Trust continues to qualify as a QET at the time of the contribution.

D. In computing the income, non-capital loss and net-capital loss of the Corporation Partnership, for the purposes of applying subsection 107.3(1), the entire amount of any income or loss of the Trust for any taxation year of the Trust that ends in a particular fiscal period year of the Corporation Partnership can reasonably be considered to be the Corporation’s Partnership’s share of such income or loss

Rulings “C” and “E”

Provided that there is no change in the facts and circumstances since the issuance of the Prior Rulings Letters except as described herein, Rulings “C” and “E” will continue to apply after the implementation of the Proposed Transactions, subject to the conditions, limitations, qualifications and comments set out herein and in the Prior Rulings Letters.

New Rulings “F” and “G”

F. The Proposed Trust Amendments will not, in and by themselves, result in a disposition by the Trust of its property or in a resettlement of the Trust for the purposes of the Act.

G. Provided that the sole consideration received for the assignment of the QET Interest by the Corporation to GP Co. acting on behalf of the Partnership is the assumption of the Reclamation Obligations by the Partnership, no amount will be included in computing the income of the Corporation as a result of such assignment of the QET Interest. For greater certainty, the assumption of the Reclamation Obligations by the Partnership will not be considered additional consideration in respect of the transfer of the XXXXXXXXXX Assets by the Corporation to the Partnership.

COMMENTS

The advance income tax rulings in this Supplemental Ruling are subject to the conditions, limitations, qualifications and comments set out in the Prior Rulings Letters and this Supplemental Ruling.

Nothing in this Supplemental Ruling should be construed as implying that we are ruling on any tax consequences relating to the facts and proposed transactions described herein other than those specifically described in the rulings given above. In particular, nothing in this Supplemental Ruling should be construed as implying that the Canada Revenue Agency has agreed to or reviewed:

1. the reasonableness of any expenditure referred to in this Supplemental Ruling;

2. the person or persons subject to tax on funds distributed by the Trust;

3. whether the Trust is a valid trust under the laws of the XXXXXXXXXX;

4. whether the Proposed Transactions will result in a legal resettlement of the Trust under the laws of the XXXXXXXXXX;

5. the tax consequences of any amendments made to the Agreement before the date of this Supplemental Ruling;

6. any tax consequences relating to any future transactions, XXXXXXXXXX;

7. the availability of tax credits at the level of the beneficiaries of the Trust; and

8. the application of perpetuity legislation to the Trust.

The above advance income tax rulings are based on the Act and Income Tax Regulations in their present form and do not take into account any proposed amendments thereto, which if enacted, could have an effect on the above rulings. The rulings are given subject to the general limitations and qualifications set out in Information Circular 70-6R12 Advance Income Tax Rulings and Technical Interpretations dated April 1, 2022, and are binding on the Canada Revenue Agency provided that the proposed transactions are implemented as described above.

For greater certainty, these advance income tax rulings are based on the Agreement as amended on XXXXXXXXXX and approved by the Tribunal on XXXXXXXXXX and the Amended and Restated Trust Agreement, approved by the Tribunal on XXXXXXXXXX with effect as of XXXXXXXXXX. If amendments to the Amended and Restated Trust Agreement, are made after that time, the rulings provided may not apply unless the amendment is approved by the Tribunal and a supplemental ruling is issued.

Yours truly,

XXXXXXXXXX
Manager
Resources Section
Reorganizations Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch