89 C.P.T.J. - Q. 14

Where an amalgamated corporation on the amalgamation acquires pre-November 13, 1981 flow-through shares owned by a predecessor, those shares will not be deemed to be inventory because the amalgamated corporation did not acquire them in the circumstances described in s. 66.3(1)(a).

Because there is no provision like s. 87(1.2) deeming an amalgamated corporation to be a continuation of each predecessor, where a corporation has issued flow-through shares and amalgamates with another corporation prior to incurring the expenditures, the amalgamated corporation will not be able to renounce expenditures incurred subsequent to the amalgamation, unless the amalgamation was described in s. 87(1.1).