Ideas in this flowchart

• Access to the s. 55(3)(a) safe harbour in an amalgamation and spin-off structure
• S. 55(3.01)(b) may deem an amalgamated corporation to be a continuation of each predecessor for s. 55(3)(a) purposes.
• The example involves a proposed spin-off of Holdco’s interest in Subco.
• An individual wholly owns Holdco; Holdco owns 100% of Opco and 70% of Subco, while unrelated persons own the remaining 30% of Subco.
• The objective is to spin off Holdco’s 70% shareholding in Subco.
• The spin-off is implemented through a series of related transactions.
• The individual rolls a portion of the Holdco shares to Newco.
• Holdco rolls its 70% shareholding in Subco to Newco in exchange for Newco shares.
• The cross-shareholdings are redeemed.
• The unrelated persons’ 30% shareholding remains unaffected.
• As a result, none of s. 55(3)(a)(i) to (v) is engaged.
• The s. 55(3)(a) exemption applies.