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Unformatted text preview: e business activities conducted by the related foreign corporation and the activities conducted by the other foreign corporation that produces income from property. The activities resulting in the income from property must be dependent upon and would not have taken place but for the active business activities taking place. The fact that activities are similar is not enough to demonstrate a link. if the term “in connection with” in the treaty is interpreted in a manner similar to its interpretation in subparagraph 95(2)(a)(i), then a high degree of connection or dependency must exist between active business income in the source country and active business income in the resident country to establish that one business is upstream, downstream, or complementary to the other business. in respect of dividend income earned by usco (described above) and capital gains realized by usco on the disposition of shares in a Canco subsidiary (described below), the Cra stated at the 2008 round table42 that the active trade or business exception is available to usco if, among other conditions, Canco’s active business is the same a...
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