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Unformatted text preview: the 90 percent shareholder group”) who satisfy the following three conditions: 1. the person must be resident of a third country with which Canada has a comprehensive tax treaty and be entitled to all benefits under this treaty;51 2. the person must meet the requirements of the qualifying person test or the active trade or business test on the assumption that the person is resident in the united states, and for purposes of the active trade or business test, the business is carried on in the united states;52 and 3. the rate of Canadian withholding tax on the income for which benefits are sought must be at least as low under the treaty between Canada and the person’s resident country as under the Canada-us treaty.53 The ownership requirement does not refer to an ultimate ownership test, as some recent us treaties do.54 Therefore, the affirmatively worded directly or indirectly test in article xxix a(4)(a) implies that it is sufficient to look up the chain of ownership until finding a group of indirect shareholders (of the us resident in this case) that meets the requir...
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