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Unformatted text preview: tion, which clarifies that the negatively worded ownership test under article xxix a(2)(e) should be applied to each entity in the chain of ownership up to the top entity to determine whether there are any indirect non-qualifying shareholders. 56 Convention between Canada and switzerland for the avoidance of Double Taxation with respect to Taxes on income and on Capital, signed at berne on May 5, 1997 (herein referred to as “the Canada-switzerland treaty”). i nternational tax planning n 109 although us Opco fails the active trade or business test, the interest paid by Canco may still qualify for the treaty rate if more than 90 percent of the total vote and value of all shares of us Opco are owned, directly or indirectly, by
n qualifying persons; or other persons, each of whom is resident in a country that has a treaty with Canada and that is entitled to all benefits under that treaty. The first condition cannot be met because us Opco is not owned by a qualifying person. The second condition should be met because swissco is entitled to all of the ben...
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