Regulation 9001

CCRA stated:

Paragraph 9001(2)(a) … provides that a share of the capital stock of a corporation is a prescribed property of a taxpayer if, immediately after the time at which the taxpayer acquired the share, the corporation was a qualified small business corporation, and the corporation continued to be a qualified small business corporation for one year after that time. If the corporation ceases to be a qualified small business corporation after the one-year period following the time at which the taxpayer acquired the share, we are of the view that the share will remain a prescribed property, within the meaning of subsection 9001(2) … .

CCRA indicated that where a taxpayer exchanges shares referred to in Reg. 9001(2) in favour of a corporation other than the issuer of the shares, will the shares received in exchange for the taxpayer's shares will not be property referred to in Reg. 9001(2) by virtue of Reg. 9001(2)(b), starting:

[F]or a share of the capital stock of a corporation issued as a result of an exchange to be property described in paragraph 9001(2)(b) of the Regulations, it must be issued by the corporation that issued the exchanged share.