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Volume 53, No. 12

B.C. Reg. 188/2010

The British Columbia Gazette,

Part II

June 29, 2010

B.C. Reg. 188/2010 , deposited June 25, 2010, pursuant to the INTERNATIONAL BUSINESS ACTIVITY ACT [Section 65]. Order in Council 452/2010, approved and ordered June 24, 2010.

On the recommendation of the undersigned, the Administrator, by and with the advice and consent of the Executive Council, orders that the International Financial Activity Regulation, B.C. Reg. 327/2004, is amended

(

a) effective June 3, 2010, as set out in

section 1 and 2 (

b) of the attached Schedule,

(

b) effective March 3, 2010, as set out in sections 2 (a), (

c) and (d), 3, 4 (

a) and 5 to 7 of the attached Schedule, and

(

c) effective September 1, 2004, as set out in

section 4 (

b) of the attached Schedule.

— C. HANSEN, Minister of Finance and Deputy Premier ; I. CHONG, Presiding Member of the Executive Council .

Schedule

1 The title of the International Financial Activity Regulation, B.C. Reg. 327/2004, is amended by striking out " Financial " and substituting " Business ".

Section 1 is amended

(

a) by renumbering it as

section 1 (1),

(

b) in the definition of "Act" , by striking out " Financial " and substituting " Business ",

(

c) by adding the following definition:

"eligible class of patents" means a class of patents referred to in

section 5;

(

d) by adding the following subsections:

(2) In the Act and this regulation:

"designated international business" means an international film distribution business;

"international film distribution business" in relation to a corporation means a business carried on by the corporation through a fixed place of business in British Columbia, all of the revenue of which is derived from one or more of the following transactions:

(

a) selling, assigning or licensing rights to a non-resident person to distribute outside Canada a film or television production, other than a production that is pornography;

(

b) selling, assigning or licensing rights to a non-resident person to exploit outside Canada any thing related to the production;

"international patent business" in relation to a corporation means a business carried on by the corporation through a fixed place of business in British Columbia, all of the revenue of which is derived from one or more of the following transactions:

(

a) selling, assigning or licensing, to a non-resident person, a patent within an eligible class of patents;

(

b) selling, to a non-resident person, a good or service in respect of which the sales revenue is principally derived from an invention for which a patent within an eligible class of patents is owned by the corporation;

"qualifying transaction" means a transaction the revenue of which is derived from an international business, other than an international financial business;

(3) For the purposes of paragraph (

a) of the definition of "international patent business" in subsection (2), licensing includes a joint research and development licensing agreement that is directly related to a patent within an eligible class of patents.

(4) In

section 21 (7) and (8) of the Act, "remuneration" means

(

a) salaries,

(

b) wages,

(

c) commissions, and

(

d) other remuneration,

but does not include an amount described in

section 7 of the federal Act.

Section 1.1 (1) and (2) is amended by adding " financial " after " qualifying ".

Section 4 is amended

(

a) by repealing subsections (1), (6) and (7.1), and

(

b) by repealing subsection (8) and substituting the following:

(8) For the purposes of

section 2 (2) (

t) of the Act, the following are prescribed financial activities of a corporation:

(

a) with respect to a corporation that is a savings institution, acting

(

i) as trustee of a trust that, at all relevant times, is non-resident,

(ii) as an executor or administrator of the estate of a non-resident person, all the beneficiaries of which are at all relevant times non-residents,

(iii) as guardian of the estate of a minor who is non-resident, or

(iv) as committee of the estate of a mentally incompetent person who is non-resident;

(

b) with respect to a corporation that is a savings institution or a corporation affiliated with a savings institution, providing services

(

i) to a non-resident person in respect of the Immigration and Refugee Protection Act (Canada), or

(ii) to a non-resident person in respect of that person

(

A) seeking leave to enter the United Kingdom as an investor,

(

B) seeking an extension of stay in the United Kingdom as an investor, or

(

C) seeking indefinite leave to remain in the United Kingdom as an investor.

Section 5 is amended

(

a) in subsection (1), by striking out "

section 2 (2) (q.1) and (q.2) of the Act, the class of patents prescribed " and substituting " the definition of "international patent business", the eligible class of patents ", and

(

b) in subsection (2), by striking out " class of patents prescribed " and substituting " eligible class of patents ".

Section 6 is repealed and the following is substituted:

Foreign currency transaction

(1) For the purposes of paragraph (

b) of the description of "IB income" in

section 19 of the Act, a prescribed foreign currency agreement is an agreement that

(

a) provides for the purchase, sale or exchange of currency by the international financial business, and

(

b) can reasonably be considered to have been made by the international financial business of the corporation to reduce its risk of fluctuations in the value of the currency in which an amount is denominated, if the amount is an asset or liability of the international financial business and is incident to an international financial activity referred to in the applicable section.

(2) For the purposes of paragraph (

b) of the description of "IB income" in sections 19.01 and 19.02 of the Act, a prescribed foreign currency agreement is an agreement that

(

a) provides for the purchase, sale or exchange of currency by the international business, and

(

b) can reasonably be considered to have been made by the international business of the corporation to reduce its risk of fluctuations in the value of the currency in which an amount is denominated, if the amount is an asset or liability of the international business and is incident to a qualifying transaction referred to in the applicable section.

7 The following

section is added:

Registration of administrative support specialists

and executive specialists

7 In addition to the other requirements of sections 13.1 or 13.2 of the Act, the following requirements apply to an individual referred to in those sections:

(

a) the individual must have been non-resident at the end of the individual's taxation year preceding the year of application;

(

b) the individual must enter into the written employment contract referred to in those sections on or after March 3, 2010;

(

c) the individual, and any person related to the individual, must deal at arm's length with the registered corporation.

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