O. Reg. 110/16: TRANSFER TAX ON MUNICIPAL ELECTRICITY PROPERTY

 

ontario regulation 110/16

made under the

Electricity Act, 1998

Made: April 22, 2016
Filed: April 25, 2016
Published on e-Laws: April 25, 2016
Printed in The Ontario Gazette: May 14, 2016

Amending O. Reg. 124/99

(TRANSFER TAX ON MUNICIPAL ELECTRICITY PROPERTY)

1. Section 1 of Ontario Regulation 124/99 is revoked and the following substituted:

Prescribed Percentage

1. The following percentages are prescribed for the purposes of subsection 94 (1) of the Act:

1. 22 per cent, in respect of a transfer that meets the following conditions:

i. The transfer is made after December 31, 2015.

ii. If the approval of the Ontario Energy Board for the transfer is required under the Ontario Energy Board Act, 1998, an application for approval of the transfer is made to the Ontario Energy Board before January 1, 2019.

iii. A written agreement to make the transfer is complete before January 1, 2019 and is not materially changed after that date.

2. 33 per cent, in respect of all other transfers.

2. Section 3 of the Regulation is amended by adding the following subsections:

(22) Subsection 94 (1) of the Act does not apply to a transfer by a municipal corporation or by a municipal electricity utility of an interest in property described in subsection 94 (1), (1.1) or (2) of the Act if the following conditions are satisfied:

1. The transfer is made after December 31, 2015.

2. The total number of customers of the municipal electricity utility is less than 30,000, as set out in the Ontario Energy Board 2014 Yearbook of Electricity Distributors.

3. If at any time between December 31, 2014 and the date of the transfer, the municipal corporation or municipal electricity utility acquires an interest, option, warrant or right described in subsection (23), the total number of consumers of the municipal corporation or municipal electricity utility is less than 30,000, as determined in accordance with subsection (24).

4. If the approval of the Ontario Energy Board for the transfer is required under the Ontario Energy Board Act, 1998, an application for approval of the transfer is made to the Ontario Energy Board before January 1, 2019.

5. A written agreement to make the transfer is complete before January 1, 2019 and is not materially changed after that date.

6. The municipal corporation or the municipal electricity utility provides the Minister with written notice of the transfer before the date of the transfer and confirms in the notice that the transfer satisfies the conditions set out in paragraphs 1 to 5.

(23) For the purposes of paragraph 3 of subsection (22), the following are the interests, options, warrants and rights:

1. An interest in a municipal electricity utility, partnership or trust that generates transmits, distributes or retails electricity in Ontario.

2. An option, a warrant or a right under a contract in equity or otherwise to acquire an interest in a municipal electricity utility, partnership or trust that generates, transmits, distributes or retails electricity in Ontario.

3. An interest in property described in subsection 94 (1), (1.1) or (2) of the Act from a municipal electricity utility, partnership or trust that includes the right to provide electricity to consumers.

(24) For the purposes of paragraph 3 of subsection (22), the total number of consumers of the municipal corporation or municipal electricity utility is the sum of the following:

1. The total number of consumers of the municipal corporation or municipal electricity utility.

2. The total number of consumers of each person, partnership or trust that does not deal at arm’s length with, or is affiliated with, the municipal corporation or municipal electricity utility.

3. The total number of consumers of each person, partnership or trust in which the municipal corporation or municipal electricity utility has a direct or indirect interest.

(25) For the purposes of subsection (24),

(a) a person, partnership or trust is deemed not to deal at arm’s length with a municipal corporation or municipal electricity utility if they do not deal with each other at arm’s length within the meaning of section 251 of the Income Tax Act (Canada); and

(b) a person, partnership or trust is deemed to be affiliated with a municipal corporation or municipal electricity utility if they are affiliated with each other within the meaning of section 251.1 of the Income Tax Act (Canada).

Commencement

3. This Regulation is deemed to have come into force on April 23, 2015.

Made by:

Charles Sousa

Minister of Finance

Date made: April 22, 2016