Control of Corporations Quiz

If either corporation is controlled directly or indirectly by a person related to the person who controls the other.

When D, who is C's son, owns 51% of I and C owns 75% of H.

One person must control a corporation and be related to each member of a group that controls the other corporation.

<p>J and K are associated since D, who owns 75% of J and 25% of K, is related to all the members of the group that control K.</p> Signup and view all the answers

<p>Simultaneous control refers to a situation where A owning 60% of F results in A and B being a group that controls F and G.</p> Signup and view all the answers

<p>Corporations D and E are associated under category (b) because C owns 80% of D and 60% of E.</p> Signup and view all the answers

<p>Associated control occurs when the same person or group of persons control multiple corporations, as defined in Section 256(1)(b).</p> Signup and view all the answers

<p>The 'last resort rule' states that if associated control is not found through Section 256(1), then it can be established through cross ownership of shares as outlined in Section 256(1)(c).</p> Signup and view all the answers

<p>The 25% cross ownership threshold is significant because it indicates a level of control between related corporations, as required by Section 256(1)(c) and (d).</p> Signup and view all the answers

<p>Section 256(1.5) states that an individual is related to themselves, which is a unique aspect of determining control by a related person.</p> Signup and view all the answers

<p>Control by a related group and cross ownership requires each controlled by a related group, with each member related to each member of the other group, and at least 25% cross ownership between both corporations.</p> Signup and view all the answers

<p>By combining two related groups, the total ownership can exceed the 25% cross ownership threshold, allowing for control as per Section 256(1)(e).</p> Signup and view all the answers

<p>Simultaneous control refers to a situation where A controls B who in turn controls C, resulting in A also being considered to control C.</p> Signup and view all the answers

<p>If the parent (HoldCo) would control the subsidiary (XCo) if it were not controlled by Mr X, then the subsidiary (XCo) is considered to be controlled by both the parent (HoldCo) and Mr X.</p> Signup and view all the answers

<p>A Subject Corporation is one that would be controlled by a group of persons in the first tier if no corporations were controlled by any person/group.</p> Signup and view all the answers

<p>In the case of a Subject Corporation, if no corporations are controlled by any person/group, then control rests with the first tier group.</p> Signup and view all the answers

<p>Control can be exerted by the first tier group as well as those who control look-through corporations.</p> Signup and view all the answers

<p>Control by related persons refers to situations where individuals or groups indirectly control a corporation through a series of ownership relationships.</p> Signup and view all the answers