The prohibition under the PBSA against investing more than 10% of a pension plan’s assets in any one investment (the “10% quantitative limit”) is applied at the level of a pension plan, and not at the level of a pension corporation. Does this approach apply to the permitted investment reference in the preamble to s. 149(1)(o.2)(iii)? In finding that the 10% quantitative limit is applied at the pension plan level rather than at the pension corporation level, the Directorate stated:
[T]he policy intent of the provision is to defer to the investment requirements of the PBSA or provincial pension benefits legislation in establishing the investments that a tax-exempt pension investment corporation is permitted to make.
As a result… it is appropriate to interpret this provision in a manner that is consistent with the manner in which the 10% quantitative limit is interpreted and applied for purposes of the PBSA and provincial pension benefits legislation. Accordingly, we will consider the 10% quantitative limit to be satisfied for the purpose of the preamble to subparagraph 149(1)(o.2)(iii) if it is satisfied for purposes of the PBSA or provincial pension benefits legislation….
This position also extends to the same investment requirements contained in clause 149(1)(o.2)(ii)(B) and subclause 149(1)(o.2)(ii.1)(B)(IV).