14 September 2017 External T.I. 2017-0685121E5 F - Associated corporations -- summary under Subparagraph 256(1.2)(f)(ii)

Three children each of whom wholly-owns a Childco are also, along with their parent, the discretionary beneficiaries of a family trust owning all the non-voting common shares of Parentco, whose voting shares are held by the parent. Each Childco is associated with Parentco given that s. 256(1.2)(f)(ii) deems a discretionary beneficiary to own the trust shares for association purposes. Accordingly (and absent an s. 256(2)(b)(ii) election), under the “transitivity” rule in s. 256(2)(a), the Childcos are also associated with each other.