What criteria does CRA apply characterizing a foreign entity, that has issued a security held by a Canadian resident, as a corporation, trust, partnership, or other entity? After summarizing it two-step approach to entity classification, CRA stated:
The CRA has not established a list of essential features that a foreign Entity must possess to be classified in any of the different categories of recognized Entities … . However, the most important attributes appear to us to be the nature of the relationship between the parties and the rights and obligations of the parties arising under the foreign law and relevant legal documents. This could include the nature of the rights to the assets of the Entity, the right to participate in the profits or receive distributions, the right to vote or participate in the decisions of the Entity, the right to share in the distributions of assets during the liquidation of the Entity as well as the obligations of the various parties involved. Status as a separate legal entity appears to us to be a distinctive but not exclusive feature of corporations.