Canada: Canadian Federal Court pulls the reins in (slightly) on foreign information requests
International Tax Review is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2024

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Canada: Canadian Federal Court pulls the reins in (slightly) on foreign information requests


Jean Marc Gagnon

Alexandra Carbone

In Amdocs Canadian Managed Services Inc. (ACMS), the Federal Court denied the Canada Revenue Agency's (CRA) request under section 231.7 of the Income Tax Act, Canada (Act) to compel ACMS to provide the CRA with documents and information requested in the course of a transfer pricing audit.

The CRA alleged that queries had not been satisfactorily answered, leaving the CRA in a position where it would have to audit and assess ACMS based on incomplete information.

ACMS contended that although the documents requested were not within its control, it had taken reasonable steps to obtain the information and provide it to the CRA. ACMS submitted that it could not be compelled to provide documents that are not in its possession or control or to create documents that did not exist. If such documents existed, they were located outside Canada, outside ACMS's control and did not fall within the provisions supporting the CRA's application.

The judge noted that it is within the CRA's prerogative to request information over the course of the audit, and found that ACMS had failed to comply in this regard. He also found that ACMS had made reasonable efforts to acquire the documentation at issue, thereby falling within an exception to complying with information requests. Noting that there was no purpose in ordering ACMS to do something it could not do, the judge declined to grant the CRA the relief sought.

Although the taxpayer was successful in this case, the judge acknowledged the CRA's broad discretion to request information from taxpayers during an audit and that other provisions of the Act would have better served CRA's interest. The CRA may have to be more accepting of taxpayers that have made reasonable efforts to comply with its requests but are unable to do so, or be more specific in its information requests.

Jean Marc Gagnon ( and Alexandra Carbone (

Blake, Cassels & Graydon

Tel: +1 514 982 5025 and +1 514 982 5034


more across site & bottom lb ros

More from across our site

KPMG has exclusive access to the tool for three years in the UK, giving it an edge over ‘big four’ rivals
But the US tax agency’s advice is consistent with OECD guidance and shouldn’t surprise anyone, other experts tell ITR
A survey of more than 25,000 in-house counsel reveals that diversity initiatives are a high priority when choosing external counsel
The report is aimed at helping 'low-capacity countries', the OECD has claimed
The UK tax agency appears to be going after easier, lower value targets, one lawyer has claimed
Criminal experts have told ITR that the case of Ulf Johannemann emphasises the fine line between tax avoidance and tax evasion
The ATO workers were among nearly 57,000 people who were duped into claiming fake GST refunds, while Kuwait signed a double taxation treaty with the UAE
However, ICAP may not provide the legal certainty of an APA and tax authorities will have limited capacity, experts argue
ITR+ has launched the Talent Tracker, an interactive database that collates reported partner moves across the legal tax market
The tool is available to more than 2,000 PwC tax professionals and is designed to boost client service
Gift this article