Nisga'a Nation Taxation Agreement Amendment Agreement (no. 2)

THIS AMENDMENT AGREEMENT dated for reference March 31, 2019.

BETWEEN:

HER MAJESTY THE QUEEN IN RIGHT OF CANADA, as represented by the Minister of Finance

("Canada")

OF THE FIRST PART

AND:

HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF BRITISH COLUMBIA, as represented by the Minister of Finance

("British Columbia")

OF THE SECOND PART

AND:

NISGA'A NATION, as represented by the Nisga'a Lisims Government Executive

(the "Nisga'a Nation")

OF THE THIRD PART

(together, "the Parties")

WHEREAS:

The Nisga'a Nation, Canada and British Columbia have entered into the Nisga'a Final Agreement which provides that the Parties will enter into a Taxation Agreement;
The Parties entered into a Taxation Agreement on May 11, 2000 and amended it by way of the Nisga'a Nation Taxation Agreement Amendment Agreement, dated for reference April 1, 2013 (as amended, the "Nisga'a Nation Taxation Agreement");
The Parties now wish to further amend the Nisga'a Nation Taxation Agreement;
Paragraph 54 of the Nisga'a Nation Taxation Agreement provides that any amendment must be in writing and executed by all Parties.

NOW THEREFORE in consideration of the premises and the covenants and agreements set out below, the Parties agree as follows:

AMENDMENTS

Paragraph 2 of the Nisga'a Nation Taxation Agreement is amended by adding the following definition immediately following the definition of "New Housing Transition Tax and Rebate Act":

"Nisga'a settlement trust", at any time, means a trust that at that time has the characteristics set out in paragraphs (a) to (g) of the definition "Nisga'a settlement trust" in chapter 15 of the Nisga'a Treaty or has the following characteristics:
1. the trust is resident in Canada;
2. the beneficiaries of the trust are limited to the Nisga'a Nation, any Nisga'a Village, another Nisga'a settlement trust, all Nisga'a citizens, all Nisga'a citizens in any Nisga'a Village, or any registered charity or non-profit organization, within the meaning of the Income Tax Act, that in the reasonable opinion of the trustees directly or indirectly benefits one or more Nisga'a citizens, or any combination of those entities and persons;
3. the investment of the funds of the trust is restricted to:
  1. investment instruments that are described as qualified investments for a trust governed by a registered retirement savings plan within the meaning of section 146 of the Income Tax Act or in any other investments that may be agreed upon from time to time in writing by the Nisga'a Nation, Canada, as represented by the Minister of Finance, and British Columbia, as represented by the Minister of Finance;
  2. interests as a member of a partnership where:
    1. by operation of any law governing the arrangement in respect of the partnership, the liability of the trust is limited;
    2. the trust deals at arm's length with each general partner of the partnership; and
    3. the trust, or the trust together with persons and partnerships with which it does not deal at arm's length, holds interests in the partnership that:
      1. have a fair market value of not more than 20% of the fair market value of the interests of all members in the partnership; or
      2. have a fair market value of more than 20% of the fair market value of the interests of all members in the partnership as a result of a redemption of interests in the partnership, provided that the excess over 20% is disposed of by the end of the second calendar year following the calendar year in which the excess arose or other later time that the Minister of National Revenue may consider reasonable;
  3. loans to Nisga'a citizens, the Nisga'a Nation, a Nisga'a Village, or a Nisga'a government corporation at a rate of interest equal to the rate prescribed under regulation 4301(c) of the Income Tax Act in effect at the time the loan was made or last renewed;
  4. investments in a share of a Nisga'a government corporation where the average annual rate of dividends on that share over any five year period cannot exceed the rate prescribed under regulation 4301(c) of the Income Tax Act at the beginning of that period, and if the amount receivable on redemption of the share or on liquidation of the corporation is limited the amount of the consideration for which the share was originally issued; and
  5. low interest or interest free loans to a Nisga'a citizen, or a partnership or trust in which Nisga'a citizens hold all the interests as partners or beneficiaries, where the purpose of the loan is to assist the borrower to:
    1. acquire, construct or renovate a residential property for their own habitation in British Columbia;
    2. attend courses to further their own education, technical or vocational skills, or attend courses in native studies, culture or language programs; or
    3. acquire funding for purposes of carrying on a business on Nisga'a Lands or Nisga'a Fee Simple Lands, where the borrower is unable to borrow from ordinary commercial lenders at normal commercial rates;
    where, at the time the loan was made, bona fide arrangements were made for repayment of the loan within a reasonable period of time;
4. the trust is not permitted to
  1. carry on a business as a proprietor or member of a partnership, except that for this purpose, if a trust holds an interest described in (c)(ii), the trust shall not, solely because of its acquisition and holding of that interest, be considered to carry on any business or other activity of the partnership; or
  2. acquire any beneficial interest in a trust engaged in a business where one or more of the Nisga'a Nation, a Nisga'a Village, a Nisga'a government corporation, a Nisga'a settlement trust or a Nisga'a citizen, either alone or in combination, holds more than 10% of all the beneficial interests in the trust;
5. the trust does not borrow money except as required to finance the acquisition of qualified investments or to carry out its operations;
6. contributions to the trust are limited to contributions received from the Nisga'a Nation of capital transfer payments received by it under the Capital Transfer and Negotiation Loan Repayment Chapter or amounts received from another Nisga'a settlement trust where substantially all of the funds of that contributing trust reasonably can be considered to have been derived from a contribution to a Nisga'a settlement trust by the Nisga'a Nation of capital transfer payments received by it under the Capital Transfer and Negotiation Loan Repayment Chapter and income and gains derived therefrom; and
7. the trust is not permitted to make any distribution other than to one or more beneficiaries in accordance with the trust, or to another Nisga'a settlement trust."
The Nisga'a Nation Taxation Agreement is amended by deleting paragraph 9.
Paragraph 11 of the Nisga'a Nation Taxation Agreement is amended by:
1. adding "and" after "engaged in by the claimant for profit or gain;" in subparagraph (a);
2. replacing "; and" in subparagraph (b) with "."; and
3. deleting subparagraph (c).
The Nisga'a Nation Taxation Agreement is amended by deleting paragraph 12.
Subparagraph 17(b) of the Nisga'a Nation Taxation Agreement is amended by deleting ", within Nisga'a Lands,".
Paragraph 23 of the Nisga'a Nation Taxation Agreement is amended by adding ", Nisga'a Public Institutions" after "Nisga'a Villages".
Paragraph 28 of the Nisga'a Nation Taxation Agreement is amended by:
1. effective January 1, 2008, deleting subparagraph (b); and
2. deleting subparagraph (c) and adding new subparagraph (b) as follows:
  
  "(b) a Nisga'a settlement trust is subject to tax under Part I of the Income Tax Act and for that purpose its taxable income for a taxation year will be calculated as the total of:
  1. the amount of taxable income that would be determined under the Income Tax Act for the taxation year in respect of its properties, or its dispositions of properties, that were not investments referred to in subparagraph (c) of the definition of "Nisga'a settlement trust" or that were not acquired in the course of carrying on a permitted activity of the trust; and
  2. any amount contributed to the trust that is not permitted under the terms of the trust; and"; and
3. renumbering subparagraph (d) as subparagraph (c).
Paragraph 30 of the Nisga'a Nation Taxation Agreement is deleted and replaced with:

"30. If the Minister of National Revenue revokes the status of a Nisga'a settlement trust, the taxation year of the trust that would otherwise have included the time of revocation will be deemed to end immediately before the time of the revocation, and the Nisga'a settlement trust will be deemed to have disposed of each of its assets immediately before that time for proceeds equal to its fair market value, and to have re-acquired the asset at the time of revocation at a cost equal to its fair market value at that time, and for the purposes of calculating the taxable income of the trust in subparagraph 28(b), the amount by which the fair market value of the asset exceeds (or is less than) the cost amount of the asset will be deemed to be a capital gain (or capital loss) from the disposition of property that was not an investment referred to in subparagraph (c) of the definition of "Nisga'a settlement trust" or that was not acquired in the course of carrying on a permitted activity of the trust."
Paragraph 34 of the Nisga'a Nation Taxation Agreement is amended by deleting "tax treatment" and replacing it with "treatment under the Income Tax Act".
Paragraph 36 of the Nisga'a Nation Taxation Agreement is amended by deleting "Movable Cultural Property Program" and replacing it with "Minister designated as the Minister for the purposes of the Cultural Property Export and Import Act".

CONTINUING FORCE AND EFFECT

For greater certainty, the Nisga'a Nation Taxation Agreement as amended by this Amendment Agreement continues in full force and effect in accordance with its terms.

FURTHER ASSURANCES

The Parties will execute any other documents and do any other things that may be necessary to carry out the intent of this Amendment Agreement.

HEADINGS

In this Amendment Agreement, headings are for convenience only, do not form a part of this Amendment Agreement and in no way define, limit, alter or enlarge the scope or meaning of any provision of this Amendment Agreement.

NO ASSIGNMENT

This Amendment Agreement may not be assigned, either in whole or in part, by any Party.

ENUREMENT

This Amendment Agreement will ensure to the benefit of and be binding upon the Parties and their respective successors.

COUNTERPARTS

This Amendment Agreement may be signed in one or more counterparts. A signed counterpart may be delivered to another party by facsimile transmission or scanned and e-mailed and a facsimile or scanned and e-mailed signature will be accepted the same as an original signature. Signed counterparts held by a party, taken together, will constitute one and the same instrument.

EFFECTIVE DATE

Paragraph 1 is effective on the later of:
1. the date it is executed by the last of the Parties to execute it; and
2. the date on which the definition of "Nisga'a settlement trust" in paragraph 1 of Chapter 15 of the Nisga'a Final Agreement is amended by deleting "means any trust having the following characteristics" and substituting "at any time means a Nisga'a settlement trust as defined in the Taxation Agreement referred to in paragraph 21 of the Tax Chapter or any trust having the following characteristics".
Except as otherwise provided in paragraphs 7 and 17, this Amendment Agreement is effective on the date it is executed by the last of the Parties to execute it.

EXECUTED on the 17 day of January, 2020 in the presense of:

HER MAJESTY THE QUEEN IN RIGHT OF CANADA, as represented by the Minister of Finance
Minister of Finance
Bill Morneau

EXECUTED on the 12 day of February, 2020 in the presense of:

HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF BRITISH COLUMBIA, as represented by the Minister of Finance
Minister of Finance
Carole James

EXECUTED on the 3 day of February, 2020 in the presense of:

NISGA'A NATION, as represented by the Nisga'a Lisims Government Executive
President
Eva Clayton

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Date modified:: 2025-08-05

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