(36) Subsections (5), (9), (12) and (15) apply to renunciations made after March 5, 1996, other than a renunciation made before 1999 in respect of consideration given
	(a) before March 6, 1996; or
	(b) under an agreement in writing made before March 6, 1996 or under the terms of a prospectus, preliminary prospectus, registration statement, offering memorandum or notice filed before March 6, 1996 with a public authority in Canada in accordance with securities legislation of a province.
	(37) Subsection (6) applies to expenses incurred after December 2, 1992.
	(38) Subsection (7) applies after March 5, 1996, except that the amount determined under subsection 66(12.6011) of the Act, as enacted by subsection (7), in respect of a renunciation by a corporation shall be determined as if each other corporation associated with the corporation were not so associated where the renunciation was made before 1999 in respect of consideration given
	(a) before December 6, 1996; or
	(b) under an agreement in writing made before December 6, 1996 or under the terms of a prospectus, preliminary prospectus, registration statement, offering memorandum or notice filed before December 7, 1996 with a public authority in Canada in accordance with securities legislation of a province.
	(39) Subsections (16) and (18) apply to expenses incurred after 1996, except that
	(a) those subsections do not apply to expenses incurred in January or February of 1997 in respect of an agreement that was made in 1995; and
	(b) for the purpose of applying paragraph 66(12.66)(a.1) of the Act, as enacted by subsection (16), to expenses incurred in 1998, any agreement made in 1996 is deemed to have been made in 1997.
	(40) Subsection (17) applies to expenses incurred after 1992.
	(41) Subsection 66(12.73) of the Act, as enacted by subsection (23), applies to purported renunciations made after 1996 except that, in respect of purported renunciations made before 1999, the portion of that subsection 66(12.73) before paragraph (a) shall be read as:
	(12.73) Where an amount that a corporation purports to renounce to a person under subsection (12.6), (12.601), (12.62) or (12.64) exceeds the amount it can renounce to the person under that subsection,
	(42) Subsection (27) applies to taxation years that end after December 5, 1996.
	(43) Subsection (28) applies after December 5, 1996.
	(44) Subsection (29) applies to fiscal periods that end after 1995.
	(45) Subsection (30) applies to fiscal periods that end after 1996.
	14. (1) The portion of subsection 66.1(2) of the Act before paragraph (a) is replaced by the following:
Deduction for certain principal- business corporations	(2) In computing the income for a taxation year of a principal-business corporation (other than a corporation that would not be a principal-business corporation if the definition ``principal-business corporation'' in subsection 66(15) were read without reference to paragraphs (h) and (i) of that definition), there may be deducted any amount that the corporation claims not exceeding the lesser of
	(2) The portion of subsection 66.1(3) of the Act before paragraph (a) is replaced by the following:
Expenses of other taxpayer	(3) In computing the income for a taxation year of a taxpayer that is not a principal-business corporation, or that is a corporation that would not be a principal-business corporation if the definition ``principal-business corporation'' in subsection 66(15) were read without reference to paragraphs (h) and (i) of that definition, there may be deducted such amount as the taxpayer claims not exceeding the total of
	(3) Paragraph (h) of the definition ``Canadian exploration expense'' in subsection 66.1(6) of the Act is replaced by the following:
	(g.1) any Canadian renewable and conservation expense incurred by the taxpayer,
	(h) subject to section 66.8, the taxpayer's share of any expense referred to in any of paragraphs (a) to (d) and (f) to (g.1) incurred by a partnership in a fiscal period thereof, if at the end of the period the taxpayer is a member of the partnership, or
	(4) The definition ``Canadian exploration expense'' in subsection 66.1(6) of the Act is amended by striking out the word ``or'' at the end of paragraph (j) and by adding the following after paragraph (k):
	(l) any amount (other than a Canadian renewable and conservation expense) included at any time in the capital cost to the taxpayer of any depreciable property of a prescribed class,
	(m) an expenditure incurred at any time after the commencemen t of production from a Canadian resource property of the taxpayer in order to evaluate the feasibility of a method of recovery of, or to assist in the recovery of, petroleum, natural gas or related hydrocarbons from the portion of a natural reservoir to which the Canadian resource property relates,
	(n) an expenditure incurred at any time relating to the injection of any substance to assist in the recovery of petroleum, natural gas or related hydrocarbons from a natural reservoir, or
	(o) the taxpayer's share of any consideration, expense, cost or expenditure referred to in any of paragraphs (j) to (n) given or incurred by a partnership,
	(5) Subsection 66.1(6) of the Act is amended by adding the following in alphabetical order:
``Canadian renewable and conservation expense'' « frais liés aux énergies renouvelables et à l'économie d'énergie au Canada »	``Canadian renewable and conservation expense'' has the meaning assigned by regulation, and for the purpose of determining whether an outlay or expense meets the criteria set out in the Regulations in respect of Canadian renewable and conservation expenses, the Technical Guide to Canadian Renewable and Conservation Expenses, as amended from time to time and published by the Department of Natural Resources, shall apply conclusively with respect to engineering and scientific matters;
	(6) Subsection 66.1(8) of the Act is repealed.
	(7) Subsections (1), (2) and (4) apply to taxation years that end after December 5, 1996.
	(8) Subsections (3) and (5) apply after December 5, 1996.
	(9) Subsection (6) applies after March 6, 1996.
	15. (1) The definition ``Canadian development expense'' in subsection 66.2(5) of the Act is amended by striking out the word ``or'' at the end of paragraph (h) and by adding the following after paragraph (i):
	(j) any amount included at any time in the capital cost to the taxpayer of any depreciable property of a prescribed class, or
	(k) the taxpayer's share of any consideration, expense, cost or expenditure referred to in any of paragraphs (h) to (j) given or incurred by a partnership,
	(2) Subsection (1) applies to taxation years that end after December 5, 1996.
	16. (1) The portion of subsection 66.7(10) of the Act after paragraph (b) and before paragraph (c) is replaced by the following:
	for the purposes of the provisions of the Income Tax Application Rules and this Act (other than subsections 66(12.6), (12.601), (12.602), (12.62) and (12.71)) relating to deductions in respect of drilling and exploration expenses, prospecting, exploration and development expenses, Canadian exploration and development expenses, foreign exploration and development expenses, Canadian exploration expenses, Canadian development expenses and Canadian oil and gas property expenses (in this subsection referred to as ``resource expenses'') incurred by the corporation before that time, the following rules apply:
	(2) Subsection (1) applies to taxation years that begin after 1998.
	17. (1) Paragraph 85(1.1)(b) of the Act is replaced by the following:
	(b) a capital property that is real property, or an interest in or an option in respect of real property, owned by a non-resident insurer where that property and the property received as consideration for that property are designated insurance property for the year;
	(2) Subsection (1) applies to dispositions that occur in an insurer's 1997 or subsequent taxation year.
	18. (1) Clause 87(2)(d)(ii)(C) of the Act is replaced by the following:
	(C) a reference in subparagraph 13(5)(b)(ii) to amounts that would have been deducted in respect of property in computing a taxpayer's income shall be construed as including a reference to amounts that would have been deducted in respect of that property in computing a predecessor corporation's income, and
	(2) Paragraph 87(2)(oo) of the Act is replaced by the following:
Investment tax credit	(oo) for the purpose of applying subsection 127(10.2) to any corporation, the new corporation is deemed to have had
	(i) a particular taxation year that
	(A) where it was associated with another corporation in the new corporation's first taxation year, ended in the calendar year that precedes the calendar year in which that first year ends, and
	(B) in any other case, immediately precedes that first year, and
	(ii) taxable income for the particular year (determined before taking into consideration the specified future tax consequences for the particular year) equal to the total of all amounts each of which is a predecessor corporation's taxable income for its taxation year that ended immediately before the amalgamation (determined before taking into consideration the specified future tax consequences for that year);
	(3) Subsection 87(2) of the Act is amended by adding the following after paragraph (oo):
Refundable investment tax credit and balance-due day	(oo.1) for the purpose of applying subparagraph 157(1)(b)(i) and the definition ``qualifying corporation'' in subsection 127.1(2) to any corporation, the new corporation is deemed to have had
	(i) a particular taxation year that
	(A) where it was associated with another corporation in the new corporation's first taxation year, ended in the calendar year that precedes the calendar year in which that first year ends, and
	(B) where clause (A) does not apply, immediately precedes that first year,
	(ii) taxable income for the particular year (determined before taking into consideration the specified future tax consequences for the particular year) equal to the total of all amounts each of which is a predecessor corporation's taxable income for its taxation year that ended immediately before the amalgamation (determined before taking into consideration the specified future tax consequences for that year), and
	(iii) a business limit for the particular year equal to the total of all amounts each of which is a predecessor corporation's business limit for its taxation year that ended immediately before the amalgamation;
	(4) Subsection 87(2.2) of the Act is replaced by the following:
Amalgama- tion of insurers	(2.2) Where there has been an amalgamation and one or more of the predecessor corporations was an insurer, the new corporation is, notwithstanding subsection (2), deemed, for the purposes of paragraphs 12(1)(d), (e), (e.1), (i) and (s) and 20(1)(l), (l.1), (p) and (jj) and 20(7)(c), subsection 20(22), sections 138, 138.1, 140, 142 and 148 and Part XII.3, to be the same corporation as, and a continuation of, each of those predecessor corporations.
	(5) The portion of subsection 87(4.4) of the Act after paragraph (d) and before paragraph (e) is replaced by the following:
	for the purposes of subsection 66(12.66) and Part XII.6 and for the purposes of renouncing an amount under subsection 66(12.6), (12.601) or (12.62) in respect of Canadian exploration expenses or Canadian development expenses that would, but for the renunciation, be incurred by the new corporation after the amalgamation,
	(6) Subsection (1) applies to taxation years that begin after 1996.
	(7) Subsections (2) and (4) apply to amalgamations that occur after 1995, except that, for amalgamations that occur in 1996, the expression ``any corporation'' in paragraph 87(2)(oo) of the Act, as enacted by subsection (2), shall be read as ``the new corporation''.
	(8) For amalgamations that occur after May 23, 1985 and before 1996, paragraph 87(2)(oo) of the Act shall be read without reference to the expression ``paragraph 127.1(2)(a) and subparagraph 157(1)(b)(i)''.
	(9) Subsection (3) applies to amalgamations that occur after May 23, 1985, except that,
	(a) for amalgamations that occur before 1997, the expression ``any corporation'' in paragraph 87(2)(oo.1) of the Act, as enacted by subsection (3), shall be read as ``the new corporation'';
	(b) for the purpose of applying that paragraph for the purpose of the definition ``qualifying corporation'' in subsection 127.1(2) of the Act, the business limits referred to in that paragraph, for taxation years that ended after June 1994 and began before 1996, shall be determined under section 125 of the Act as that section read in its application to taxation years that ended before July 1994; and
	(c) clause 87(2)(oo.1)(i)(A) of the Act, as enacted by subsection (3), does not apply
	(i) for the purpose of applying the definition ``qualifying corporation'' in subsection 127.1(2) of the Act to taxation years that ended before July 1994, and
	(ii) for the purpose of applying subparagraph 157(1)(b)(i) of the Act to taxation years that end before 1998.
	(10) Subsection (5) applies to amalgamations that occur after 1995, except that the expression ``subsection 66(12.6), (12.601) or (12.62)'' in subsection 87(4.4) of the Act, as amended by subsection (5), shall be read as ``subsection 66(12.6), (12.601), (12.62) or (12.64)'' in respect of amalgamations that occur before 1999.
	19. (1) Paragraph 88(1)(e.8) of the Act is replaced by the following:
	(e.8) for the purpose of applying subsection 127(10.2) to any corporation (other than the subsidiary)
	(i) where the parent is associated with another corporation in a taxation year (in this paragraph referred to as the ``current year'') of the parent that begins after the parent received an asset of the subsidiary on the winding-up and that ends in a calendar year,
	(A) the parent's taxable income for its last taxation year that ended in the preceding calendar year (determined before taking into consideration the specified future tax consequences for that last year) is deemed to be the total of
	(I) its taxable income for that last year (determined before applying this paragraph to the winding-up and before taking into consideration the specified future tax consequences for that last year), and
	(II) the total of the subsidiary's taxable incomes for its taxation years that ended in that preceding calendar year (determined without reference to clause (B) and before taking into consideration the specified future tax consequences for those years), and
	(B) the subsidiary's taxable income for each of its taxation years that ends after the first time that the parent receives an asset of the subsidiary on the winding-up of the subsidiary is deemed to be nil, and
	(ii) where the parent received an asset of the subsidiary on the winding-up before the current year and is not associated with any corporation in the current year, the parent's taxable income for its immediately preceding taxation year (determined before taking into consideration the specified future tax consequences for that preceding year) is deemed to be the total of
	(A) its taxable income for that preceding taxation year (determined before applying this paragraph to the winding-up and before taking into consideration the specified future tax consequences for that preceding taxation year), and
	(B) the total of the subsidiary's taxable incomes for its taxation years that ended in the calendar year in which that preceding taxation year ended (determined before taking into consideration the specified future tax consequences for those years);
	(2) Subsection 88(1) of the Act is amended by adding the following after paragraph (e.8):