By Marc Cuerrier, General Counsel
Civil Code Section,
Department of Justice Canada

This text was first written for the proceedings of the APFF's annual conference held October 4, 5 and 6, 2000. Bill C-43, mentioned in the text, died on the Order Paper when elections were called December 17, 2000. The content of the bill was reintroduced in the House of Commons on March 21, 2001 by way of Bill C-22.


The harmonization project in the area of federal tax legislation is being pursued as part of a process of legislative revision designed to ensure that civil law and common law are adequately reflected in both language versions. This process is not to be confused with the harmonization of Quebec tax laws with federal fiscal legislation[1], nor with the commodity tax harmonization work[2].

In the fall of 1999, Tax law was identified as one of the key areas requiring harmonization no less than regulatory law and trade law. The Department of Justice Canada, in cooperation with the Department of Finance Canada and the Canada Customs and Revenue Agency, plans, in the next few years, to address the harmonization of tax laws and regulations[3]. The harmonization of fiscal legislation is a practical undertaking, not a Byzantine and academic exercise. Taxpayers, program managers, Canada Customs and Revenue Agency officials, to name but a few, are routinely faced with harmonization problems on a daily basis. Harmonization is designed to ensure effective enforcement of federal fiscal legislation in civil law as well as common law jurisdictions. Considering that fiscal legislation has major patrimonial consequences, it is important to ensure that these laws are correctly understood and applied by all Canadians, whatever the legal system they are governed by.

The first part of this article will deal with certain aspects of harmonization in a fiscal context, or to be more specific, with situations of complementarity and uniformity, whereas the second part will deal with the harmonization work, more specifically the harmonization methodology used, the characterization of problems and the various solutions being considered. The final part of the text will deal with a number of specific harmonization issues raised by the tax community on which the federal government will focus in the coming months.


When Parliament legislates measures in one of its areas of competence in accordance with section 91 C.A. 1867, such as, for example, taxation (91(3) C.A. 1867), it refers on many occasions to private law concepts that come under provincial authority in accordance with subsection 92(13) C.A. 1867. Complementarity is thus achieved between provincial private law and federal legislation. On the other hand, Parliament also has the power, under the constitution, to create any rule of law that does not lie within its competence where such rules are accessory or ancillary to one of its powers provided for in 91 C.A. 1867. The federal legislator typically takes this course so as to ensure consistency on the national level in the application of the law. There is thus dissociation between provincial private law and federal legislation.

For more details regarding the harmonization process, see Me Louise Maguire Wellington's article in issue no. 4.

1.1 The Interpretation Act

S-4 proposes additions to the federal Interpretation Act, mainly the new sections 8.1 and 8.2, which officially enshrine the principle of complementarity of provincial private law:

Mr. Henry Molot's article in issue no. 5 discusses this section of Bill S-4 in greater depth.

In addition to the principle of complementarity, may we mention here and now that these new provisions establish other major interpretation rules, especially in the context of fiscal law. On the one hand, section 8.1 attributes an evolutionary character to private law expressions of the provinces used in federal acts. For example, while the I.T.A. uses the term privilège and makes no reference to the new terminology of the Civil Code of Quebec, the interpreter of the clause will need to update the terminology used in the Act and replace the term privilège by priorité or hypothèque légale as the case may be.

On the other hand, section 8.2 of the Interpretation Act specifies that where a text uses civil law as well as common law terms, the former will be applicable in Quebec and the latter (common law) in the other provinces. Thus, a British Columbia taxpayer who comes across the term "immovable" in the I.T.A., could not assume, based on the dictionary definition, that the legislator has incorporated into it a new concept which might entitle him, among other things, to claim a capital cost allowance or investment tax credit on property located in British Columbia. "Immovable", a civil law term, would apply only to Quebec taxpayers if it were to be used in the I.T.A.[4]

1.2. Certain judgments rendered in fiscal matters involving the concepts of complementarity and uniformity

In the context of the application of Canadian fiscal laws, the courts generally recognize the principle of complementarity of the provincial private law whenever a private law concept is not defined in tax legislation. On the other hand, even where such a private law concept is not defined, a certain line of cases recommends uniform application of federal tax legislation Canada-wide, irrespectively of provincial private law. There is consequently a cleavage between these two major trends, and case law on this issue does not always allow the identification of clear rules.

A brief review of a number of jurisprudential decisions will help identify the issues involved in the process of harmonization of federal tax legislation.

1.2.1 Examples of cases where complementarity between provincial private law and federal fiscal law was recognized

Failing a text to the contrary, it is usually to the fundamental law of the individual provinces that we must turn to interpret a private law concept used in federal statutes. This principle was commented upon in the following terms by professors Jean-Maurice Brisson and André Morel, in the context of fiscal law enforcement:

The most persuasive example of this is undeniably the Income Tax Act (and tax legislation in general). One is even tempted to say that the Income Tax Act is superimposed on juridical acts subject to the civil law in virtually all of its provisions, so that consequences suitably adapted to its purpose may be drawn from those transactions.


It can be concluded, therefore, that the Income Tax Act, a public law statute par excellence, is in principle ineffective without indirectly referring to the civil law. If, for example, the Act were to provide "no special definition of the word ‘sale' or any special meaning […] one must consider that word in the light of the law of the Province of Quebec as applied to the relationship created by the agreement. [Olympia and York Developments Ltd. v. The Queen, [1981] 1 F.C. 691, 697]"[5]

Professors Morel and Brisson further note as follows:

The same is true with respect to the process of compulsory execution of the federal government's tax claims, which necessarily presupposes that one resort indirectly to the Civil Code in determining the respective rights of the parties in seized property.[6]

The principle of complementarity of federal and provincial legislation has often been articulated by Canadian courts. The following excerpt from Justice Décary's decision,[7] dealing with the complementary relationship between fiscal legislation and provincial law is a landmark in judicial history:

In my opinion fiscal law is an accessory system, which applies only to the effects produced by contracts. Once the nature of the contracts is determined by the civil law, the Income Tax Act comes into effect, but only then, to place levy. Application of the Income Tax Act is subject to a civil determination, whether such a determination be according to civil or common law. There is no need, in deciding as to the nature of the contracts, to have recourse to the theory popular in fiscal law of form and substance, if the private law of the place where the contract was concluded, which is the Civil Code in the case at bar, contains provisions the effect of which is comparable to that theory.

The same principle is taken up by Justice Addy of the Federal Court Trial Division in the matter of Olympia and York Developments Ltd. v. R.[8] The court had to determine whether there had been sale of a property and, if not, whether the transactions had resulted in a disposition within the meaning of tax legislation. The Honourable Justice Addy began by noting as follows:

It is evident that the rights of the parties to the contract and all matters governing various agreements and legal relations arising from the actions of the parties to those agreements must be determined in accordance with the law of the Province of Quebec.

The rights of the parties arise out of the agreement filed as Exhibit 1 and full consideration must be given to its terms. Since there is no special definition of the word "sale" or any special meaning to be attached to it in the Income Tax Act, one must consider that word in the light of the law of the Province of Quebec as applied to the relationship created by the agreement (Exhibit 1).[9]

He continues later in the same vein, dismissing the principles of common law that had been submitted to him to define the concept of sale.

It now remains to be considered whether, in the light of these findings, a sale has taken place according to the laws of the Province of Quebec.

I have considered without applying them the following cases: Cornwall v. Henson ((1899) 2 Ch. 710); Trinidad Lake Asphalt Operating Company, Limited v. Commissioners of Income Tax for Trinidad and Tobago ((1945) H. of L. A.C. 1); Buchanan v. Oliver Plumbing & Heating Ltd. ((1959) O.R. (C.A.) 238); together with the passages in 19 C.E.D., Chapter IX and Halsbury's, Third Edition, Volume 34 referred to by counsel. These, of course, constitute exclusively English common law jurisprudence on the subject. The law of real property is one of the areas where common law and civil law principle's are most likely to be at variance or at least to flow from different fundamental premises. At common law, the nature of the relationship existing between a vendor and purchaser of real estate under given circumstances is governed to a large extent by the distinctions between legal and equitable ownerships, estates and remedies and by the principles applicable to various categories of trusts and trustees. None of these concepts even exist in civil law. To seek by way of common law jurisprudence to reach a solution to the present issue would be to venture out on a perilous journey over rocky and tortuous roads, fraught with pitfalls, which would lead to a mere cul-de-sac, if one were fortunate.[10]

The principle of complementarity of provincial private law had already been spelled out in 1960 in Perron v. MNR,[11] a case involving the concept of disposition (before the definition was introduced in the legislation). A review of the jurisprudence and doctrine in support of the complementarity principle, which was then applicable in the matter, is summarized in the following terms by the judge:

In the case of His Majesty the King and Dominion Engineering Company Limited (1944) S.C.R. 371, 376 (2 DTC 674), the Honourable Mr. Justice Rand expressed the following opinion:

…If income tax is a creation of the Act which imposes it, that Act must apply within the framework of the civil laws governing legal relationships between individuals. The tax is grafted, as it were, on the legal tree which covers with its shadow the rights and obligations arising from the contracts. Simon's Income Tax, Vol. 1, p. 48, No. 62, states: "Taxation law does not exist in vacuo. It has regard to situations and transactions the exact force and effect of which are determined and regulated by the general law. It is true that for particular purposes a taxing statute may build on a basis of hypothesis, as in the case of those sections of the Income Tax Act, 1952, which deem income arising under a settlement (as specially defined) to be the income of the settler notwithstanding express provision to the contrary of the governing document. This artificial treatment is, of course, confined by the legislature to the purposes of the Income Tax Act; the general law is otherwise in full force, so that even in the case of these sections it is important in the first place to construe the settlement according to the correct legal principles in order to see whether and in what manner the sections apply."

In other cases, it is vital that the true legal position of the taxpayer in relation to a transaction giving rise to an item of apparent income should be appreciated before any attempt is made to apply the taxing Act to the case.

That opinion reflects the obiter dictum of the Honourable Mr. Justice Williams in Tweddle v. Federal Commission of Tax 7 A.T.D. 186, 190:

It is not suggested that it is the function of income tax Acts or of those who administer them to dictate to taxpayers in what business they shall engage or how to run their business profitably or economically. The Act must operate upon the results of a taxpayer's activities as it finds them.

It should be remembered that the legal relationships of the parties to a contract and the consequences of that contract must be respected by the persons responsible for administering the Income Tax Act. What must be taken into account above all are the real nature of the contracts and their effects on the contracting parties and on third parties, with respect to the general law of the place—common law, or Quebec Civil Law, as the case may be.[12]

The courts have also applied provincial private law in many other tax areas despite the balkanization that such an approach could lead to. Some judgments of the Supreme Court of Canada highlight this tendency. Examples that come to mind are the judgment delivered in Continental Bank Leasing Corporation v. R.[13] where the law of the province of Ontario was applied so as to determine if a partnership had been created. We recall also the decision in Sura v. R.[14] where the Supreme Court applied the provisions of the Civil Code of Lower Canada dealing with the matrimonial regime of community of property in a dispute on income-splitting between the spouses.

Case law also provides many examples of the application of provincial private law in matters involving the transfer of property. In the Federal Court of Appeal case of Brouillette v. R.,[15] dealing with the fiscal impact of the transfer of shares to a minor, the dispute was settled on the basis of the civil law applicable at the time of the transaction. The transfer to a trust created on behalf of the minor was deemed to have been effected on the child's behalf within the meaning of subsection 73(5) of the old I.T.A. The comments of the court on the role of the federal legislator deserve to be underscored:

[Translation] The legislator is deemed to know the existing law. It must have known, in 1987, that at least in Quebec the transfer of property to a minor could be effected via a trust under section 981a. of the Civil Code of Lower Canada. Since subsection 73(5) applied both to minor and major children, the legislator was not required to say that if minor children were concerned, the transfer should be made in accordance with the procedures applicable in the case of a transfer to a minor child. … The legislator wanted to specifically ensure that the transfer for the benefit of a presumably minor child in all provincial jurisdictions is not jeopardized by the differences in form that might exist by virtue of applicable provincial laws.[16]

In the same vein, the judgment of the Federal Court of Appeal in Hillis v. R.[17] applies the law of the province of Saskatchewan to determine if there was irrevocable vesting within the meaning of subsection 70(6) of the I.T.A. As a final comment, we should mention the judgment rendered in the matter of Furfaro-Siconolfi v. R.,[18] where the provisions of the Civil Code of Lower Canada served as a legal basis to rule on the actual time when a transfer takes place between spouses.

1.2.2 Examples of cases where uniformity prevailed

Professors Jean-Maurice Brisson and André Morel appropriately sum up the other trend that derives from fiscal case law:

In opposition to the commonly held view that the complementarity of provincial private law with federal private law legislation is accepted failing any provision to the contrary, it is sometimes suggested that federal legislation should be applied in the same way everywhere, in the interests of uniformity. […] For the same reason it has sometimes been considered appropriate to interpret the Income Tax Act as overriding the civil law, using a common law rationale, to avoid giving the Act a broader scope within Quebec than it would have in some other province.[19]

In the judgment rendered by the Supreme Court of Canada in Vancouver Society of Immigrant and Visible Minority Women v. MNR,[20] the principle of complementarity of provincial private law was entirely discarded in the field of characterization of charitable organizations. Mr. Justice Gonthier expresses himself in no uncertain terms as follows:

It is well-known that the I.T.A. does not define "charity" or "charitable", other than to define "charity" to mean "a charitable organization or charitable foundation", which are themselves defined terms. Instead, as the Federal Court of Appeal stated in Positive Action Against Pornography v. M.N.R., [1988] 2 F.C. 340, at p. 347, "the Act" appears clearly to envisage a resort to the common law for a definition of "charity" in its legal sense as well as for the principles that should guide us in applying that definition.


Parliament has, in effect, incorporated the common law definition of charity into the I.T.A., and in doing so, has implicitly accepted that the courts have a continuing role to rationalize and update that definition to keep it in tune with social and economic developments. I note in passing that the definition of "charity" or "charitable" under the I.T.A. may not accord precisely with the way those terms are understood in the common law provinces, due to judicial decisions and provincial statutory incursions into the common law. The I.T.A.'s conception of charity, by contrast, is uniform federal law across the country.[21]

In another case dealing with donations in the area of tax,[22] the civil law of the province of Quebec had been set aside in favour of the uniform application of federal legislation. The issue was to determine whether the conveyance concluded between a father and his son constituted a donation in respect of the difference between the fair market value and the purchase price. While it is probable that the benefit conferred constituted a donation under Quebec law, the Court decided that no donation was involved within the meaning of the I.T.A., since the Act had to be interpreted uniformly across Canada:

In the present case we are dealing with a taxing statute which must be applied in the same manner throughout Canada and as the former Chief Justice Jackett stated, in dealing with different sections of the Income Tax Act even if the sale at an undervaluation constituted an indirect gift for the purposes of Article 712 of the Quebec Civil Code, this should not be taken to extend the application of Section 111 of the Income Tax Act in a litigation in that case in the Province of Quebec beyond what it would be in another Province.[23]

In Marcoux v. Canada,[24] the plaintiff invoked, against a garnishment made under subsection 224(1) of the I.T.A., exemption from seizure of the supplementary retirement benefits under the Civil Code and the Code of Civil Procedure of the province of Quebec. The court dismissed the submission that civil law was applicable in respect to the procedures initiated under subsection 224(1) in the following terms:

Mais il y a davantage. Les tribunaux ont maintes fois décidé de l'autonomie des lois fiscales, dont la Loi de l'impôt sur le revenu, les qualifiant de « code complet ». Au nom de l'uniformité d'application de cette loi fédérale et de l'égalité des contribuables devant le fisc, j'estime que par les termes du paragraphe 224(1) de la Loi de l'impôt sur le revenu, le législateur fédéral a créé un mécanisme unique qui confère à sa disposition une autonomie véritable par rapport au droit privé.

The same reasons had been invoked by Mr. Justice Denault of the Federal Court in a decision involving the Quebec Ministry of Revenue and dealing with the application and enforcement of the Excise Tax Act:

La Loi sur la taxe d'accise, tout comme la Loi de l'impôt sur le revenu, L.R.C. 1985 (5e supp., ch. 2), contient en effet un code complet de perception des impôts en vertu duquel, après avoir reçu un avis de cotisation, un contribuable peut loger un avis d'opposition et en appeler éventuellement devant la Cour canadienne de l'impôt. Il n'est donc pas du ressort de cette Cour de décider du montant de la cotisation et des dépenses auxquelles un contribuable peut prétendre avoir droit.[25]

It is not only the civil law of the province of Quebec which is set aside in the name of uniformity of enforcement. In the matter of Markevich v. R.[26], the law of British Columbia was discarded:

However, in my view even though the liability of the taxpayer to pay money due under the Income Tax Act is a debt to the Crown, and debt is a common law concept, there is no reason of policy for subjecting its enforceability to provincial law when this will detract from the uniform application of the statute without any justification. Indeed, if the law of British Columbia applies to the debt in question here it would be extinguished altogether.

Moreover, I note that in Vancouver Society of Immigrant and Visible Minority Women v. Canada (Minister of National Revenue) (S.C.C.; January 28, 1999) (since reported, 99 DTC 5034), Gonthier J. said that, even though the Income Tax Act did not define the term "charitable", but left it to the courts to elaborate, the statute's conception of charity is uniform federal law across the country and does not accord precisely with the way these terms are understood in the common law provinces, due to judicial decisions and provincial statutory incursions into the common law.

In my opinion, therefore, the Income Tax Act should be interpreted as creating a federal cause of action in the event that a taxpayer fails to pay tax duly assessed.[27]

The majority decision of the Federal Court of Appeal in the matter of Construction Bérou Inc. v. R.[28] highlights the tensions between the objectives of recognition and uniformity of private law. In this matter, the taxpayer had signed leasing agreements in respect of the financing of trucks. He deemed himself owner of the assets for the purposes of capital cost allowance and investment tax credit since, in his opinion, he had acquired these assets within the meaning of common law. This position was challenged by the Department on the ground that in civil law only the holder of the title-deed may be deemed the owner, so that only the financial lessor could be the owner and thus claim the capital cost allowance and investment tax credit. The appellant argued that the law should apply in a consistent manner and claimed the same tax benefits it would have been entitled to under common law had it been the real owner (beneficial ownership).

The Justices Létourneau and Desjardins interpreted the provisions of the law governing leases in such a way as to ensure a measure of horizontal equity between Quebec taxpayers and those in the common law provinces. To achieve this outcome, the two judges equated the lessee/lessor situation with that of legal/beneficial owner under the common law. Based on the decisions in Olympia and York Developments Ltd.[29] and Wardean Drilling Limited,[30] the Justices adapted these common law principles so as to produce, in civil law, a result similar to that of other Canadian provinces. Mr. Justice Létourneau, in Bérou, explained why under the circumstances the uniformity of fiscal law prevails over compliance with the civil law:

En somme, au terme de ces deux arrêts il y a, en vertu de la Loi, disposition ou acquisition d'un bien aux fins d'allocation du coût en capital lorsque les attributs ou accessoires normaux du titre, tels la possession, l'usage et le risque sont transférés. Je suis d'accord avec cette interprétation légale donnée à des fins fiscales au terme « acquis » que l'on retrouve dans la définition de « biens amortissables ». Sur le plan pratique, cette interprétation a le mérite de reconnaître, pour une législation fiscale d'application pancanadienne, une réalité commerciale transfrontalière et d'éviter de s'enterrer dans un légalisme indu, sectoriel et par surcroît stérile et inéquitable à une époque où le droit civil tend à se rapprocher de la common law. Il est tout de même significatif que le législateur, qui modifie annuellement la Loi pour, entre autres motifs, changer une disposition législative lorsque l'interprétation qui lui a été donnée ne permet pas de rencontrer les objectifs poursuivis, n'ait pas cru bon de répudier cette interprétation vieille de 30 ans. En outre, cette interprétation est conforme à l'intention législative exprimée au paragraphe 248(3) de la Loi, laquelle vise, comme je l'ai déjà mentionné, à assimiler le « beneficial ownership » d'un bien à diverses formes de propriété propres au droit civil du Québec.[31]

Mr. Justice Noël, for his part, has refuted this interpretation. In his dissent, he analyzed the civil law of the province of Quebec and, using it as a basis, was unable, despite the unfairness of the situation for Quebec taxpayers, to conclude that acquisition had taken place.

While the decisions discussed above are fairly recent, the principle of uniformity has been invoked for many years for the purpose of setting aside the private law of the provinces. For example, in 1971, in Rosenstone v. DNR,[32]it was for the sake of horizontal equity and uniform application of tax legislation that emphyteusis was treated as a leasehold tenure (leasehold interest):

To be equitable, an income tax law must apply in general to the entire nation. In the present case it would not be fair because taxpayers in the Province of Quebec would enjoy an advantage that taxpayers in other provinces would not have. I feel it is clear that the legislator intended to include all leases, even emphyteusis, which is a lease by which "the proprietor of an immovable conveys it for a time to another, the lessee subjecting himself to make improvements, to pay the lessor an annual rent, and to such other charges as may be agreed upon" (Civil Code, Article 567).[33]

1.3 Harmonization issues in the area of tax

These few judgments highlight the existence of some tension between the acknowledgement of the peculiarities of private law in the provinces and uniform application of fiscal legislation. In the area of harmonization of tax laws, three objectives are being pursued: uniformity of treatment, respect of the civil law of the province of Quebec and reduction of the caseload of litigation. The harmonization expert will be responsible for finding the golden mean between horizontal equality (same fiscal treatment regardless of the law system applicable) and respect of the two major legal systems, that is, the civil law and the common law:

Our goal is legal duality, not necessarily uniform application of a rule across Canada; it is to be achieved through respect for the nature and uniqueness of the concepts and principles of each legal system. The fact that each of the provincial legislators can adopt legal policies different from those of the other provinces and from those of Parliament provides the key justification of federalism.


In fact, if our goal is uniformity, what would be the use of our federal system and bijural culture? The need to give recognition to diversity should not however downplay the importance of demonstrating coherence and reducing conceptual and linguistic inconsistency.[34]

While it is true that bijuralism and diversity go hand in hand, is it legitimate to believe, and can we extrapolate from the pronouncements of Justice Décary in the Brouillette case, that it is incumbent on the legislator to anticipate and correct, if necessary and through explicit rules, the discrepancies of treatment resulting from the legal regimes of the different provinces? In the absence of specific rules bypassing provincial law and creating a uniform federal law, the law of each of the provinces should thus apply on a suppletive basis to complement federal legislation when it makes reference to private law notions or concepts.

1.4 The process of harmonization of fiscal legislation

On the same basis as most other federal enactments, tax legislation needs to be modernized in such a manner as to integrate the new terminology, new concepts and new institutions of the Civil Code of Quebec. The harmonization process in the area of tax legislation differentiates itself in two respects from that which led to the tabling of Bills C-50, S-22 and S-4. First, with regard to these three bills, it is the Minister of Justice who steered the legislative amendments within the parliamentary process. In fiscal matters, harmonization adjustments will be incorporated in the enactment on the same basis as other amendments to fiscal legislation, and responsibility for the parliamentary process will rest with the Department of Finance. This process has the benefit of being more expeditious, but with, on the other hand, more limited visibility of the harmonization changes.

Bill C-43,[35] tabled in the House of Commons on September 20, 2000, contains the first legislative changes resulting directly from the implementation of the Policy on legislative bijuralism:

  • addition of "liquidator of the succession"/liquidateur de la succession[36] in both language versions;[37]
  • substitution of "joint ownership"/propriété conjointe for "co-ownership"/copropriété[38] in both language versions;[39]
  • addition of "hypothec"[40] in the English-language version.[41]

Bill C-43 also contains amendments to legislative provisions relating to trusts and the definition of "disposition". These amendments refer to the concept of beneficial ownership which has no equivalent in civil law. Why were these provisions not harmonized right away in Bill C-43? It is because they deal with complex notions for which there are no equivalents in civil law. They will be ultimately harmonized, but in-depth research is required before any amendments are proposed. Those harmonization problems for which solutions have been identified will be corrected in due course as new legislative proposals are introduced. These changes are clearly identified in the explanatory notes, as was the case for the harmonization changes made in the Notice of ways-and-means, Motion of June 5, 2000, now Bill C-43.

The second aspect which differentiates the harmonization process in fiscal matters from that which has prevailed for Bills C-50, S-22 and S-4 is that, in the fiscal area, comprehensive review of an Act such as the I.T.A. is not possible because of the significant number of new provisions adopted annually. The approach proposed for fiscal legislation involves reviewing the new legislation starting with budget 2000, with correlative changes to existing statutes being made gradually as scheduled.

1.5 Harmonization methodology of fiscal legislation

The first stage of the harmonization methodology involves identifying points of contact with the private law. We will not outline here the methodology set out by Me Louise Maguire Wellington in her article in issue no 4.

Once the points of contact have been identified, the harmonization expert then proceeds to track cases of complementarity or dissociation. When a complementarity relation is identified, the harmonization expert moves to the next step which is the characterization of the problem. In presence of a relation of dissociation, which occurs when the federal law sets up its own rules of private law, there is no harmonization of the provisions where these concepts are referenced.

Subsequently, the harmonization expert characterizes the harmonization problem and proposes one or more solutions. Finally, recommendations are submitted to the Department of Finance for incorporation in legislative provisions.

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