In Morguard Corporation v. The Queen, the Federal Court of Appeal (FCA) upheld a Tax Court decision that a “break fee” received by a parent company (in a corporate group) in the course of its attempted acquisition of a target company was ordinary business income to the parent. The FCA relied on the decision in Ikea Ltd. v. The Queen, which held that a receipt was ordinary business income because it was linked to company’s business operations – and this result did not change even though the amount was received in the course of negotiations to acquire a capital property in that business. In Morguard, the FCA further held “there is no rule of law” that acquiring income-producing assets (shares) can never be a business. Indeed, this statement is consistent with long-standing jurisprudence to the effect that there is very little a corporation might do that will not comprise the carrying on of a business (Weaver v. Canada, 2008 FCA 238, at paragraph 19). Morguard applied for leave to appeal to the Supreme Court of Canada (SCC), in part on the ground that a parent company’s acquisition of shares as a long-term investment cannot itself constitute a business (Leave Application, paragraph 4). In support of this latter statement, Morguard cited Neonex v. The Queen and “the view of most tax practitioners’ understanding of the Canadian tax system” (Leave Application, paragraphs 24 and 27). On April 25, 2013, the SCC dismissed Morguard’s leave application. This leaves open questions for a parent company in this and other contexts. Is the parent company carrying on a business with respect to its shares in one or more subsidiaries? What is the character of receipts and expenditures of the parent company in the course of its activities?