TC Energy - 40-F annual report 2016

Washington, D.C. 20549

Canada

4922, 4923, 4924, 5172

Not Applicable

TransCanada Tower, 450 - 1 Street S.W.

Calgary, Alberta, Canada, T2P 5H1

(403) 920-2000

TransCanada PipeLine USA Ltd., 700 Louisiana Street, Suite 700

Houston, Texas, 77002-2700; (832) 320-5201

Securities registered or to be registered pursuant to Section 12(b) of the Act:

For annual reports, indicate by check mark the information filed with this Form:

Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report.

At December 31, 2016, 863,759,075 common shares;

9,498,423 Cumulative Redeemable First Preferred Shares, Series 1;

12,501,577 Cumulative Redeemable First Preferred Shares, Series 2;

8,533,405 Cumulative Redeemable First Preferred Shares, Series 3;

5,466,595 Cumulative Redeemable First Preferred Shares, Series 4;

12,714,261 Cumulative Redeemable First Preferred Shares, Series 5;

1,285,739 Cumulative Redeemable First Preferred Shares Series 6;

24,000,000 Cumulative Redeemable First Preferred Shares Series 7;

18,000,000 Cumulative Redeemable First Preferred Shares Series 9;

10,000,000 Cumulative Redeemable First Preferred Shares, Series 11;

20,000,000 Cumulative Redeemable First Preferred Shares, Series 13; and

40,000,000 Cumulative Redeemable First Preferred Shares, Series 15

were issued and outstanding.

AUDITED CONSOLIDATED ANNUAL FINANCIAL STATEMENTS AND

MANAGEMENT'S DISCUSSION & ANALYSIS

A.    Audited Annual Financial Statements

For audited consolidated financial statements, including the auditors' report, see pages 119 through 194 of the TransCanada Corporation 2016 Management's discussion and analysis and audited consolidated financial statements to shareholders included herein.

B.    Management's Discussion and Analysis

For management's discussion and analysis, see pages 5 through 118 of the TransCanada Corporation 2016 Management's discussion and analysis and audited consolidated financial statements to shareholders included herein under the heading "Management's discussion and analysis".

C.    Management's Report on Internal Control Over Financial Reporting

For management's report on internal control over financial reporting, see "Management's report on Internal Control over Financial Reporting" that accompanies the audited consolidated financial statements on page 119 of the TransCanada Corporation 2016 Management's discussion and analysis and audited consolidated financial statements to shareholders included herein.

UNDERTAKING

The Registrant undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the Commission staff, and to furnish promptly, when requested to do so by the Commission staff, information relating to: the securities registered pursuant to Form 40-F; the securities in relation to which the obligation to file an annual report on Form 40-F arises; or transactions in said securities.

For information on disclosure controls and procedures and management's annual report on internal control over financial reporting, see "Other information - Controls and Procedures" in Management's discussion and analysis on page 99 of the TransCanada Corporation 2016 Management's discussion and analysis and audited consolidated financial statements to shareholders.

The Registrant's board of directors has determined that it has at least one audit committee financial expert serving on its audit committee. Mr. Siim A. Vanaselja, Mr. Kevin E. Benson and Mr. John E. Lowe have been designated audit committee financial experts and are independent, as that term is defined by the New York Stock Exchange's listing standards applicable to the Registrant. The Commission has indicated that the designation of Mr. Vanaselja, Mr. Benson and Mr. Lowe as audit committee financial experts does not make Mr. Vanaselja, Mr. Benson or Mr. Lowe "experts" for any purpose, impose any duties, obligations or liability on Mr. Vanaselja, Mr. Benson or Mr. Lowe that are greater than those imposed on members of the Audit committee and Board of Directors who do not carry this designation or affect the duties, obligations or liability of any other member of the Audit committee.

CODE OF ETHICS

The Registrant has adopted a code of business ethics ("Code") for its directors, officers, employees and contractors. In 2016, the Code was amended to include new rules concerning the avoidance of conflicts of interest, maintaining a harassment, violence and weapons-free workplace and glossary to provide additional clarity thereto. Effective July 1, 2016, TransCanada acquired Columbia Pipeline Group, Inc. (Columbia). Columbia's code of business ethics and compliance program was assessed and determined to be essentially equivalent to TransCanada's Code. Columbia employees will transition to compliance with TransCanada's Code during 2017. The Registrant's Code was filed with the Commission as part of a Form 6-K report on November 8, 2016 and is incorporated herein by reference and available on its website at www.transcanada.com. No waivers have been granted from any provision of the Code during the 2016 fiscal year.

For information on principal accountant fees and services, see "Audit committee - Pre-approval Policies and Procedures" and "Audit committee - External Auditor Service Fees" on page 37 of the TransCanada Corporation Annual information form.

The Registrant has no off-balance sheet arrangements, as defined in this Form, other than the guarantees and commitments described in Note 27 of the Notes to the audited consolidated financial statements attached to this Form 40-F and incorporated herein by reference.

For information on tabular disclosure of contractual obligations, see "Contractual obligations" in Management's discussion and analysis on page 88 of the TransCanada Corporation 2016 Management's discussion and analysis and audited consolidated financial statements to shareholders.

The Registrant has a separately-designated standing Audit committee. The members of the Audit committee as of February 15, 2017 (unless otherwise indicated) are:

We disclose forward-looking information to help current and potential investors understand management's assessment of our future plans and financial outlook, and our future prospects overall.

Forward-looking statements in this document include information about the following, among other things:

Our forward-looking information is based on the following key assumptions, and subject to the following risks and uncertainties:

Assumptions

Risks and uncertainties

As actual results could vary significantly from the forward-looking information, you should not put undue reliance on forward-looking information and should not use future-oriented information or financial outlooks for anything other than their intended purpose. We do not update our forward-looking statements due to new information or future events, unless we are required to by law.