RVXOT:

"If the FMV increases each year, one could have to pay the tax on any increase during that year if CRA claimed that one would not have owned the shares had they not over-contributed."

What you posted would apply to capital gain from the TFSA overcontributed amount. Is this your point of view? But to pay tax on gains an annual basis whether the stock is sold or not is insane, especially since you cannot claim a capital loss in subsequent years should that situation arises.

Koo