Canada News Article – December 2004

Canada is committed to welcoming true entrepreneurs. As such, they must demonstrate that have an entrepreneurial and business background, a certain net worth as well as the drive to establish business in Canada and create employment for Canadian citizens and / or permanent residents.

This article will focus on the Federal requirements. There are also opportunities for entrepreneurs in specific provinces, such as Quebec, British Columbia and Nova Scotia. The selection criteria may vary from those mentioned above. In these cases, the province has sole responsibility for selection.

To be eligible under the Federal Program, the entrepreneur must show that, for at least two years within the previous 5-year period (from the date of their application), they can satisfy and document of any two of the following:

  • Percentage of equity x full-time employees is at least 2 full-time employees
  • Percentage of equity x total annual sales is at least CAN $500,000
  • Percentage of equity x net income is at least CAN $50,000
  • Percentage of equity x net assets is at least CAN $125,000

Of these criteria, the first two are self-explanatory. For clarification, “Net assets” means the assets of the business minus the liabilities of the business. You can also add shareholder loans made to the business by the applicant and their spouse / common law partner. “Net Income” is the after tax profit or loss of the business plus remuneration by the business to the applicant and their spouse / common law partner.

Business experience can consist of experience in various businesses so long as each of the years of experience is obtained in periods of at least one year in each business. By requiring a minimum of two years of experience in the definition, it refers to two periods of twelve consecutive months. Therefore, experience gained concurrently in different businesses, in one period of twelve months, will only count as one year of experience.

Also be aware that the same criteria for the two qualifying years do not need to be same. For example, in the first qualifying year, you must meet the requirements for the number of total annual sales and net income. In the second qualifying year, you meet the requirements for the number of employees and net assets. This situation is admissible as you must meet the requirements during the year under consideration, as each year is assessed independently.

Moreover, the definition of “Qualifying business” confirms that each of the one year periods of experience, claimed under business experience, will be independently assessed against the four criteria mentioned above.

The entrepreneur must have a net worth of at least CAN $300,000.00 which must be legally acquired and documented.

The applicant will also have to pass a points test, where points are allocated based on business experience, age, education, language, and adaptability. The current passmark is 35 points.

Entrepreneur conditions

The successful entrepreneur will be issued with a conditional visa for three years. During these three years, the entrepreneur must satisfy the following for one of the following three years.

They are required to control a percentage of the equity of a qualifying Canadian business greater than, or equal to, 33.3 %. They must also provide active and ongoing management of the qualifying Canadian business as well as create at least one incremental full-time job equivalent for Canadian citizens and / or permanent residents, other than the entrepreneur and their family members. The employment must be in the qualifying Canadian business.

The entrepreneur must meet two of the four criteria. These are the same criteria as above, but the dollar figures are less. They are as follows:

  • ┬áPercentage of equity x full-time employees is at least 2 full-time employees
  • Percentage of equity x total annual sales is at least CAN $250,000
  • Percentage of equity x net income is at least CAN $25,000
  • Percentage of equity x net assets is at least CAN $125,000

Applications made under this category are all very unique and require specific and detailed attention and preparation. This includes a fact find / research trip as well as a detailed business plan. The entrepreneur must demonstrate to Citizenship and Immigration Canada that they have a viable business proposal and that they will be able to establish themselves economically in Canada as well as create employment for Canadians and / or permanent residents. The visa officer will need to assess all of these factors based on the paper application submitted to them.

In addition, it is critical that the entrepreneur is aware of the criteria they must satisfy upon arrival in Canada so that they can have their conditions removed and acquire their permanent residence in Canada.

Dennis Brazolot is a Member in Good Standing with the Association of Immigration Counsel of CANADA (AICC) and can be contacted on +1 450 458 2186 or dennis@brazolotimmigration.com He travels regularly to the UK to meet with clients. www.BrazolotImmigration.com