How Foreign Entrepreneurs Obtain Permanent Residence & Citizenship In Canada
Canada is a great place to do business. According to the World Bank, Canada is ranked 23rd in its ease of doing business index. Canada has a highly-educated workforce and offers one of the lowest corporate tax rates in the world.
It is for these (and many other) reasons that business owners, entrepreneurs, and investors strive to become Canadian citizens. Canada does not have a “golden visa,” “citizenship by investment,” or other similar passive investment programs where you can get Canadian citizenship in exchange for investment. However, there are still many ways for business owners, entrepreneurs and investors to become Canadian citizens by investing in Canadian businesses.
In general, to become a Canadian citizen, you must meet the following requirements:
- Become a permanent resident of Canada;
- Have physically spent 1,095 days (3 years) of the last five years in Canada;
- Have filed your annual income tax returns;
- Pass a basic test on your rights, responsibilities and knowledge of Canada; and
- Prove your basic language skills.
This means that to become a Canadian citizen, you have to become a permanent resident first, which is the hardest part.
Here, we explore some of the available options for business immigrants to relocate to Canada through investment and (ultimately) become Canadian citizens.
There are a few general immigration options available to businessmen, investors, and entrepreneurs to become Canadian permanent residents.
They are done through:
Business Immigration Through Executive Express Entry
Many business owners and investors mistakenly believe that Express Entry is the only option for them to immigrate to Canada. They often start the process by researching their eligibility under the “professional” stream of the Express Entry Program and quickly discover that they may not qualify for this program. The “professional” stream of the Express Entry Program is primarily targeted toward younger professionals (under 35 years old) with strong English or French language skills (CLB7 language or higher), outstanding education credentials (master’s degrees or higher), and often work or study experience in Canada.
Many successful professionals, entrepreneurs and investors over 35 years old often lose their hope of immigrating to Canada when they assess their chances under the “professional” stream of the Express Entry; however, they often forget or are simply unaware of the “executive” stream of the Express Entry program. This is primarily designed to attract senior managers, business owners and entrepreneurs by awarding this category of people an extra 200 CRS points for “arranged employment” in Canada.
The process is relatively straightforward.
Generally speaking, to become eligible to immigrate under the Executive Express Entry program, foreign investors need to go through several steps:
- Establishing a company or buying an existing company in Canada;
- Applying for a work permit;
- Operating their business for some time until it becomes fully operational;
On average, it takes between 12-18 months to go through the steps above, but the ultimate reward is a permanent resident status in Canada together with an immediate family. So, it’s a totally worthy effort. Let’s take a closer look at each step.
Step 1: Buy or establish a business in Canada
There are four ways for foreign investors to invest in Canadian business:
- Starting a business from the beginning;
- Buying an operational business;
- Buying shares in an operational business (at least 33% or more); and
- Buying a franchise.
| Cost || Risk (profit Potential)||Time to Operate Before PR Application ||Difficulty to Operate||Conditions for Permanent Residence Application
|Start A New Business||Low ($50,000+)||High||At least 12 months||Difficult||Active company in Canada; Commercial office; At least 1 Canadian employee; 12 months of operations.|
|Buy A Business||High ($150,000+)||Moderate||No minimum requirement||Moderate||Ownership of 51% of shares; Active company; At least 1 Canadian employee.|
|Buy Shares in a Business||Moderate ($100,000+)||Moderate||No minimum requirement||Simple||Company existed for at least 12 months; Currently active; Company has sufficient funds.|
|Buy a Franchise||Moderate ($100,000+)||Low||No minimum requirement||Simple||Active company; At least 1 Canadian employee.|
There are pros and cons to each approach. Contact us to discuss which option suits you best.
Step 2: Apply for a Work Permit
Once you have created or purchased a Canadian business, you can apply to obtain a work permit as a business immigrant. Several different work permits are available based on your background and immigration goals. They include the following:
- LMIA-based work permits, including Owner-Operator.
- Service Canada announced that they are entirely revising the Owner-Operator LMIA program; learn more in our article detailing the cancellation, and contact us to learn more about your options in Canada.
- Intra-company transferees (“ICTs”).
- Investors under free-trade agreements. This is specifically for citizens of Mexico, Chile, Colombia, the USA, the EU, South Korea, Panama, Peru, Vietnam, Australia, New Zealand, Japan, and Singapore.
- Work permits for entrepreneurs and self-employed candidates (C11).
Step 3: Operate a Business
Upon arriving in Canada as a foreign worker, you will need to operate your business for a specific period before you can transition to permanent residence. The length of operation depends on the type of business you have (i.e. established or new) and your work permit type.
In general, your business must be “active” before you can apply for permanent residence, which means it has the following features:
- Is actively selling goods or services to actual and existing customers;
- Has all licenses and permits necessary to operate in Canada;
- Has a physical location within Canada; and,
- Has at least one Canadian employee apart from you and who is not related to you.
Step 4: Apply for Permanent Residence in Canada
Once your Canadian business is active, as explained above, you can apply for permanent Canadian residency as the manager of your business. That said, you will need to meet certain criteria, which include the following:
- A score of at least CLB 7 for your language skills;
- At a minimum of a high-school education;
- A police clearance; and,
- No serious medical issues.
Pros: In terms of advantages, one key benefit centers on the lack of an upfront, minimum investment. While you should set aside an amount that makes sense for your specific industry or operation, we recommend $100,000 to cover your initial costs of operating your business in Canada. Another significant advantage is that this first option grants a fast route to permanent residence (with an average of between 12-18 months).
Cons: Unfortunately, this option contains a high language requirement, which is something to keep in mind if your language skills aren’t up-to-par. For instance, you’ll need to obtain an IELTS General 6 for each band.
Business Immigration through Provincial Nominee Programs
This second category differs slightly because business immigrants apply directly to a provincial nominee program (“PNP”). This application process allows these immigrants to potentially obtain permanent residency and, eventually, Canadian citizenship.
While the processes vary by province, most provinces have adopted the following process:
You’ll start by registering an expression of interest with your preferred province. After receiving an application invitation, you’ll apply and (hopefully) pass the interview. Upon signing a performance agreement with the province, you’ll apply for a Canadian work permit. Once you arrive in Canada as a foreign worker, you’ll establish your company and operate your business according to the performance agreement you signed. Finally, you’ll apply for nomination and, subsequently, for permanent residence.
Again, this is just a general procedure. You’ll want to confirm the exact process with your preferred province.
Below are the PNPs for business immigrants to Canada:
- Provincial Nominee Program (“BC PNP”) — Entrepreneur Immigration Stream.
- Provincial Nominee Program (“BC PNP”) — Entrepreneur Immigration — Regional Pilot.
- Provincial Nominee Program — Business Investor Stream (Entrepreneur Pathway).
- Provincial Nominee Program — Business Investor Stream (Farm Investor Pathway).
- Provincial Nominee Program (“NBPNP”) — Entrepreneurial Stream.
- Provincial Nominee Program (“NBPNP”) — Post-Graduate Entrepreneurial Stream.
- Nominee Program (“NSNP”) — Entrepreneur Stream.
- Nominee Program (“NSNP”) — International Graduate Entrepreneur Stream.
- Immigrant Nominee Program (“OINP”) — Corporate Stream.
- Immigrant Nominee Program (“OINP”) — Entrepreneur Stream.
Prince Edward Island:
- Immigrant Nominee Program (“SINP”) — Entrepreneur Category.
- Immigrant Nominee Program (“SINP”) — Farm Owner/Operator Category.
Pros: In terms of advantages, PNPs attract many business immigrants due to their very low language skill requirements. For example, Ontario, Prince Edward Island and Saskatchewan accept applications from business immigrants with language skills CLB 4.
Cons: Conversely, PNPs require higher initial investments (e.g. $150,000 and up), minimum net worth requirements and take longer to obtain permanent residence (with an average of between 24-36 months).
Business Immigration as a Start-Up Company
The Start-up Visa Program provides permanent residence to immigrant entrepreneurs and helps them become established in Canada. The program’s goal is to attract immigrant entrepreneurs and help them create long-lasting businesses that will employ Canadians and drive economic growth.
The Start-up Program is attractive because it does not require a minimum initial investment, there is no net worth requirement, and the applicants can choose to live anywhere in Canada. Additionally, if the business fails, it doesn’t affect your permanent resident status.
Successful applicants for the Start-up Visa program must meet the following conditions:
- Obtain a Letter of Support from at least one Canadian-designated organization;
- Meet the minimum language requirement of CLB5 in either English or French;
- Possess sufficient funds to settle in Canada (e.g. roughly $10,000 USD for a single person + $2,500 USD per family member);
- Reside in a province other than Quebec; and,
- Pass Canadian security and medical clearances.
Canadian-designated organizations are business groups that have been chosen by the Immigration, Refugees and Citizenship Canada (“IRCC”) department to support start-ups through the Start-up Visa Program. Each organization independently decides which business proposal to review and has its criteria for assessing it. If an organization decides to review your business idea, it’ll assess the potential of your proposed business idea and hypothesize whether or not it’ll succeed. If an organization chooses to support your proposal, it’ll give you a Letter of Support which you can use to apply for a work permit and permanent residence in Canada.
The process for applying to the Start-up Visa Program differs depending upon the designated organization’s intake and review procedures but generally looks like this:
- Pitch deck and business plan
- Establishing a company in Canada
- Going to market
- Pitching to Designated Organizations
- Immigration Application
We are business and legal professionals and, along with our reputable partner network, can assist you with each step of the Start-up Visa Program.
Contact Us Today
As you can see, entrepreneurs, business owners, and investors have several different paths to becoming Canadian citizens; however, the vast number does not mean that the process is easy. It requires hard work and a well-thought-out strategy to maximize your odds of success. Our lawyers will be glad to discuss business immigration options with you. Book an appointment with an experienced immigration lawyer today.
At Sobirovs Law Firm, we can help you develop a strategy and jump through all hoops to become a Canadian citizen. Learn more about our services and how we can provide value to you here. We look forward to hearing from you!