Starting Your Business in Canada

By Sean G McKinsley, BA, RCIC, Managing Director, Canada Immigration and Visa Services (CIVS)

Coming to Canada under the Owner Operator Pathway is 2-Staged Program

The Temporary Foreign Worker (TFW) program is a suitable vehicle to facilitate the admission to Canada of a foreign owner, following the sale of a Canadian business or the launch of a new entity.

For foreign investors, this pathway to Canada is 2-staged, beginning with a temporary work permit under the federal Owner-Operator rules.  These policies will apply for the sale and transfer of a significant portion of ownership in a Canadian business to a foreign national.  Once admitted on a work permit, successful candidates can at a later stage, apply for permanent residence to Canada under one of the programs serviced by the Express Entry system or under a suitable provincial business immigration stream.

Labour Market Impact Assessment (LMIA) Exemption – Entrepreneur and Self-Employed as Business Owner Operator

For most applicants, if you want to apply for a work permit or business in Canada, you need a Labour Market Impact Assessment (LMIA) from Employment and Social Development Canada (ESDC) and a job offer letter from your future employer.  This usually requires advertising an employment opportunity a month in advance offering the employment opportunity firstly to Canadians, First Nations or Permanent Residents. However, under the Owner-Operator pathway an individual has an exemption or “variation” from this advertising requirement to offer the position to someone else first.

Purchasing an Existing Business

This LMIA exemption or variation is available for business owners who  are eligible for an LMIA exemption if they own a controlling share in a business and cannot be fired from their employment.

A “controlling share” is defined as the person who is a sole proprietor, or the only voting shareholder, or who is shareholder with a minimum of 50.1% of the shares. The Owner-Operator must also be involved in the daily business activities and concurrently have an employment relationship with the company. That is to say, the Owner-Operator as an employee cannot be dismissed because s/he is the majority or 100% owner of his/her own company.   This is not a passive (non-active) investment pathway.  Thus the Owner-Operator who manages the day-to-day business of the employer company.

For Start Ups / Create a New Business

The Owner Operator LMIA exemption or variation requires the employer to have been “actively engaged” in the business prior to applying for a work permit under this pathway.

For start ups (a new company) a future Owner-Operator needs to demonstrate that s/he is an active participant through preparatory activity, which could be proof of:

  1. A financial investment in a business;
  2. Negotiating business contracts (for instance, signing a lease agreement);
  3. Establishing / applying for a Business Number (BN) registration with the Canada Revenue Agency (CRA);
  4. Applying for and receiving Licenses or Permits; and
  5. Presenting a well thought out and detailed Business Plan.

To Recap – The Owner Operator LMIA Pathway to Working in Canada is open to

  1. An Entrepreneur and or self-employed individual;
  2. Majority owner (not less than 50.1%) and cannot be dismissed from management of the enterprise;
  • Employs or will employ at least one Canadian, First Nations or Permanent Resident; and
  1. Will operate a business in Canada that contributes a significant social, cultural or economic benefit or a work opportunities for Canadian citizens, First Nations or Permanent Residents in Canada.

Are you an existing business owner looking to take your business to the next level?

Canada Immigration and Visa Services (CIVS) assists qualified individuals in making their dream come true in coming to Canada as a business Owner-Operator.

We are a turn-key service provider.  We look for the most appropriate area in the country to fit your specific business needs. We look for your target market and position you there, in the middle of all traffic. We strive to offer you the best services at best turnaround time in the market.

Contact us for a free evaluation and consultation about your potential to come to Canada as a business Owner Operator.

Here is our Process:

  1. We start by getting to know you and your business idea. We provide you with a free initial consultation;
  2. We work with you to consider options for the start-up or purchase of a business in the region of Canada you choose;
  3. We do our research and make sure that your needs on a personal, social family and economic basis are taken care of in our planning with you;
  4. Your business will be prepared from start to end. We have relationships with bankers, accountants and other professionals that may even assist you in applying for Canadian bank loans and other forms of business financing;
  5. After coming to Canada, you and your family will be eligible for healthcare and your children can attend school; and
  6. You may find yourself to be fortunate compared with other newcomers to Canada because you are coming prepared for resettlement in Canada with a business and the tools you and your family need to be successful.

At Canada Immigration and Visa Services (CIVS) we are proud to offer our clients assistance to:

  • Establish a subsidiary of a foreign company in Canada
  • Establish a new company in Canada
  • Purchase an existing business in Canada
  • Obtaining visas and permits for the business owners, managers, employees and family members in Canada

About the author:  Prior to establishing Canada Immigration and Visa Services (CIVS), Mr. McKinsley served as the senior legislative aide for two prominent Members of the House of Commons of Canada.  Mr. McKinsley also has a distinguished career in the public and private sectors having held positions of Chief Operating Officer of a Western Canadian Law Firm and past Executive Director of a provincial Taxpayer Association.

After Labour Market Impact Assessment is submitted:

After Employment and Social Development Canada (ESDC) receives a Labour Market Impact Assessment (LMIA) from a Canadian employer, they begin their assessment of the application. This will eventually result in either a positive or negative LMIA. If positive, then the Temporary Foreign Worker’s (TFW) work permit application will be assessed. There is also the potential for an LMIA to be revoked later upon reassessment.

This article will be divided into the following 4 main sections: Assessment Process, Positive or Negative LMIA, Work Permit, and Revocation of an LMIA.

LMIA Assessment Process

Every LMIA application goes through the same assessment process once it is received by Employment and Social Development Canada (ESDC). The steps of this process are detailed below:

  • Verify Employer’s Eligibility
    • First and foremost, ESDC will start by ensuring that the Canadian employer submitting the LMIA application is in fact eligible to apply. ESDC is in a constant process of investigating employers and keeps an updated list on their website of ineligible employers or employers who have had their LMIA revoked.
  • Verify Job Consistency
    • The job on offer must comply with relevant federal, provincial, and territorial agreements.
  • Assess Genuineness
    • At this stage, ESDC investigates whether the job offer on the LMIA application is genuine. There are a number of questions asked here, including:
      • Can the employer fulfill the terms and conditions of the job offer? (For example, the job offered should match the employment needs of the employer. The job should not have been created simply to match the criteria on the National Occupational Classification)
  • Assess Language Requirements
    • Next, ESDC will investigate which languages are required to do the job on offer. This will usually be English or French, but an employer can provide proof that another language is required for the job if necessary.
  • Assess Impact on the Canadian Labour Market
    • When a Temporary Foreign Worker is hired, the ESDC needs to consider the effect this will have on the overall labour market in Canada. For this stage, the following factors might be considered:
      • Benefit to the labour market (For example, might hiring the TFW help to create jobs for Canadians later or stimulate economic growth?)
      • Wages and working conditions offered
      • Effect on the settlement of a labour dispute (Is the TFW being hired to replace previous workers who refuse to work due to contract disputes or unpaid benefits?)
  • Assess Previous Job Offers from Employer
    • If the employer has made previous job offers to Temporary Foreign Workers, ESDC will verify that the new job offer is similar to the previous offers. The previous and new job offers will be compared using criteria such as wages and working conditions. The idea here is that the wages and working conditions should similar or better than the previous job offers.

Positive or Negative LMIA

Once Employment and Social Development Canada has assessed the LMIA application through the steps detailed above, then a final decision will be provided to the employer in writing. Naturally, if all of the program requirements are not met, the employer will be issued a negative LMIA and will be unable to hire the Temporary Foreign Worker(s).

If the employer receives a positive LMIA from ESDC, then the LMIA will be valid for 6 months from its issue date. This positive LMIA will contain details about the job offer including wages and working conditions. It will also have a system file number.

After the employer receives the positive LMIA, they should send a copy of the letter to the Temporary Foreign Workers that were included on the application. The employer should not send the Annex B section of the letter (containing the names of the TFWs) as this only for the employer’s records.

At this point, the Temporary Foreign Workers who receive the positive LMIA letter should take steps to apply for a work permit from Immigration Refugees and Citizenship Canada (IRCC). When applying for the work permit, the worker should include a copy of the positive LMIA letter with the application. The LMIA letter must be signed by both the employer and the worker.

Canadian Work Permit

Immigration Refugees and Citizenship Canada (IRCC) will assess the Temporary Foreign Worker’s work permit application. If the work permit is granted, the TFW will receive a work permit with specific details including:

  • Duration of work permit
  • Specific employer
  • Working conditions

After the Temporary Foreign Worker arrives in Canada, the employer must make sure that the worker is legal to work. The employer must ensure that the work permit issued has not yet expired and that they are listed as the authorized employer. Furthermore, the employer must maintain weekly or monthly records of the hours the TFW has worked (including overtime). What constitutes overtime hours may differ depending on the Canadian province where the worker is employed. For example, currently in Ontario, overtime is defined as any work over 44 hours per week.

LMIA Work Permit Renewal

If an employer wishes to retain a Temporary Foreign Worker for a longer period of time, then a new LMIA application must be submitted to ESDC at between 6 to 4 months before the worker’s work permit expires. It is important to start the LMIA application process so that everything is complete (advertising, recruitment, etc.) at least 4 months before the end of the Temporary Foreign Worker’s work permit.