Canada is on the way to becoming a hot spot for start-up business ideas with its Start-up Visa Program that allows qualified immigrant entrepreneurs to establish business in and immigrate to Canada. The government of Canada is seeking applicants with innovative business ideas and ventures. Those who apply a good chance of receiving permanent resident status. Although the program started as a three-year pilot project, it was made permanent on March 31, 2018. The program has been enticing entrepreneurs with an idea of establishing an innovative business in Canada to start their company in Canada and in doing so, offers them permanent resident status. Entrepreneurs who get support for their idea from one of the designated organizations prescribed by Immigration, Refugees and Citizenship Canada (IRCC), may be eligible to achieve Canadian permanent residence.
One of the objectives of Canada’s Start-up Visa Program is to hook up qualified immigrant entrepreneurs with the Canadian private sector businesses -Angel investor groups, Venture capital funds or Business incubators – to help the setup of their initiative in Canada. If the designated organization approves investment in or support of a Start-up, the entrepreneur will receive a letter of support from the relevant designated organization. Along with this letter of support, the designated organization will send a commitment certificate to the immigration office. Therefore, reaching a compromise with the designated organization to support the start-up business idea or venture plays an essential role in the assessment of start-up applications.
The Start-up Visa Program is not available for those applicants who intend to incorporate its business in the Province of Quebec as it has its own business immigration program.
Who can be Eligible for the Start-up Visa Program?
In order to be eligible to apply for the Start-up Visa Program, Applicants must meet four major requirements:
(i) Have a qualifying business
First of all, entrepreneur applicants must create a ‘qualifying’ business that is incorporated to carry on business in Canada, in which each applicant holds at least 10% of the voting rights. Applicants and the designated organization jointly hold more than 50% of the total voting rights in the corporation. In other words, the applicants and designated organization should show a certain degree of controlling interests in the corporation. It is also noteworthy that up to five people can apply as owners with the same corporation and be supported by the same designated organization for their permanent residence application.
(ii) Get a letter of support from a designated organization
Before applying to the Start-up Visa Program, Entrepreneur Applicants must get a designated organization to support and invest in their business and show this support in the form of a Commitment Certificate and Letter of Support.
There are three types of designated entities: (i) Angel investor groups, (ii) Venture capital funds and (iii) Business incubators. In order to have such commitment, the Applicants have to reach out to a designated organization and convince them that they have a viable business idea. Depending on each organization’s own requirements and intake process, Applicants may be asked to pitch their business idea or submit a detailed business plan. After a review of the potential of the business proposal, the organization would assess the likelihood of success for the proposed business. Upon a positive assessment in favour of the proposed business idea, the Applicants would reach an agreement with the designated organization that will issue a Letter of Support as proof of the organization’s support of their business idea.
The designated organization would also send a Commitment Certificate directly to the immigration office to support the Applicant’s immigration process. The minimum investment amount differs for each designated organization. If the investment comes from a designated Angel investor group, one or more of these groups must commit to invest a minimum of $75,000 CAD into the qualifying business. For Venture capitals funds, the amount of investment into the qualifying business must be a minimum of $200,000 CAD. No minimum financial investment is required if the qualifying business is supported by a designated business incubator, but the entrepreneur applicants must be accepted into a Business incubator program.
(iii) Meet the language requirements
The applicants must meet the minimum level of the Canadian Language Benchmark (CLB) 5 in one of the official languages English or French in all skills, including speaking, reading, listening, writing.
(iv) Bring enough money to settle
The applicants must prove that they have enough funds to support themselves and any of their dependants to settle down in Canada. The amount of funds required depends on the number of family members that will be accompanying the applicant to Canada and it is annually updated. For 2020, the required funds amount is CAD $12,960 for a single applicant and it adds up to CAD $3,492 for each additional family member.
Work in Canada during Application Process
An Entrepreneur Applicant that meets all requirements then applies for permanent residence in Canada. The application process will take approximately 12 to 16 months. It is not possible to fast-track the application process for permanent residence. However, while the application for permanent residence is being processed, Applicants can apply for a short-term work permit to come to Canada and start building their business if they meet the eligibility requirements for short-term work permit.
In order to be eligible for a short-term work permit, Applicants must first plan to reside in Canada and pay the employer compliance fee. The Applicants must have also received a Letter of Support and Commitment Certificate from a designated organization indicating that they are an essential person in the business and that there are urgent business reasons for their early entry to Canada. Lastly, Applicants must have sufficient funds to meet the low-income cut-off (LICO) for their family for 52 weeks.
Approval of Permanent Residence
The last step in the Start-up Visa Program is the approval of the permanent residence application. In order to receive permanent residence through the Start-up Visa Program, applicants must be actively involved in the management of the corporation incorporated under the Business Corporation Acts in Canada. In addition to this condition, the essential part of the business operations of the corporation should take place in Canada.
For those interested in starting a business, this is a great pathway to permanent residence status in Canada for you and your family and business partners.
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