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Canadian Treaty Investor Work Permit

work permit

Analogous to the E-2 visa in the US context, Canada also offers a pathway for investors to obtain work permits to allow them to invest in and direct an enterprise in Canada.

The treaty investor work permit option is available for citizens of a number of countries that have signed a free trade agreement with Canada. As of the time of writing, this includes all European Union Countries, Mexico, Australia, Japan, Mexico, Peru, Vietnam, Chile, Peru, Colombia, South Korea, UK. Permanent residents of Australia, Colombia, and Peru are also eligible.

Eligibility for a Treaty Investor Work Permit

To be eligible for a treaty investor work permit in Canada, the following requirements apply:

  • The applicant is a national of a treaty country (or permanent resident, in the case of Australia, Colombia, and Peru);
  • The enterprise is majority-owned by nationals of the treaty country;
  • Applicant is coming to Canada solely to “develop and direct” the enterprise, usually evidenced by applicant’s controlling (exceeding 50%) interest in the enterprise;
  • Applicant has invested a “substantial amount” of capital in the enterprise;
  • The business must be real and operating;
  • The business must not be marginal.

How much investment is considered “substantial”?

For determining substantiality, the government will only consider funds “already invested or irrevocably committed” for investment. To determine what is substantial, a proportionality test will be used, which means that the required investment amount will differ on the nature of the business.  For example, the government cites an example of a consulting firm, where an investment of $50,000 may be sufficient to get the business to a fully operational point. In this case the applicant should have invested a high percentage of that $50,000. In contrast, to establish a business that will cost $1 million to set up, the applicant would be considered to have made a “substantial” investment if they have put $500,000-$600,000 into the project.

What does it mean that a business is “real and operating” and not “marginal?”

To be eligible for the work permit, a business must actively provide a service or commodity for profit, and cannot be a passive, speculative investment (e.g., passive investment in real estate properties or stocks held for appreciation). The business must also produce more than a “marginal” income. This means the business should be generating more profits than providing a living for the applicant and their family. To overcome this, the applicant may show how the investment would create jobs locally in Canada, or that the applicant already has substantial income from other sources and will not rely on the enterprise to earn a living.

How long is a treaty investor work permit issued for?

A work permit is initially issued for a maximum duration of one year, with an ability to extend for two years at a time. The applicant is required to only work for the business he or she applied for, and cannot maintain status if they take another job or close down the business. An applicant’s statement of their definite intention to return to their home country after the business is over is usually accepted as sufficient evidence of temporary (non-immigrant) intent.

How can one apply for a Treaty Investor work permit?

In most cases the application should be submitted at a visa office abroad. If the applicant is already within Canada on a temporary resident visa (TRV), it is also possible to apply for this work permit from within Canada.

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