The Corporate Immigration Review: Canada
Introduction to the immigration framework
i Legislation and policy
Canada's immigration policies are grounded in federal legislation, specifically the Immigration and Refugee Protection Act (IRPA). Its associated Regulations, the Immigration and Refugee Protection Regulations (IRPR), outline how to apply the provisions of the IRPA. The IRPA was introduced in 2002, and replaced the Immigration Act, 1976. The primary objectives of the IRPA are to facilitate economic immigration and family reunification, and to fulfil Canada's obligations toward refugee protection.
The IRPA is primarily administered by the Minister of Citizenship and Immigration. The IRPA allows for the Minister to issue binding ministerial instructions that direct immigration policy without the need for Parliamentary review or legislative amendment. To date, these ministerial instructions have been used for such purposes as establishing permanent residence pilot programmes, regulating the processing of temporary residence applications and managing application intake.
Operational manuals and instructions, and programme delivery updates, play a critical role in establishing immigration policy and are meant to provide guidance to delegated immigration authorities. They outline various temporary public policies and programme requirements and are subject to frequent change as they can be quickly released and amended as required. In practice, they are heavily relied upon by immigration authorities in their decision making.
With the onset of the covid-19 pandemic, we have also seen the use of emergency orders in council, which is a legislative tool rarely used in the immigration context. Orders in council are recommendations from Federal Cabinet and are not subject to Parliamentary review before they are implemented. Currently, three orders in council govern the temporary travel prohibitions and the quarantine and isolation obligations for persons entering Canada that have been introduced to curb the spread of covid-19. These orders have been frequently amended throughout the course of the pandemic and remain in place at the time of writing.
ii The immigration authorities
The ultimate responsibility for administering the IRPA is shared by the Minister of Citizenship and Immigration Canada and the Minister of Public Safety and Emergency Preparedness.
The Minister of Citizenship and Immigration Canada oversees Immigration, Refugees and Citizenship Canada (IRCC), to which he delegates his administrative responsibility. IRCC's responsibilities include facilitating the entry of temporary and permanent residents, granting refugee protection, granting citizenship and the issuance of passports for Canadians. IRCC maintains a network of inland processing offices and consular visa offices abroad where applications are processed.
The Minister of Public Safety and Emergency Preparedness oversees the Canada Border Services Agency, which is responsible for port of entry examinations, enforcement (including arrest, detention and removal) and evaluating inadmissibility on criminality and security grounds. In certain circumstances, visa-exempt individuals are eligible to apply for temporary residence status, including work authorisation, at the port of entry. In this case, a Canada Border Services Agency officer has the authority to assess the application.
The department of Employment and Social Development Canada (ESDC) administers the temporary foreign worker programme, which is accessed by employers who must undertake a labour market test before hiring a temporary foreign worker. ESDC assesses labour market impact assessment applications and has the authority to review the activities and ongoing compliance of employers who use the programme.
International treaty obligations
International treaties play a significant role in Canada's temporary residence programme and facilitate the reciprocal entry of business visitors and foreign workers who hold citizenship with the applicable signatory countries. For eligible foreign workers, the primary advantage of applying for a work permit under these free trade agreements (FTAs) is the exemption from the labour market impact assessment requirement. In other words, the prospective Canadian employer does not need to undertake onerous efforts to demonstrate a labour market need before supporting the work permit application.
We outline a few of the key Canada–international FTAs below. Canada has additional FTAs with Chile, Peru, Colombia, Panama and Korea.
Canada-United States-Mexico Agreement
The North American Free Trade Agreement was superseded by the Canada-United States-Mexico Agreement (CUSMA) on 1 July 2020. It provides for the temporary entry of American and Mexican citizens as business visitors, professionals, intra-company transferees, and traders and investors. Work permit applications under this Agreement can be issued with relative ease, as they can be made at the port of entry and do not require a labour market impact assessment. Professionals in more than 60 occupations can apply for a work permit provided they have pre-arranged employment or a contract with a Canadian company and have the necessary professional qualifications. Work permits can also be obtained by traders and investors who engage in a significant amount of trade in goods or services between Canada and their country of nationality or commit to investing a substantial amount of capital in Canada.
Canada-European Union Comprehensive Economic and Trade Agreement
The Canada–European Union Comprehensive Economic and Trade Agreement (CETA) became effective on 21 September 2017 and provides for the temporary entry of citizens of EU Member States for business and work purposes. This includes business visitors, investors, contractual service suppliers and independent professionals engaging in pre-arranged work in certain economic sectors, as well as intra-corporate transferees. These applications can similarly be processed at the port of entry, and do not require a labour market impact assessment.
Following the United Kingdom's split from the European Union, citizens of the United Kingdom can no longer apply under the CETA. There is indication that there will be a new Canada–UK Trade Continuity Agreement, with ratification expected in early 2021.
Comprehensive and Progressive Agreement for Trans-Pacific Partnership
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is an agreement between Canada and other Asia-Pacific countries: Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. It became effective on 30 December 2018 when most countries ratified the agreement. The CPTPP facilitates temporary entry for business visitors, investors, intra-company transferees and professionals and technicians. Notably, certain provisions are limited to nationals of specific signatory countries, and do not apply to all. For example, the investor provisions are available to nationals of Australia, Japan, Mexico or Vietnam; while the provisions for professionals and technicians are currently limited to nationals of Australia, Japan and Mexico, with each country having its own list of covered occupations.
The year in review
The covid-19 pandemic has drastically overhauled Canadian immigration policy, which has changed dramatically. Regular immigration provisions are not being followed during these pandemic times, and we expect many of the 'temporary' provisions that have been introduced in response to covid-19 will continue for at least the next year as Canada works toward mass vaccination.
i Covid-19 travel restrictions
The closure of Canada's borders in March 2020 has undoubtedly been the most significant policy change this past year. The two emergency orders in council that prohibit the entry of certain foreign nationals in order to curb the spread of covid-19 continue to be in place today despite their initial issuance for only a few months; one regulates entry from the United States and the other entry from outside the United States. Both restrict entry for 'optional and discretionary' purposes, such as tourism, recreation or entertainment. Foreign nationals seeking entry from the United States can continue to apply for entry under regular immigration rules provided their entry is non-discretionary, including business visitor entry and work permits. However, foreign nationals seeking entry from outside the United States face far greater restrictions as they must meet a specific travel exemption set out in the order in council to travel.
The effect on work permit applicants for foreign nationals travelling from outside the United States has been significant. Per the applicable order in council, visa-exempt foreign nationals are not permitted to apply for a work permit at the port of entry as they normally could. Rather, they must apply for a work permit through the applicable visa office overseas, and only with the work permit approval notice in hand will they be permitted to board a flight and travel to Canada. In the early months of the pandemic, processing was at a near standstill as many visa offices closed or drastically reduced their staff. While processing through many overseas offices has improved, many are still operating at reduced levels and are accordingly prioritising applications that they consider to constitute essential work. The prioritisation of applications is riddled with discretion, and the uncertain and prolonged processing times have significantly impacted employers who could previously rely on quick and efficient port of entry processing.
Business travel from outside the United States is not possible for many. The order in council permits after-sales busines visitor entry for technicians or specialists required to install, inspect, maintain or repair equipment necessary to support critical infrastructure in Canada and business visitor entry for those who have received a national interest travel exemption in advance from the visa office. The national interest exemption is reserved for extraordinary circumstances, and in the normal course requires evidence that their urgent entry is necessary to support Canada's critical infrastructure sectors, such as manufacturing, transportation or agriculture. They authorise a single entry, which can be a significant impediment for individuals who previously relied on frequent business visitor travel to Canada.
While foreign nationals travelling from the United States face fewer restrictions and can seek business visitor entry at the port of entry for non-discretionary purposes, the quarantine requirements are a significant impediment and deterrent for short-term business travel.
ii Covid-19 quarantine requirements
In March 2020, Canada introduced mandatory quarantine requirements shortly after implementing the travel restrictions. In the normal course, all persons entering Canada (including Canadians) are required to self-isolate for 14 days upon entry to Canada. In late February 2021, in responding to the increasing spread of covid-19 variants of concern, Canada introduced mandatory government hotel quarantine stays for all persons entering Canada by air. Upon arrival in Canada, travellers take a covid-19 test, and then self-isolate at a government-approved hotel while waiting for the negative test result, which can take up to three days. Upon receipt of the negative test, travellers can then move to a suitable quarantine location where they spend the remainder of the 14 days in self-isolation.
It is possible to request a quarantine exemption in specific limited circumstances, including for essential workers who are supporting critical infrastructure in Canada. The exemption is granted at the discretion of Canada Border Services Agency at the port of entry, sometimes in consultation with Public Health, and this discretion creates considerable uncertainty for workers and their employers. In practice, the quarantine requirements have been a significant impediment to work and business travel.
iii Temporary residents in Canada
Canada has been very generous regarding its treatment of those who are already in Canada in temporary status. For example, applicants who are on work permits may in certain circumstances apply for a new work permit for a new employer on an expedited basis. This was not the case previously. In addition, individuals who have fallen out of status have been given a lengthier amount of time to restore their status and an opportunity to obtain permission to work while the restoration is pending if they are applying for an employer-specific work permit. Further, in specific and unique circumstances visitors can change their status to worker. Again, this was not permissible previously.
i Work permits
Employer-sponsored work permits fall under two umbrella programmes: the international mobility programme and the temporary foreign worker programme. The international mobility programme covers work permits that are exempt from the labour market impact assessment (LMIA) requirement, and employers therefore do not need to demonstrate a labour market need. This includes intra-company transferees, work permits under FTAs as noted previously, significant benefit categories and reciprocal employment situations. The temporary foreign worker programme covers LMIA-required work permits.
International mobility worker programme
Below we outline a few of the notable LMIA-exempt work permit categories.
Global companies can utilise the intra-company transfer provisions to transfer executives, senior managers and specialised knowledge workers to Canada. The qualifying corporate relationship between the foreign company transferring the foreign national and the Canadian company must be that of a parent, subsidiary, branch or affiliate. The foreign national must have been continuously employed for at least one year in the past three years with the foreign company, as well as be currently employed with that company, in a similar position to the one they will hold in Canada.
In the normal course, visa-exempt foreign nationals can apply for the work permit at the port of entry, and visa-requiring individuals can request expedited two-week processing through the visa office if they will be holding a high-skilled position (NOC 0 or A). However, with the current covid-19 travel restrictions, foreign nationals travelling from outside the United States are not permitted to make work permit applications at the port of entry, and there are processing delays at the overseas visa offices. The initial work permit can be requested for up to three years, with two-year extensions possible up to a five-year maximum for specialised knowledge workers, and a seven-year maximum for executives or senior managers.
If a company with an established presence outside Canada is looking to open an office in Canada, it can use the intra-company transfer provisions to transfer key personnel to Canada to start the business. In addition to the general intra-company transfer criteria, the start-up company must demonstrate how it will viably do business in Canada and its ability to support payroll. Initial work permits are limited to one year, and extensions can be requested for the maximum durations noted above provided the company can demonstrate establishment and the ability to create employment opportunities for Canadians.
A work permit category often under-utilised by global companies is reciprocal employment. It allows global companies who provide opportunities for their Canadian employees to work abroad to in turn apply for reciprocal Canadian work permits for foreign nationals. It is a discretionary category, and the company bears the onus of demonstrating that reciprocity exists, which may include evidence of an exchange agreement or global mobility programme, and evidence of reciprocal employment volumes so an officer can assess the number of Canadians given employment opportunities abroad against the number of foreign nationals given employment opportunities in Canada. There is no specific maximum duration for which these work permits can be issued, but reciprocity must be established on each extension application.
Work permit applications under the significant benefit category are very discretionary and reserved for exceptional circumstances, as they avoid the LMIA requirement. The employer must demonstrate that the foreign national's employment will create a clear and compelling social, cultural or economic benefit for Canada, and substantiate this assertion with sufficient documentation to satisfy the officer of the benefit. When arguing a social or cultural benefit, the foreign national is generally a person of high renown or an expert in his or her field, and for economic benefits, the creation or retention of employment for Canadians is a key consideration.
Temporary foreign worker programme
LMIA-required work permits
Often a Canadian company looking to obtain a work permit for a new hire will need to first obtain a labour market impact assessment through ESDC. In the normal course, the process is quite onerous for employers, as they must advertise for the position for a minimum of 30 days per strict programme criteria and outline their recruitment efforts in detail to satisfy ESDC that a qualified Canadian or permanent resident could not be found for the position. Upon approval of the LMIA, the foreign national can make the work permit application, either at the port of entry if visa-exempt, or through the visa office if visa-requiring, currently subject to the covid-19 travel restrictions as previously noted.
In response to the global race to secure top talent, ESDC introduced the global talent stream under the temporary foreign worker programme in June 2017. It initially began as a two-year pilot and has since been made permanent upon receiving a positive reception from Canadian employers. Unlike regular LMIA applications, employers do not need to demonstrate recruitment efforts, and processing is fast-tracked per a two-week processing standard. To be eligible for the programme, employers must be either referred to the programme by a designated partner or seek to fill a position listed in the occupation list, which focuses on information technology occupations such as software engineers and computer programmers. The primary feature of the global talent stream is the labour market benefits plan. With this plan, employers are required to make several commitments that benefit the Canadian labour market, which ESDC reviews annually to verify the employer's continued eligibility under the programme. The employer must commit to either creating Canadian jobs or increasing skills and training investments for Canadians and permanent residents depending on the category under which they are applying and will need to commit to additional complementary benefits, which may include job creation, establishing educational partnerships, increasing in-house training opportunities, facilitating knowledge transfer, or increasing company growth or revenue. This programme has proven particularly attractive to start-up companies in the IT sector, as these commitments are often in line with activities they are already undertaking and so are not difficult for them to fulfil.
ii Labour market regulation
Canada has a robust employer compliance regime under both the international mobility programme and the temporary foreign worker programme in order to uphold the integrity of the programmes and protect foreign workers from abuse. One in four employers who sponsor work permits can expect to be selected for a paper-based compliance review or in-person inspection at random. As part of their compliance obligations, employers must provide foreign workers with substantially the same wages and working conditions, and employment in the same occupation, as noted in the application to Canadian Immigration – either within the Offer of Employment if the application was under the international mobility programme or within the labour market impact assessment if the application was under the temporary foreign worker programme. If an employer is found to be non-compliant, consequences can include administrative monetary penalties, a temporary or permanent ban from applying for future work permits, or a combination of both. The employer's non-compliance is also noted on a public website. In determining the appropriate penalty, factors such as size of the company, nature and number of violations, and past compliance are considered.
iii Rights and duties of sponsored employees
Work permit conditions
If an employer sponsors a work permit, the issued work permit will be employer-specific. Sponsored employees are required to abide by the conditions set out on their work permit, including the period of authorised stay, and the requirement to only work for the named employer in the occupation specified on the work permit. The work permit may also restrict the location of work.
Foreign nationals who hold an employer-specific work permit are not permitted to engage in employment for any other employer. It is possible to apply to change the conditions of a work permit through the inland processing centre without leaving Canada, provided the new employer can and will sponsor the new work permit application. A temporary public policy has been released during the pandemic to facilitate expedited processing for foreign nationals seeking to switch between employer-specific work permits. This has been a welcome policy, as processing times reached six months during the early months of the pandemic, which severely impacted employment access for foreign nationals who are not permitted to change employers until the new work permit is secured.
Duration of stay
Different work permit categories have varying limits on the maximum duration of stay in Canada. For example, as noted above, for intra-company transfer work permits, the total duration of stay is limited to five years if a specialised knowledge worker, or seven years if an executive of senior manager. Many work permits under FTAs are limited to one year initially, with the ability to apply for discretionary extensions. Work permits under the CUSMA professional category are a notable exception in that work permits can be indefinitely obtained in three-year increments provided the foreign national continues to meet eligibility criteria.
A work permit holder is not precluded from pursuing permanent residence. In fact, there is greater access to permanent residence programmes for individuals who have first gained work experience in Canada on a work permit.
Investors, skilled migrants and entrepreneurs
Canada's previous federal immigrant investor programme was cancelled in 2014. Currently, for investors seeking permanent residence in Canada, the only passive investment programme is the Quebec investor programme. It is available to foreign nationals who have a net worth of at least C$2 million, previous management experience and an intention to settle in Quebec. Applicants make a guaranteed investment of C$1.2 million through an approved financial intermediary, which is returned after five years without interest. The applicant will also be assessed on other factors, including age, education and language skills. Currently, as of the date of writing, this programme is on hold but is expected to begin again shortly with some new criteria.
For investors seeking a work permit for Canada, there are the previously noted FTAs that may be available to citizens of certain countries.
ii Start-up visa programme for entrepreneurs
The start-up visa programme is a unique federal programme for entrepreneurs that continues to be underutilised. It provides a permanent residence pathway for entrepreneurs who are seeking to establish a business in Canada (outside Quebec) with the support of a designated organisation, which may be either an approved venture capital fund, angel investor group or business incubator.
There are several features of the programme that make it particularly attractive. Applicants are not required to make a personal investment in the business, given the support comes from the designated organisation, and there is no requirement to meet a minimum net worth or demonstrate previous business experience. The receipt of permanent residence is also not conditional on the success of the business – although one must have a viable business plan that a designated organisation wishes to support. There is also the ability to apply for a temporary work permit once the support of the designated organisation is secured and before the permanent residence application is submitted if the organisation considers the applicant to be essential to the business and there are business reasons for why the applicant is required in Canada before receiving permanent residence.
While the programme initially launched as a pilot in April 2013 and received low interest in the first three years, the programme became permanent in March 2018. The government continues to invest in and promote the programme with the hope of attracting more entrepreneurs to Canada.
iii Provincial nominee programmes for entrepreneurs
While most of Canada's immigration programmes are run at the federal level, there are also provincial nominee programmes run by the individual provinces. This allows the provinces to create their own immigration programmes that will allow them to attract foreign nationals who will benefit their local labour market. The provinces assess the applicant under their own programme criteria and upon approval nominate the applicant for permanent residence. The applicant (now considered a 'provincial nominee') then applies for permanent residence at the federal level based on its provincial nomination.
Many provinces have developed programme streams for entrepreneurs who are establishing a new business or purchasing an existing business in that province. The eligibility criteria vary with each province, but many require the applicant to have a minimum net worth or make a minimum personal investment amount in the business, or both. The programmes require the applicant to have active participation in the business, and passive investment is not sufficient. Applicants often have to demonstrate that they have sufficient business experience and must commit to creating employment for Canadian citizens and permanent residents. Applicants must also demonstrate that they intend to reside in the particular province upon becoming a permanent resident.
The process can often take many years. For many provincial programmes, the applicant is required to first submit a business proposal, and if the province determines it acceptable, a work permit can be obtained. The applicant then begins to operate or establish the business while on the work permit, and if the province is satisfied with its efforts, its can then be nominated for permanent residence and proceed with submitting a federal application.
iv Owner–operator LMIA work permit programme
The owner–operator LMIA programme was cancelled on 1 April 2021. It allowed foreign nationals to apply for a work permit in order to work for a new business they are establishing, or a pre-existing business they have purchased. Applicants were required to demonstrate that they have a controlling interest in the business, and that their role in Canada will result in the creation or retention of employment opportunities for Canadians and permanent residents, or skill transfer to the benefit of Canadians and permanent residents.
The programme has received heavy scrutiny over the years. In practice, officers are afforded a high degree of discretion and look to see that the business is actively engaged before issuing the work permit, although in many cases the applicant's ability to secure the work permit is critical to starting the business. The programme is not a pathway for permanent residence, and many individuals who manage to secure a work permit under this programme are not able to make the transition to permanent residence. While the cancellation of the programme was not surprising to many immigration practitioners, there is a call for Canadian Immigration to take this opportunity to develop federal programmes for business owners that provide greater certainty on access to work permits and permanent residence outside the patchwork of provincial nominee programme, which may present barriers due to net worth or minimum invest requirements.
v Self-employed persons
Foreign nationals who wish to be self-employed or operate their own business for which they control at least 50 per cent of the business can apply for a temporary work permit under a significant benefit category for entrepreneurs and self-employed candidates. As part of the application, they must be able to demonstrate that their activities will create a significant economic, social or cultural benefit for Canada. If self-employed and providing a unique service, the benefit to Canadian clients can be considered as part of this assessment. This work permit category will likely become more heavily used with the cancellation of the owner– operator LMIA programme, but as with that programme, it does not provide a direct pathway to permanent residence.
There is also a permanent residence programme for self-employed persons, but it does not mirror the work permit criteria. It is limited to persons who have self-employment experience in athletics or the arts, such as visual artists, musicians or authors.
Outlook and conclusions
Frankly, it has been a very difficult year for Canada Immigration. The covid pandemic has created a tremendous amount of uncertainty and confusion. In addition, processing has slowed considerably as Canada Immigration and Canada Border Services have scrambled to keep up with constantly changing policies and procedures. Obviously, we look forward to a normalisation of processing and foresee a time when both temporary and permanent applications can be adjudicated in a timelier fashion. In addition, Canada has not been successful in fulfilling the desired number of permanent residents that were anticipated due to the pandemic, therefore in the short term (one to two years), there may be initiatives to boost these numbers. We do anticipate that the immigration programme will be dealing with the effects of covid for at least the next 12 to 18 months.
1 David L P Garson is the managing partner and Jessica N Ravenhurst is a senior associate at Garson Immigration Law.