Can you Still Start a Business in Quebec When you are a Foreigner?

With the closing of two of the programs for business people until March 2018, foreign entrepreneurs wishing to start a business in Quebec or buy a business are wondering if they have other options.

The « Businessmen » Programs

It should be noted that Quebec usually offers three programs for business people, as it designates them, intending to settle in the province:

  • The Entrepreneurs category (closed)
  • The Self-Employed category (closed)
  • The Investor category

 

The financial and experience-related criteria for the above programs are summarized in the table below:

Main Criteria  

Entrepreneurs

 

 

Self-Employed

 

Investor
Net income lawfully obtained, alone or with accompanying spouse or common-law partner  

$300 000 CAD

 

$100 000 CAD $1 600 000 CAD

In addition, the signing of an investment agreement of $ 800,000 CAD, with a financial intermediary authorized to participate in the Investor Program.

 Experience required  

Experience in operating a business for at least two years acquired within the five years prior to the date of application in a profitable and lawful business (agricultural, industrial or commercial) Alone or with the accompanying spouse or common-law partner, at least 25% of the shareholders’ equity.

 

Work experience of at least two years in the profession or trade to be practiced in Québec

 

Experience in management in a licensed agricultural, commercial or industrial enterprise; a licensed professional enterprise whose staff, excluding the candidate, holds at least the equivalent of two full-time positions; an international organization or a government, including any of its departments or agencies.

Each of these programs leads to permanent residence. However, these options have a couple drawbacks: processing times extend out over several years and are open, favouring francophone applicants, exclusively by quotas.

In Quebec, offers are therefore rare to obtain permanent residence in the Business category.

This is all the more the case since the Quebec Ministry of Immigration, Diversity and Inclusion announced that the Entrepreneurs and Self-Employed category will remain closed until March of 2018 and that a reform of these programs is in progress.

One important point: under the Canada-Quebec Accord, the province of Quebec operates its own program for entrepreneurs. In other words, foreign nationals wishing to operate a company in Quebec will not be eligible for federal programs such as the Business Start-Up Visa.

Working in Quebec

In this context, is there is no hope of operating a business before 2020 in Quebec? Of course, there is; provided you turn to the options available with regards to temporary residence.

What are the options?

With the exception of those with an open work permit and cases where intra-group transfers are possible, most foreign nationals wishing to enter Québec will have to apply for a work permit as an entrepreneur.

As with a conventional work permit, it is generally necessary to obtain a prior Labor Market Impact Assessment (« LMIA ») under the owner-operator category and then apply for a work permit once a positive or neutral LMIA has been issued.

The main criteria of the owner-operator LMIA, without a job posting, have recently been clarified and are now established as follows:

• Demonstrate that the foreign worker holds a controlling interest in the company; • Demonstrate that this temporary entry will result in the creation or maintenance of employment opportunities for Canadians and permanent residents or the transfer of skills to these same Canadians and permanent residents;

• Not be in a position where they could be laid-off.

The entrepreneur, who is the majority stakeholder within their company, may be exempted from the LMIA process if they can meet the requirements of a C11 exemption; demonstrating in particular:

• The profits and economic benefits generated by the company will remain Canada,• The planned work period must be truly temporary,

• The applicant must demonstrate that the business will bring a significant social, economic or cultural benefit to Canada,

• The service must be unique in that it does not compete directly with companies that are already well established in Canada.

A work permit under this exemption may be issued for a maximum of two years and may only be extended upon presentation of proof of selection as an entrepreneur by a province.

 

Caution

A work permit application as an entrepreneur must be rigorously prepared. In particular, a foreign national must be prepared to provide any evidence to demonstrate the prospect of economic success of the project (i.e. a business plan established by an accountant), past experience as an entrepreneur and what makes them an exceptional candidate.

As the owner of the business they want to operate, the foreign national will not be eligible for the Québec Experience Program (QEP) to apply for the Quebec Selection Certificate. If they intend to remain in Canada upon the expiry of their status, the entrepreneur will be smart to start the process of applying for permanent residence, if they are eligible, within the first few months of receiving their work permit.

The eligibility of the candidate to be selected by a province is easily measurable in advance, even in advance of any project. Think about it!

 

Hiring a Foreign Worker: A Path Full of Pitfalls?

You have just found the ideal candidate: they have the training, experience and personality you are looking for. You are ready to hire them; however, they are neither a Canadian citizen, nor a permanent resident.

Apart from very large companies with in-house international mobility services that are well-versed in the various recruitment programs for foreign workers, many employers may choose not to hire a foreign worker due to their lack of knowledge concerning immigration in Canada. It would be a pity for your company to deprive itself of a talented candidate, due to such a lack of knowledge, when there are many opportunities for obtaining a work permit in Canada.

The purpose of this column is to establish a base knowledge on the topic of admission into Canada of a foreign worker, to eliminate certain preconceived notions, and to contribute, both to employers and candidates, in developing a better understanding of temporary immigration.

With the above in mind, here are four points to consider when considering hiring a foreign worker.

 

Is a work permit always necessary?

Just about! The notion of « work » is understood in a very broad sense, including any « activity that gives rise to the payment of a salary or commission, or that competes directly with the activities of Canadian citizens or permanent residents in the labor market in Canada « . This may even extend to an unpaid internship or volunteer activities. It goes without saying that an employer must not allow a foreign worker to perform any job-related testing or training until they have their work permit in hand.

 

What work permit to get?

The employer often refers to the idea of ​​ »sponsoring » a candidate for a work permit. This analogy is of interest because most work permits (excluding open work permits) are established on the basis of an offer of employment in Canada. However, a simple job offer received from a Canadian employer is generally not sufficient to allow a foreign national to work in Canada.

An application for a work permit involves following a well-established process, which may take a few hours to several weeks, depending on the case. Does this mean that we should give up? Absolutely not. But the employer must know the different programs available and choose the one best suited to the job they are proposing and the foreign worker they wish to hire.

A common concern among employers is that they have to go through the Labor Market Impact Assessment (LMIA) process. The main concern of employers is that they must first obtain permission to hire a foreign worker after having demonstrated to the authorities that this hiring will not have a negative impact on the labour market in Canada. This usually includes a national job posting and a transition plan.

Fortunately, there are many exceptions to this process.

 

Also, be aware of the fact that there are many positions that can be the subject of a simplified LMIA process in Quebec (therefore exempt from posting the position nationally); which includes several in the field of communications, marketing, Web, IT, video games and VFX. To find out which of these positions qualify for streamlined processing (in French), click here:

 

http://www.immigration-quebec.gouv.qc.ca/fr/employeurs/embaucher-temporaire/recrutement-haut-salaire/liste-professions/index.html

Similarly, there are frequently candidates who would benefit from international mobility programs such as the Young Professionals or intra-company transfer programs, for which a LMIA is not required. These LMIA exemptions make the work permit process much quicker and smoother.

 

Here is the information you need to know, to determine which program will be the most appropriate for an application to obtain a work permit in Canada:

 

  • Nationality of candidate
  • Age
  • Completed Diplomas
  • Current and past work experiences
  • Salary, title and duties of the position being considered in Canada

What happens if a work situation does not work out?

When employing a foreign worker, a perceived barrier to employers still depends on the belief that they are required to secure employment for the duration of the work permit, even if the employee-employer relationship deteriorates. This is a misconception. A foreign national, in the same way as a Canadian, may be dismissed or let go from their job, in accordance with the labour laws applicable in Quebec and / or Canada. The possibility of this reality must also be taken into consideration by the foreign worker, who must bear in mind that a work permit does not guarantee their employment. Moreover, since most work permits are restricted to an employer, the termination of employment raises the question of whether the foreign national will be eligible to stay in Canada for the remainder of their issued work permit.

Can a work permit be extended?

A work permit can be issued for a period of a few days up to 36 months. The work permit can then be extended, however, depending on the job offered, the extension may be limited to a number of years. This temporary status implies, according to the immigration laws in Canada, that the foreign worker will leave Canada at the end of their authorized stay.

Therefore, in order to avoid a large amount of uncertainty, we recommend that the issue of « post-work permits » be addressed in the first few months of employment, in order to leave sufficient time for the application to be processed. For example, if the foreign worker expresses his / her intention to settle permanently in Québec, the foreign worker may be guided in particular by the Québec Experience Program (« PEQ »), which allows a qualified foreign worker to obtain their “Certificat de Selection du Québec (« CSQ »)” fairly easily. The CSQ will most likely allow them to extend their work permit until they become a permanent resident. One of the conditions of this program is to have a good knowledge of French. Again, anticipating in advance, the candidate can take language courses to meet the criteria, if necessary.

 

The conditions of access to this program can be found here:

 

http://www.immigration-quebec.gouv.qc.ca/en/immigrate-settle/temporary-workers/stay-quebec/application-csq/workers-peq/index.html