Labour Market Impact Assessments

If you are purchasing a business in Canada, it requires that you have a clear agenda, understanding and roadmap before proceeding. It also requires you to understand the Government compliances involved. While there are quite a few Business Investment opportunities laid out by Canada’s federal government on paper, they haven’t really been able to capture the interest of foreign investors. With Owner-operator policies in place these are set to change.

What is LMIA Owner/Operator Work Permit?

With this, international high net-worth individuals can buy business in Canada and obtain temporary work visa which then can be converted into Permanent Residency there. To qualify for this program, there needs be an entity that can employee the foreign national and can apply for Work permit; and there needs to be an investor. The entity could be a company (Small to medium size to large) or an individual.

  • There must be an entity who is an employer
  • The employer must offer employment to the foreign national along with a compensation for a given time period.
  • The employer must be a recognized entity that can fulfill regulatory responsibilities laid down by the government.
  • They should fall under the category that comes under the administration and enforcement of Temporary Foreign Worker program.
  • You as a foreign employee will also be the investor.
  • You should establish a control in the business through purchase of shares in the business
  • You should actively participate in the everyday running of the business
  • You as the investor and foreign employee will need to actively engage in the management of the business
  • You will need to make an offer.
  • Your active participation and your involvement in the business will be assessed, along with your prior management experience in managing or operating a business

Important Notes

  • Simply owning shares does not qualify you, a foreign national as a genuine Owner-operator. You would also need immigration approval.
  • Transaction will be carried out in multiple stages. This is taking into consideration both investment and commercial practices. You need to keep track of completed transactions, on-going purchases and future investments.

What is Temporary Foreign Worker Program (Few Owner-operator Guidelines

  • Entrepreneurs of foreign decent should acquire an established business or should be willing to launch a new business in Canada. The entrepreneur should apply for Work visa as an employee in the Management cadre.
  • With the Temporary work visa, the entrepreneur will enter Canada and participate in the day to day running of the business. They will then have to apply for Permanent Residency in Canada within one year of relocation either through Canada Express entry system or through Provincial Nominee program.
  • The foreign investor entrepreneur can invest in a running business or a start-up wholly or partially.
  • This acquisition of business or start of business in Canada, should promote retention and creation of jobs for local citizens or residents of Canada.
  • Such foreign entrepreneurs will have to actively participate in knowledge transfer to the locals

Who is an Employer

  • As under the Temporary Foreign Worker program, there must be a clear identification of the employer-employee relationship. This is also required for clear identification of regulatory responsibilities.
  • If you are a self-employed intending to establish business in Canada or purchase a business in Canada to be involved in its day to-day running, then your business plan and the contract of purchase of shares will need to establish an employer-employee relationship along with an offer letter for employment.
  • On the eve that there is no “job offer”, as would be the case for most of the Temporary Foreign Work Permit cases, the processing officer for the case will consider the business plan and share purchase contract to identify the strength of the case. Most times, the strength of the case would depend on the kind of knowledge being brought into the country, the willingness of the investor to share the knowledge and the number of jobs retained or created for the locals.

Assessment of an LMIA for Existing Business

  • Purchasing Whole business (100%)
  • Purchasing partial business

Complete 100% Ownership – The entrepreneur who is also the new employer will have to apply for the Labour Market Impact Assessment (LMIA) to obtain owner-operator management based work visa.

Pending Complete Purchase – If the transaction is still pending for 100% transfer of ownership, either the current owner or the incoming owner can apply for LMIA. The current owner can act as the “employer” who is offering a Job for the investor. They will need to provide information about the percentage share or complete transfer of shares, along with the information about the retention and creation of more jobs in Canada.

Partial Purchase – It requires that the current owner’s and the foreign investor’s percentage share is established. It also requires the role of the other stakeholders involved in the business. The business in question should be generating considerable profits. The case officer will assess genuinely of the project considering the level at which the transaction stands, the purchase agreement and the escrow values. They also take into consideration the business plan provided by the foreign investor. The existing owner will act as the employer issuing a Job offer to the foreign investor to obtain the Temporary Work Permit. They will also have to apply for the Labor Market Impact Assessment.

Assessment of an LMIA for New Businesses

The Foreign entrepreneur will start a new business under the LMIA and work permit. The said business should be up and running providing the goods or services. The following are few guidelines for the same:

  • A Viable Business Plan
  • Documents showing the incorporation of the business, applying for licenses if any, lease agreements, securing contacts and anything that could prove the running of the business
  • Intention of Creation and Retention of Jobs for local residents and citizens of Canada
  • The entrepreneur will need to prove his business abilities along with having to take up the language ability tests.
  • They will need to prove their communication skills.
  • They will need to prove their control on the business

There is more to this pathway. It is safe to say that, it could be a little complicated, if you approach this program on your own, although having a Temporary work permit is highly effective in execution of your business plans. It would be necessary for you to work with XIPHIAS to get through this program

Time-frame for the Process

To will take 2 to 3 months for the LMIA application process and a further 3 months to obtain the Temporary work permit.

It is not a regular program defined by the Government. However, it heavily depends on the policies defined for Owner-operator and other immigration programs.

What XIPHIAS can do?

  • We can take care of all the documentation
  • We can connect you with the right businesses that requires investment in Canada
  • We help you with your net-working
  • We help you with the Temporary work permit and the process there on
  • We can guide you and be with you till you obtain your Permanent residency in Canada.
  • We help you evaluate and deliberate before proceeding at every stage possible
  • We also keep you updated.

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