Immigration Information
Who Qualifies as an "Entrepreneur"?
(New Definitions & Criteria)
In June 2003, new immigration rules took effect, bringing changes to the
selection criteria for entrepreneurs. The new rules give more defined terms for
such aspects as "business experience", "net worth", "assets" and "qualifying
Canadian business" relating to the entrepreneur application category.
Below is a summary of the new definitions and basic criteria entrepreneur
applicants must now satisfy in order to qualify for a permanent resident visa.*
*These new immigration rules apply to all entrepreneur applicants, including
those who applied before the new rules came into effect in June 2003. This
criteria does not apply to entrepreneur applicants who are selected by a
province.
An ENTREPRENEUR is an applicant who:
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business experience; and,
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has a legally obtained minimum net worth.
"Business Experience" means:
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the management of a qualifying business; and,
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the control of the percentage of equity of the qualifying business for at least
two years during the period beginning five years before filing the immigration
application and ending when the immigration application is approved.
"Minimum Net Worth" required for an entrepreneur applicant is $300,000 CDN.
"Net Worth" means the fair market value of all the assets of the entrepreneur
and their spouse, minus the fair market value of all their liabilities.
TERMS AND CONDITIONS PLACED ON THE ENTREPRENEUR'S VISA:
Once the entrepreneur lands in Canada as a permanent resident, they must
satisfy the following conditions no later than two years after arriving:
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They must control at least 33 and 1/3 percent equity of their qualifying
Canadian business;
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They must provide active and ongoing management of their qualifying Canadian
business;
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Their qualifying Canadian business must create at least one full-time job (or
equivalent) for Canadian citizens or permanent residents* (*not including the
entrepreneur's family members)
OTHER DEFINITIONS RELATING TO ENTREPRENEURS
"Qualifying Canadian Business" means a business operated in Canada by the
entrepreneur. This business cannot be one that is operated primarily for the
purpose of deriving investment income, such as interest, dividends or capital
gains. No later than two years after the entrepreneur lands in Canada as a
permanent resident, they must have documentary evidence of any two of the
following:
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The percentage of equity of the qualifying Canadian business multiplied by the
number of full-time jobs (or full-time equivalents) equals at least two
full-time job equivalents per year;
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The percentage of equity multiplied by the total annual sales equals at least
$250,000;
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The percentage of equity multiplied by the business' net income for that year
equals at least $25,000;
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The percentage of equity multiplied by the business' net assets at the end of
that year equals at least $125,000.
"Qualifying business" means a business that is not operated primarily for the
purpose of deriving investment income, such as interest, dividends or capital
gains. For any two years during the period beginning five years before filing
the immigration application and ending when the immigration application is
approved, the entrepreneur must have documentary evidence of any two of the
following:
-
The percentage of equity of the qualifying business multiplied by the number of
full-time jobs (or full-time equivalents) equals at least two full-time job
equivalents per year;
-
The percentage of equity multiplied by the total annual sales equals at least
$500,000;
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The percentage of equity multiplied by the business' net income in that year
equals at least $50,000; and,
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The percentage of equity multiplied by the business' net assets at the end of
that year equals at least $125,000.
"Percentage of equity" means:
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For a Sole-Proprietorship - 100% of the equity that is controlled by the
entrepreneur or their spouse;
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For a Corporation - the percentage of the issued and outstanding voting shares
of the capital stock, that is controlled by the entrepreneur or their spouse;
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For a Partnership or Joint Venture - the percentage of the profit or loss to
which the entrepreneur or their spouse is entitled.
"Net Assets" of a qualifying business or a qualifying Canadian business means:
All assets of the business, minus all liabilities of the business, plus any
shareholder loan made to the business by the entrepreneur and their spouse.
"Net income" of a qualifying business or a qualifying Canadian business means:
The after tax profit or loss of the business, plus any remuneration from the
business to the entrepreneur and their spouse.
For additional information regarding the entrepreneur application category,
please visit www.immigrate.net, or send an e-mail to rosenblatt@immigrate.net.
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