November 9, 2018 – This editorial written by Attorney Colin Singer, appears in the Lawyer’s Daily.
Since the coming into effect of the Cullen Couture Agreement in 1978, the Quebec government has extensive powers in immigration, to administer the admission of foreign nationals to its province.
On April 6, 2016, Quebec’s government tabled new legislation: the Quebec Immigration Act. On July 18, 2018, it tabled new regulations: Quebec Immigration Regulation, providing for a significant overhaul of its immigration programs, which are both now in force.
The highlights of the new business immigration rules include:
- Introduction of a new entrepreneur stream for entrepreneurs receiving support from a business accelerator, incubator or university entrepreneurship centre.
- Increase of investor net worth and investment requirements.
- Introduction of startup and security deposits for entrepreneur and self-employed worker programs.
Entrepreneur Program
A foreign national who comes to Quebec to 1) operate a business that he creates alone or with others and who received a service offer from a business accelerator, a business incubator or a university entrepreneurship centre or 2) who creates (25 per cent ownership) or acquires a business (control of at least 51 per cent of the business).
Investor Program
A foreign national with suitable management experience of two years in the five years preceding the application, who alone or with his accompanying spouse or de facto spouse has net assets of at least $2 million obtained legally, excluding amounts recently gifted, who undertakes to invest $1.2 million for five years, in a prescribed investment.
Self-employed Worker Program
A foreign national who will come to Quebec to create employment for the applicant by practising a profession defined in the National Occupational Classification.
Here are the selection rules for business applicants.
The Entrepreneur Program
Under the Quebec Immigration Regulation, an entrepreneur is a foreign national who is of at least 18 years of age and who comes to Quebec to 1) operate a business that he creates alone or with others and who received a service offer from a business accelerator, a business incubator or a university entrepreneurship centre or 2) who creates (25 per cent ownership) or acquires a business (control of at least 50 per cent of the business).
The new rules therefore create two application streams for the entrepreneur category.
Stream 1: This stream is for candidates receiving support from a business accelerator, a business incubator or a university entrepreneurship centre, and who wish to open and manage a business in Quebec. It consists in operating a business in Quebec that the candidate created alone or with others, to a maximum of three foreign nationals.
The primary condition to apply for this stream is to obtain the threshold score in the selection grid.
The service offer from a business accelerator, a business incubator or a university entrepreneurship centre will be evaluated based on the following factors:
- Nature of the business project, the area of activity concerned and the needs related to its implementation;
- Company’s region of operation;
- Proposed support plan;
- Operation plan;
- Expertise of the business accelerator, a business incubator or a university entrepreneurship centre.
Stream 2: Under this stream, the entrepreneur must control at least 25 per cent of the shares of a new enterprise, or at least 51 per cent of an acquired enterprise which must have a value equivalent or higher than the funds needed to start the business project.The candidate must also operate the business and actively participate in its daily management.
The entrepreneur must give a startup deposit of $200,000 if the business is outside the metropolitan area of Montreal, or $300,000 for a business within the metropolitan area of Montreal. This deposit is accessed by the entrepreneur from the financial intermediary to carry out the business project.
A security deposit of $200,000 must also be given with a recognized financial institution and kept as a guarantee until the realization of the business project. The deposit is returned after the minister is satisfied the terms of the project have been fulfilled. The minister can keep the security deposit if the business project terms are not fulfilled as provided by R56.
The entrepreneur must also prove the legal acquisition a qualifying net worth of $900,000 alone or with a spouse/de facto spouse, where applicable.
If the business is acquired, it must have been operating for at least five years before the submission of the application and must not have been operated by a former entrepreneur within the meaning of the regulations in the five years preceding the submission date. Excluded businesses include those engaged in financing, insurance, real estate development, real estate brokerage, sale or distribution of pornographic or sexually explicit products.
Entrepreneur applicants, along with self-employed candidates and investors, are assessed under a selection grid comprising several major factors including: education/training, experience, age, language, stay and family in Quebec, financial self-sufficiency, financial resources and business project.
Under the federal Immigration and Refugee Protection Act, 9(1)(d), Quebec entrepreneurs and their dependants are subject to terms and conditions of landing which are regulated under Quebec law. Entrepreneurs must meet terms of admission for 12 consecutive months, within three years of arriving in Canada.
Processing delays
Current processing delays at the provincial level vary from eight to 12 months for investor applications, as MIDI centralized the processing of its business applications in Montreal. This has resulted in reduced processing delays. Processing times for entrepreneur and self-employed can surpass 36 months.
The Quebec Ministry of Immigration, Diversity and Inclusion will receive a maximum of 60 new entrepreneur applications during the period Sept. 10, 2018, through August 31, 2019. This includes 25 under Stream 1 and 35 under Stream 2. However, candidates who demonstrate an intermediate-advanced knowledge of French language (by presenting French test results of level B2 in speaking and listening) may apply at any time and are not subject to any annual quotas.
This is the first of a two-part series. Part two will cover the Investor Program and the Self-Employed Worker Program in detail.
Read part two
Selection rules for Quebec business immigrants – Part II
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