On This Page, You Will Find:
- Where the Start-Up Visa stands in 2026
- What active and ongoing management means
- What counts as an essential part of operations in Canada
- How ownership, incorporation and timing are assessed
- The primary purpose test and artificial transactions
- What the Federal Court has said
- How one co-founder can affect the whole team
- Evidence to build and keep while you wait
- What Bill C-12 does and does not yet do
- Frequently asked questions
The Start-Up Visa (SUV) Program is closed to new applicants and has been since the middle of 2026. What remains is a large inventory of applications filed before the cut-off, and a group of founders who must now hold their businesses together through a queue measured in years rather than months.
For those applicants, one requirement matters more than any other: the obligation to provide active and ongoing management of a qualifying business from within Canada. It is the requirement most often tested by officers, most often litigated in the Federal Court, and the one most easily eroded by a long wait. This article sets out what the requirement means, how it is assessed, and what founders in the queue should be documenting now.
Where the Start-Up Visa stands in 2026
Immigration, Refugees and Citizenship Canada (IRCC) closed the program in stages. On 19 December 2025 it stopped accepting new applications for the optional SUV open work permit, leaving only in-Canada extensions available. Effective 31 December 2025 at 11:59 p.m., it stopped accepting new SUV permanent residence applications, with one exception: applicants holding a valid commitment from a designated organization made in 2025 could still file. That window closed on 30 June 2026.
IRCC also stopped accepting commitment certificates from designated organizations after 31 December 2025 and is not designating new organizations. Applications received before the deadline continue to be processed. The pause on the Self-Employed Persons Program was extended at the same time, and the department signalled a “high impact” entrepreneur pilot for 2026, for which no eligibility criteria have yet been published. Our overview of the Start-Up Visa suspension and the promised 2026 entrepreneur pilot tracks what is known.
The practical consequence is that nothing about the eligibility test has been relaxed. Applicants are assessed against the same regulatory requirements, but with a longer interval between filing and decision in which the business must remain real.
What active and ongoing management means
Under section 98.06(1) of the Immigration and Refugee Protection Regulations (IRPR), a business is a qualifying business only if:
- the applicant provides active and ongoing management of the business from within Canada;
- an essential part of the business’s operations is conducted in Canada;
- the business is incorporated in Canada; and
- the ownership and voting-rights conditions are met.
IRCC’s program delivery instructions treat the management, operations and incorporation tests as forward-looking. They are assessed on the applicant’s intention as at the time they become a permanent resident, not on the state of the company on the day the application was filed. IRCC’s own public guidance is phrased the same way: if the application succeeds, the applicant must incorporate in Canada, provide active and ongoing management from inside Canada, and ensure an essential part of operations happens in Canada.
“Active and ongoing” is not defined by a minimum number of hours. In practice it distinguishes a founder who directs the business from one who merely holds shares in it. Passive investment does not satisfy it. Nor does a nominal officer title held by someone who takes no decisions. What officers look for is evidence that the applicant personally exercises the executive function they claimed — strategy, hiring, product direction, financial control — and that this function is exercised from Canada rather than delegated to someone else.
What counts as an essential part of operations in Canada
The “essential part” test asks whether something the business genuinely could not do without is happening in Canada. It is a qualitative test, not a headcount. A Canadian mailing address, a bank account and an incubator subscription are not operations.
The requirement appears on the commitment certificate itself. Designated organizations must give IRCC a detailed explanation of the essential parts of the business operations that will be conducted in Canada, and must identify the specific role each team member will play — for example, if a founder is to be CEO, the certificate must state the title and the tasks that person will be responsible for. That description becomes the benchmark against which the founder’s later conduct is measured.
Modern businesses can be remote-capable, and IRCC does not require every function to sit in Canada. It does require the centre of gravity — the decision-making and the core value-creating activity — to be there.
How ownership, incorporation and timing are assessed
The ownership test is fixed to a single moment: it is measured at the time the commitment is made. At that point, each applicant must hold at least 10 per cent of the voting rights attached to all outstanding shares, and no person or entity other than qualified participants — the designated organizations and the applicants making up the entrepreneurial team — may hold 50 per cent or more. Together, the qualified participants must hold more than 50 per cent.
Because the test is anchored to the commitment date, later dilution does not retroactively disqualify a file, but a cap table that no longer matches the commitment certificate invites questions. Our guide to the business ownership rules for Canada’s Start-Up Visa sets out the thresholds in detail.
Incorporation may be conditional on the issuance of permanent residence, which is why a pre-landing corporation is not always required. Separately, IRCC’s instructions carve out older files: applications received on or before 31 March 2018 cannot be refused on certain of these grounds.
The primary purpose test and artificial transactions
IRPR 89 gives officers a distinct basis for refusal. An officer may refuse where the agreement or arrangement with the designated organization was entered into primarily for the purpose of acquiring a status or privilege under the Act, or where it is otherwise not genuine.
This is where a paper start-up fails. Where the venture shows no product, no customers, no spending and no founder activity, an officer can reasonably infer that the commitment was bought rather than earned. IRCC also assesses the designated organization’s side of the transaction: if an officer is not satisfied that the organization assessed the applicant and the business in a manner consistent with industry standards, or that the terms of the commitment are consistent with industry standards, the application may be refused. Designated organizations are required to perform due diligence on the applicant, the business and the investment, including source of funds.
What the Federal Court has said
Federal Court jurisprudence has been consistent in upholding refusals where the entrepreneurial substance was thin.
- Yang v. Canada, 2019 FC 130 — weak pre-launch research, planning and due diligence, whether by the applicant or the designated organization, can support a finding that the arrangement was immigration-driven. Boilerplate business plans are a liability.
- Kwan v. Canada, 2019 FC 92 — a founder who obtains an early work permit and comes to Canada has their operational progress scrutinised. Little progress, without explanation, cuts against the management requirement.
- Damangir v. Canada, 2024 FC 599 — the refusal of a founding team was upheld where a co-founder failed to disclose a prior temporary resident visa refusal, illustrating how team files stand or fall together.
- Punjwani v. Canada, 2026 FC 1033 — an officer’s assessment is based on the totality of the evidence rather than any single concern, and procedural fairness arguments not raised in written submissions may not be advanced later.
How one co-founder can affect the whole team
The start-up business class is built on collective dependency. A designated organization identifies on the commitment certificate the applicant it considers essential — the person without whom it would not have invested — and may identify more than one. Where an applicant identified as essential is refused, the other applicants relying on that same commitment can be refused with them.
The same linkage applies procedurally. IRCC will not process any application from a team until it has received them all, and each partner must file separately. Compliance is therefore a team obligation, not an individual one.
Evidence to build and keep while you wait
A file that sat dormant for three years is difficult to defend. Officers expect a continuous record. Founders should be maintaining:
- product development records — development logs, prototypes, releases and specifications showing the minimum viable product advancing;
- commercial traction — signed letters of intent or contracts with Canadian customers, pricing work, supplier negotiations and Canadian market research;
- governance records — board minutes, resolutions, a current cap table, filed intellectual property and audited or reviewed financial statements;
- role evidence — proof that each founder is performing the duties described on the commitment certificate, and that decisions are being taken by them;
- a written explanation of anything the founder cannot do from outside Canada, and what they did instead.
Founders already in Canada on an SUV work permit should note the extension criteria, which remain demanding: they must hold or be eligible to restore a valid SUV-category work permit, have a pending PR application, be an essential member of the team with all team PR applications pending, intend to reside outside Quebec, show significant economic benefit such as job creation or innovation, hold funds to support their family for 52 weeks, and show funds to continue developing the business. Our page on the Start-Up Visa open work permit covers the mechanics.
What Bill C-12 does and does not yet do
Bill C-12 received Royal Assent on 26 March 2026 (S.C. 2026, c. 4). It creates powers to cancel or suspend immigration documents, to cancel or suspend the processing of applications, and to pause intake, on public-interest grounds. Each of those powers requires an order in council published in the Canada Gazette before it can be used.
No order in council applying those powers to Start-Up Visa files has been identified. Pending SUV applications are therefore being processed under the ordinary rules, and the powers remain a contingency rather than an active measure. Our coverage of the immigration measures retained in Bill C-12 explains the scope of the legislation. Entrepreneurs who cannot wait may want to compare provincial entrepreneur programs, several of which remain open.
Sources
- https://www.canada.ca/en/immigration-refugees-citizenship/news/notices/immigration-measures-entrepreneurs.html
- https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/start-visa/eligibility.html
- https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/start-visa/participate/applicants-process.html
- https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/start-visa/work-permits/eligibility.html
- https://www.canada.ca/en/immigration-refugees-citizenship/services/application/application-forms-guides/imm5766.html
- https://www.canada.ca/en/immigration-refugees-citizenship/corporate/publications-manuals/operational-bulletins-manuals/permanent-residence/economic-classes/start-business/substituted-evaluation.html
- https://www.canada.ca/en/immigration-refugees-citizenship/corporate/mandate/policies-operational-instructions-agreements/ministerial-instructions/other-goals/mi72.html
Frequently Asked Questions
What are the active management requirements for Canada’s Start-Up Visa?
An applicant must provide active and ongoing management of the qualifying business from within Canada, and an essential part of the business’s operations must take place in Canada. IRCC assesses these on the applicant’s intention as at the time they become a permanent resident. Passive shareholding or a nominal officer title does not satisfy the requirement.
Is the Start-Up Visa Program still open in 2026?
No. IRCC stopped accepting new permanent residence applications after 31 December 2025, except from holders of a valid 2025 commitment, whose filing deadline was 30 June 2026. That deadline has passed and the program is paused. Applications received before the deadline continue to be processed.
Can Start-Up Visa applicants still get a work permit?
New applications for the optional SUV open work permit have not been accepted since 19 December 2025. Applicants who already hold an SUV-category work permit may apply to extend it while their permanent residence application is pending, provided they still meet the criteria, including being an essential team member and showing significant economic benefit. Applicants abroad without an existing permit have no work permit route under this program.
When is Start-Up Visa business ownership measured?
Ownership is measured at the time the commitment from the designated organization is made. At that moment each applicant must hold at least 10 per cent of the voting rights, and qualified participants together must hold more than 50 per cent. Later changes to the cap table do not retroactively fail the test, but they should be documented and explained.
What evidence should Start-Up Visa applicants keep while waiting for a decision?
Useful evidence includes product development logs and prototypes, letters of intent or contracts with Canadian customers, Canadian market research, financial statements, board minutes, a current cap table and intellectual property filings. Applicants should also document that each founder continues to perform the role recorded on the commitment certificate. A written explanation of what could not be done from outside Canada helps address gaps in activity.