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Expanding your existing business to Canada

by Harleen Kaur
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Expanding your existing business to Canada

Canada is often a destination of choice of entrepreneurs who are looking to expand their business in Canada. Due to its geographical location and easy access to the North American market, it makes it more attractive to the business owners.

If you’re planning to relocate your business to Canada, our team at Lebiz will assist you moving your business to Canada. Below are the steps to consider while moving your business to Canada.

Steps to expand your business in Canada:

If you’re looking to start your business activities in Canada and also obtain a Canadian work permit, you ought to think about making an application for the Intra-Company transfer (ICT) Program. The ICT program allows foreign-owned companies to expand their operations to Canada and to transfer their employees (executive management, managerial, or employees with knowledge) into Canada. To be qualified for this program, both the expanding business and the primary applicant must meet certain conditions as outlined below.

The process of obtaining a work permit can take anywhere from 2-4 months based on the country you applying from and some other factors too.

Step-1 – Is your foreign Company eligible to relocate to Canada under ICT Program

There are certain requirements that a company has to meet before expanding its operations to Canada. Not every business can be relocated to Canada.

Requirements for company:

  • Active involvement in the business: The parent company is required to be fully operational and actively running a business.
  • Tenure of Business: Your business must be at minimum one year old. The more mature the company is, the more backing it could provide for your application.
  • Sufficient gross revenues: your company must have enough money to fund the expansion into Canada. Although there aren’t any specific minimum requirements for revenue however, your company must be able demonstrate that it has gross revenues of more than $300,000 in CAD. If your company’s earnings are below that amount, you should talk to a lawyer about how to plan the expansion of your business.
  • Liquid funds available: while there is no minimum requirement to run an enterprise in Canada however, your business must be able to prove that it has enough funds to support activities in Canada. We suggest putting aside at minimum $100,000 CAD for the company’s survival for the first year of operation.
  • Reasons for expanding: your company should have a good business reason to expand into Canada. For instance, better service to clients in North America or engaging in exports from Canada is generally considered to be excellent reasons to grow. There are other motives to grow, but ensure you discuss this with your immigration attorney.

Requirements for Primary Applicant:

  • Position in Parent Company: You must be the owner or hold an executive position (COO, CEO, CMO, CTO, etc.) or senior manager or a specialized knowledge worker within your current employer.
  • Employment duration: You must demonstrate that you are employed by your home firm and possess at least one year of work experience within the last 3 years working for your company.
  • Designation in Canada: You must be able to prove that you’re being transferred to a comparable position in Canada.

Step 2 –  Canadian Company Incorporation

After meeting all the pre-requisite conditions, now you will have to incorporate an affiliate firm of the parent company in Canada. The Canadian laws require the company to be associated with the parent company. So, the Canadian entity thus formed will be the subsidiary or an affiliate firm of the existing business.

Once you clarify the structure of ownership of the Canadian entity, now you must decide whether you want this company to be federally incorporated or specific to a province.

  • Federal Company: It allows you to operate your business in any province or territories in Canada.
  • Provincial Company: It allows you to only conduct your business in that particular province.

Step 3 –  Applying for an ICT work permit

After successful registration of your Canadian entity, you can now apply for a work permit. You must collect the entire required document to present it to Canadian immigration officers to verify your eligibility for an ICT program. You must ensure to provide all the documents at the time for applying for a work permit. The documents must include your corporate as well as your personal documents proving your eligibility.

ICT Work permits are typically issued for two years. For newly-established companies operating in Canada the initial work permit can be issued for one year and later extended several times. 

Step 4 – Arrive in Canada & start operating your business

As of today, the current timeline for processing work permit is 14 weeks. Upon approval, you will get a permit to work in Canada. If you wish to extend your ICT work permit, you must ensure to keep following things in mind before demonstrating to the Canadian authorities.

  • You must show your business is genuinely running in Canada & actively selling goods and services to the Canadian customers. however,  It is not necessary that your business should be a profit-making business but it should be viable enough to support the cost of operation.
  • Your entity should have a physical premises and Canada.
  • You must ensure that your company has at-least one Canadian citizen or a PR holder on its pay roles.
  • You must demonstrate that the parent company in still in the same ownership structure as it was during your work permit application.

Step 5 – Applying for PR

After working for an entire year on an ICT work permit, you are now eligible to apply for your PR under Canadian Experience Class (CEC) of express entry. You will attain additional 200 points on your CRS score.  It will certainly make your chances more clearer to obtain  a permanent residency of Canada.

We hope by now you understand clearly how to establish your foreign entity and Canada through an Intra-Company Transfer Program.

We are here to help for any roadblocks which may fall during the processing of your file. We’ve helped many clients setting up their business in Canada. Book your consultation whenever you are ready to take your entity to next level.

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