There are two alternative paths for entrepreneurs considering immigration to Canada in the business class. One is an active investment which means that the business owner is actively involved in managing their own business whereas the other is a passive investment meaning that they are not involved in managing a business but instead they have made a substantial monetary contribution that will be used by other corporations to grow the capital. Passive investment options are very limited. There are only two or three passive investment options available at the moment. Usually passive investment programs require a substantially larger amount of investment capital than active immigration programs.
On the other hand, most of the provinces do have active investment business class programs which will result in permanent residency for a successful business owner. The province of Ontario is one of the most popular destinations for aspiring entrepreneurs due to the fact that the province has the biggest population of 14.6 million, ideal for business growth. How does the OINP nominate applicants to this program? The Entrepreneur Stream application is a two-stage process. The following steps are required to participate in the Entrepreneur Stream:
STAGE 1
Step 1 - Register an online Expression of Interest or EOI (Ontario Provincial Program only). All candidates in the pool are ranked against each other and the once with the most points are invited to apply. The final score will vary between draws depending on the rank of other people in the pool. You may partner with a foreign national businessperson, a Canadian citizen or a permanent resident businessperson. For the purposes of your application to the Entrepreneur Stream, only one foreign national business partner is permitted.
Step 2 - Invitation to Apply is issued by Ontario Government (points system assessment with points for business plan and type of business, location of business, net worth of the investor etc…). If the applicants are invited to apply after step 1, we submit an application to the Entrepreneur Stream.
Step 3 - Submitting Entrepreneur Stream Application for nomination online (still provincial government of Ontario). A complete application will have all supporting documents and proof.
Step 4 - After the application, all information will be verified and completeness checked. As part of the application assessment, you will be required to attend a mandatory interview (will need to come to Ontario and should already have made a previous visit to Ontario in the 12 months before applying for the above).
Step 5 - Performance Agreement. If your application is approved, you will sign a Performance Agreement outlining the commitments you have made to invest and create jobs in the province.
STAGE 2
Step 6 - Work Permit. The province of Ontario will issue a support letter after you sign the performance agreement with which we will apply for a work permit. That means that we can set up all documentation for intent to purchase a business etc and give a deposit, if necessary, but not become 100% financially engaged until this step (work permit approved and performance agreement signed)
Step 7 - Business Establishment (after you arrive). Once you have arrived in Ontario, you will have 20 months to build your business and implement your business plan.
Step 8 - Nomination from Ontario. If you meet your commitments in the performance agreement from step 5, you should get your provincial nominee certificate. This can be complete in 12 months but you have up to 20 months if you need it.
Step 10 - After nomination, we apply to the federal government for permanent residence in less then 6 months from the date of the nomination certificate. Post nomination monitoring will continue for 36 months after PR. That means, you should not have intent to close the business or sell it as soon as you get permanent residence.
Net Worth:
+ If your proposed business will be located within the GTA, you must have a minimum net worth of $800,000.
+ If your proposed business will be located outside the GTA, you must have a minimum net worth of $400,000.
+ If your proposed business will be in the Information and Communications Technology (ICT)/Digital Communications sector (regardless of your proposed business location), you must have a minimum net worth of $400,000.
Job Creation (per 1 business partner, double for 2):
+ You must commit to create at least two permanent full-time jobs for Canadian citizens/permanent residents for a business located within the GTA.
+ You must commit to create at least one permanent full-time job for a Canadian citizen/permanent resident for a business located outside the GTA or in the ICT/Digital Communications sector.
The business should not be seasonal or project-based. It needs to have a place of business in Ontario (not online or virtual location). You can have 3rd party investors who also contribute money to your business with restrictions about who those can be (ex. some banks).
How much money should I invest? It depends on the business location, for instance:
- within the Greater Toronto Area, you must make a minimum personal investment of $600,000 CDN and control at least one-third of the equity in the business
- outside of the Greater Toronto Area, you must make a minimum personal investment of $200,000 CDN and control at least one-third of the equity in the business
- if your proposed business is in the information and communications technology/digital communications sector then regardless of location, you must make a minimum personal investment of $200,000 CDN and control at least of one-third of the equity in the business.
Personal investments must be made towards expenditures that are essential to the establishment and operation of the business, excluding cash, cash equivalents, working capital, or wages paid to you or a family member.
Overall, the OINP Entrepreneur program is a fairly efficient one with some risk to be born by the investor. However, there is room to mitigate the risk prior to signing a performance agreement by delaying investment where such an arrangement is practical.
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