We are often contacted by client’s who are interested in purchasing a business in Canada and would like to know their best options for obtaining a Labour Market Impact Assessment (LMIA) or LMIA exempt work permit.

LMIA

Generally, a Canadian employer needs to conduct a genuine job search to find a local Canadian citizen or Permanent Resident to fill the job, and if the employer cannot locate a qualified person, then they can apply to Service Canada for a Labour Market Impact Assessment (“LMIA”).  In other words, the LMIA is a detailed application process in which the employer demonstrates her/his attempts to hire locally and asks the Government for approval to hire a foreign national.

Service Canada (a division of ESDC), requires the employer to advertise the job for a minimum of four weeks using a variety of methods such as online and newspaper advertisements. However, there are exceptions to this rule, and the “owner/operator” is one.

Significant Benefit

A Canadian employer is exempt from advertising for the LMIA if the foreign national can demonstrate:

“that he is integral to the day-to-day operation of the business and will be actively involved in business processes/service delivery in Canada. In such instances, greater consideration should be given to demonstration by the applicant (owner/operator) that such temporary entry will result in the creation or retention of employment opportunities for Canadians and permanent residents and/or skills transfer to Canadians and permanent residents.”

Percentage Ownership

It is important to determine what percentage of ownership of the Canadian company the foreign national does or will own.

Majority ownership in a Canadian company (50% or more) – the person may qualify for a “significant benefit” work permit. NO LMIA is required.

Minority ownership in a Canadian company (less than 50%) – the person may qualify for an LMIA-based work permit.  No advertising would be required, and the foreign national would need to demonstrate that an employer-employee relationship exists, even though they own a part of the business.

Conclusion

CIC does not want to see a transfer of minority shares for the purpose of a work permit, so the foreign national’s investment into the Canadian business must be real/genuine. In order to learn more about LMIA exempt work permit/owner-operator work permits, please schedule a consultation.