Where professional credentials or licenses to practice are required to establish or operate the business in Prince Edward Island, the applicant will be required to demonstrate, as part of the business plan, that the credentials or licenses required to start or purchase a business, have been met. For information on foreign credential recognition visit the following websites: http://www.credentials.gc.ca/ and http://www.hrsdc.gc.ca/eng/workplaceskills/credential_recognition/index.shtml
Businesses selling ownership to an applicant of the Business Impact Category must be aware of the terms and conditions of which the investment is being made and ensure the applicable professional advice has been obtained. Businesses must also sign the Acknowledgement of IRPA Reg. 87 Requirements document which outlines the regulations governing economic investment under immigration.
Immigration Services will consider applications under the Business Impact Category that meet, or will meet, the following business eligibility criteria:
- The business must be a for-profit corporation incorporated under the Companies Act of Prince Edward Island or the Canada Business Corporations Act and operated for the primary purpose of earning profits from active income through the provision of products/services.
- The business must be in good standing with the Province on all debts and obligations.
- The business’ corporate headquarters are located in Prince Edward Island.
- The business maintains a “permanent establishment” in Prince Edward Island as defined under the Income Tax Act by regulation 400 (2).
- The business is liable to pay income tax on taxable income earned as a result of a “permanent establishment” in Prince Edward Island, irrespective of income or other taxes which may also be payable in other jurisdictions as a result of income earned or other business activity.
- The business must have good potential for sustained commercial viability.
- The business must have assets with a book value of at least $150,000 CAD which are actively used for the business. Businesses will also be considered if they have assets with a fair market value of $ 150,000 CAD as valued by a certified appraiser or have received a valuation for their business from a professional accountant stating a value greater than $ 150,000 CAD.
- Any business selling a portion of equity to an applicant (i.e., interested in the Partial Ownership Stream) must have also incurred a total of $ 60,000 CAD in wages and/or net income and demonstrate the ability to sustain an applicant’s salary.
- The business must have the potential to create significant economic benefits to Prince Edward Island by contributing to one or more of the following:
- Increasing value-added manufacturing, processing or primary resource activity
- Increasing exports of goods or services
- Increasing destination tourism, tourism attractions, tourism fixed roof accommodations excluding all new construction and recreational property development
- Increasing research and development/technology commercialization
- Increasing technology, skills and specialized know-how to the province
- Servicing an underserved local or regional market
- Diversifying retail and restaurant investment
- No one other than an approved Island agent may represent the applicant in any capacity, to Immigration Services.
Immigration Services reserves the right to limit applications to the Business Impact Category under the various eligible sectors to ensure economic diversity.
Participating Prince Edward Island businesses will be required to sign declaration(s) stating; they acknowledge IRPA Regulations, they will hold the Province harmless, and they have sought professional advice (legal, accounting, tax etc) on the transaction they are entering into.
Prince Edward Island businesses must agree to participate in the evaluation process of the program. To assist in the monitoring and compliance of the Business Impact Category, the business will be required to report to Immigration Services for a period up to (5) five years.
For the applicant to receive approval, the business must be willing to execute and submit a purchase and sale or investment agreement (if participating in the partial ownership stream).
Ineligible Business
Applications will NOT be considered for the following types of businesses:
- Bed and breakfasts, hobby farms (see definitions) and home-based businesses
- Pay day loan, cheque cashing, money changing and cash machine businesses
- Pawnbrokers
- Sale of used goods (excluding collectibles, or where the business provides value-added services such as repairs, refurbishing, or recycling)
- Real estate development/brokerage, insurance brokerage or business brokerage
- Businesses started for the sole purpose of gaining access to immigrant investment through the program
- Professional practices
- Financial services
- Consulting services
- Any other type of business that by association would tend to bring the program or the Government of Prince Edward Island into disrepute.
- An entity that cannot issue shares.
This list of ineligible sectors are meant to serve as an indicator only for those industries either outside of the current scope of the Province’s priorities. Recognizing these priorities may change over time, due to the changing nature of our economic conditions; Immigration Services reserves the right to make additions or deletions to these ineligible sectors.
- Start-ups will not be allowed under the Partial Ownership Stream.
- However, newly incorporated companies created from an existing Prince Edward Island business’ assets will be considered providing;
- A Prince Edward Island business provides $150,000 CAD in assets to the new company,
- The new company is a stand-alone business entity without reliance on the original business, and
- The Prince Edward Island business owner has sufficient expertise in the new company’s area of operation.
- A business that has historically operated as a sole proprietor or partnership will be considered but will need to incorporate prior to the applicant purchasing equity in their company. In these instances, businesses should not incorporate until they are certain that the transaction will move forward.