Work Permit [R205(a) – C11]: Canadian Interests – Significant Benefit – Entrepreneurs/Self-Employed

International Mobility Program: Canadian interests – Significant benefit – Entrepreneurs/self-employed candidates seeking to operate a business [R205(a) – C11]

As per subsection 22(2) of the Immigration and Refugee Protection Act, applicants who have a dual intent to seek status as temporary workers and then eventually as permanent residents must satisfy the officer that they have the ability and willingness to leave Canada at the end of the temporary period authorized under section 183 of the Immigration and Refugee Protection Regulations. The applicant must be able to demonstrate that they will have the incentive to depart Canada when their work is complete (e.g., operation of a rib stand at a festival) or the business closes.

On this page

• Applicants seeking only temporary residence
• Applicants seeking eventual permanent residence

Applicants seeking only temporary residence

Foreign nationals applying to work for themselves or to operate their own business on a temporary basis must demonstrate that their admission to Canada to operate their business would generate significant economic, social or cultural benefits or opportunities for Canadian citizens or permanent residents pursuant to paragraph R205(a). Benefits to Canadian clients of a self-employed worker may be considered in this case, particularly if the worker is providing a unique service. If the applicant intends to start or buy a business and eventually stay in Canada on a permanent basis, officers should encourage the applicant to apply for permanent residence.

Factors in considering “significant benefit”

Questions to consider in determining whether paragraph R205(a) is met (regardless of what percentage of the business in Canada is owned) include but are not limited to the following:

• Is the work likely to create a viable business that will benefit Canadian or permanent resident workers or provide economic stimulus?
• Does the applicant have a particular background or skills that will improve the viability of the business?
• Is there a business plan that clearly shows that the applicant has taken steps to initiate their business?
• Has the applicant taken some measure to put the business plan in action (showing evidence of having the financial ability to begin the business and pay expenditures, renting space, having a staffing plan, obtaining a business number, showing ownership documents or agreements, etc.)?

Significant economic, social or cultural benefit

Indicators of “significant benefit” include

• general economic stimulus (such as job creation, development in a regional or remote setting or expansion of export markets for Canadian products and services);
• advancement of the Canadian industry (such as technological development, product or service innovation or differentiation or opportunities for improving the skills of Canadians).
  In cases where significant benefit is being argued, the applicant may provide information up front (or be requested to provide it) from organizations in Canada that can support the application. For example, if an applicant wishes to be self-employed in the tourism industry, officers could request that the applicant provide further submissions from the provincial tourism authority to assist in determining whether the activity would be beneficial or actually impinge on Canadian service providers. Other sources of information and advice include local Canadian Chambers of Commerce and Employment and Social Development Canada (ESDC).

Degree of ownership

The issuance of work permits for entrepreneurs should be considered only when the applicant controls at least 50% of the business in question.

Where an individual is a partial owner with a slightly smaller stake and is coming to work in the business, they are required to apply for a work permit as an employee (rather than as an entrepreneur or self-employed person) and may therefore require a Labour Market Impact Assessment (LMIA).

If there are multiple owners, only one owner is generally eligible for a work permit pursuant to paragraph R205(a), unless exceptional circumstances can be demonstrated. While Immigration, Refugees and Citizenship Canada (IRCC) does not want to discourage investment in Canada, these guidelines are intended to prevent the transfer of minority shares solely for the purpose of obtaining a work permit.

A virtual employer-employee relationship, or the appearance of such, is not a true reflection of a business operation. For more information, see Qualifying relationship between the employer and the foreign worker. ESDC has a policy to issue LMIAs for certain owner/operator situations.

Long-term self-employed applicants

Applicants who have repeatedly been issued work permits over several years in the self-employed or entrepreneur category should, in addition to satisfying the indicators of general economic stimulus, be able to provide evidence of the following:

• registration of their business as a legal entity in Canada;
• demonstration that the profits of the business remain predominantly in Canada or proof that
• other significant benefits have accrued to Canada;
• proof that all appropriate federal, provincial or territorial and local tax returns have been filed; and
• proof that they meet the temporary requirement of subsection A22(2), that they will leave Canada at the end of the period authorized for their stay.

Work permit processing instructions for temporary residence applicants