New investor visa program to be launched this month

20 Jan 15

CANADA

IMPACT – MEDIUM

What is the change? Citizenship and Immigration Canada is planning to launch an Immigrant Investor Venture Capital pilot program this month in an effort designed to attract a small number of wealthy investors and their families to Canada.

What does the change mean? The program will allow up to 50 foreign investors to qualify for permanent residence in Canada. To be eligible, each applicant must be able to invest 2 million Canadian dollars (about US$1.65 million) for 15 years and demonstrate a net worth of at least CA$10 million.

  • Implementation timeframe: The pilot program will be launched by the end of the month, according to Citizenship and Immigration Canada.
  • Visas/permits affected: Permanent residence.
  • Who is affected: Eligible foreign investors.
  • Impact on processing times: Citizenship and Immigration Canada will accept no more than 500 applications for 50 spots, and hopes to keep processing times for the permanent residence stage of the application at around six months.
  • Business impact: While the Canadian government says the program will attract investors who will contribute to Canada’s “economic growth and long-term prosperity,” the relatively modest scope of the pilot program makes it difficult to determine how much of an impact it will have on the broader business community.
  • Next steps: Officials are expected to begin accepting applications later this month, although no exact date has been set. BAL will continue monitoring the program.

Background: Canada terminated its Immigrant Investor Program and Entrepreneur Program in June 2014. Officials are hoping that the pilot program will lure wealthy investors to Canada without experiencing the same backlogs that plagued the past investor programs.

Investors will be required to make CA$2million of nonguaranteed investments for 15 years in order to qualify. That money will be used to invest in Canadian start-up companies deemed to have high-growth potential. Other eligibility factors for investor applicants include demonstrated proficiency in either English or French, a Canadian post-secondary degree or the foreign equivalent, and a legally obtained net worth of at least CA$10 million.

After it begins accepting applications, Citizenship and Immigration Canada will review a maximum of 500 applications within a set timeframe. Applications will then be selected at random until 50 applications are approved and finalized. Those 50 applicants will be eligible for permanent residence in Canada.

BAL Analysis: The pilot program will provide up to 50 investors and their families with permanent residence in Canada and could boost the prospects of Canadian start-up companies. It remains to be seen, however, whether the pilot program will be able to avoid backlogs that plagued past foreign investment programs and how broadly the economic impact of the new program will be felt. BAL will continue to monitor the program as it is unveiled.

This alert has been provided by the BAL Global Practice group and our network provider located in Canada. For additional information, please contact your BAL attorney.

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