March 6, 2014
Changing Programs for Immigrant Investors
By: Diandra Farquharson & Amy Whittam
Citizenship and Immigration Canada announced in February that it intends to terminate the Federal Immigrant Investor Program and the Federal Entrepreneur Program as a part of the Economic Action Plan of 2014. These programs will be eliminated retroactively, meaning that the existing backlog of 65,000 pending applications will now be left unprocessed. The majority of these unprocessed visa applications were from mainland China.
Under the Federal Immigrant Investment Program, foreign investors with a minimum net worth of $1.6 million were granted Permanent Residence in Canada in exchange for making an interest-free loan of $800,000 to the Government of Canada for five years. The Canadian government would then return the principal amount in installments over the subsequent five years.
In a 2014 budget report, Canadian Finance Minister Jim Flaherty expressed concern that the two programs do not adequately ensure that investors maintain ties to Canada once they have received permanent resident status. The Minister also discussed the economic contribution to Canada, noting that foreign investors tend to pay less Canadian taxes over a lifetime than other categories of economic immigrants. Citizenship and Immigration Canada is looking into replacing the cancelled programs with suitable alternatives which address these concerns.
One such program is the new Start-Up Visa Program. Last year the Minister of Citizenship and Immigration introduced the Start-Up Visa Program to lure entrepreneurs to Canada. The goal of the Start-Up Visa is to attract high-growth businesses and entrepreneurs who can make a positive contribution to the Canadian economy, while also contributing to a culture of innovation in Canada. Under this program, immigrant entrepreneurs are connected with Canada’s accredited business incubators to provide valuable mentorship and help grow start-ups into sustainable businesses that create jobs in Canada.