Canada: Guide To Doing Business In Canada: Immigration & Work Permit Considerations

Last Updated: November 2 2016
Article by Gowling WLG

Immigration & work permit considerations

Canada's immigration legislation and programs are designed to assist business people and foreign skilled workers with their entry into Canada. The Canadian system also facilitates the entry of foreign entities and business people seeking to start new businesses or subsidiaries in Canada.

Immigration issues should be considered well in advance whenever a foreign entity or worker wishes to enter Canada to do business. The most appropriate immigration strategy and entry option will need to be identified. It must also be determined whether the foreign national requires a work permit or if they may enter Canada as a business visitor.

1. Canada's Immigration and Refugee Protection Act (IRPA)

The IRPA and its regulations affect business opera­tions, human resource planning and potential liability. For example, the legislation influences:

  • The ability to hire foreign workers for positions in Canada
  • Foreign service providers or business people wishing to come into Canada for business purposes
  • The ability of foreign nationals to acquire Canadian permanent resident status
  • Companies and individuals by exposing them to potential liability for breaches of the IRPA

2. Canada's entry and work permit rules: A general overview

As a general rule, no person other than a Canadian citi­zen or permanent resident may work in Canada without valid authorization. As such, the first question to ask is whether or not a foreign national entering Canada requires a work permit.

A work permit is a document that specifies the entity that the foreign national is legally entitled to work for, the occupation and the location of employ­ment in Canada. The work permit also has a specific validity period and sets out conditions that the foreign national must not breach.

The distinction between a genuine business visitor and a foreign national requiring a work permit is not always clear. Under the IRPA, "work" has a broad definition: "an activity for which wages are paid or commission is earned, or that competes directly with the activities of Canadian citizens or permanent residents in the Cana­dian labour market." Business visitors are typically foreign nationals who enter Canada temporarily to engage in international business activities for a short time. These individuals must meet the following general criteria:

  • Business visitors must have no intent to enter the Canadian labour market.
  • The intended activity in Canada must be international in scope.
  • The primary source of remuneration must be outside of Canada.
  • Their employer's accrual of profits must be out­side of Canada.

A foreign national will usually be allowed entry as a business visitor if the purpose of their entry falls under one of the following activities (note, this is a non-exhaustive list of potential business visitor activities):

  • Attending business meetings
  • Exploring business opportunities in Canada
  • Negotiating the sale of non-Canadian-origin goods to Canadian customers
  • Providing some types of after-sales service to Canadian customers
  • Training Canadians employed within the same corporate group as the trainer
  • Attending seminars or trade shows

If, after assessing the person and the purpose of their entry, it is determined that a work permit is required, the next step is to determine whether there is any work permit category under the IRPA, under an international agreement (such as NAFTA) or under any government program that fits the situation. If there is no suitable category available, the employer must first apply to Service Canada to obtain a Labour Market Impact Assessment — formerly called a Labour Market Opinion — which allows employment to be offered to a foreign national instead of to a Cana­dian citizen or permanent resident.

3. Labour Market Impact Assessments (LMIAs) through Service Canada

Generally, the goal is to avoid the LMIA process if pos­sible and to use a non-LMIA work permit category instead. This avoids the risk of Service Canada denying the LMIA request. As well, having to apply for an LMIA will delay the overall time frame for obtaining a work permit compared to non-LMIA work permits.

The Canadian government has made major changes to the LMIA rules since June 2014. Before that time, an LMIA was called a Labour Market Opinion or LMO. Many of the changes have increased the compliance obligations placed on employers using foreign workers.

The application package for an LMIA must be prepared with great care. The entity wishing to hire or engage the foreign national must demonstrate that it has met Service Canada's recruiting requirements, and that the wage being offered meets the prevailing wage rate for the occupation and the location where the foreign national will work.

Service Canada reviews a number of factors when assessing an LMIA application, including whether:

  • The employer has made reasonable efforts to hire or train Canadian citizens or permanent residents.
  • The work of the foreign national is likely to result in direct job creation or job retention for Canadians or permanent residents.
  • The work is likely to result in the creation or transfer of skills and knowledge for the benefit of Canadians or permanent residents.
  • The work is likely to fill a labour shortage.
  • The wages and working conditions are sufficient to attract Canadian citizens or permanent residents.
  • The job offer is genuine.

If an LMIA is granted by Service Canada, it can then be used to obtain a work permit. However, if the foreign national will be working in Québec, special rules apply. Usually, in addition to the LMIA from Service Canada, a Québec Acceptance Certif­icate (CAQ) must be obtained from Québec authorities.

4. LMIA-exempt work permit categories

There are a number of potentially useful LMIA-exempt work permit categories that businesses seeking to hire or bring foreign workers into Canada should consider. Some of the main categories are listed below.

a. Intra-company transferees

This work permit category is useful for transferring managerial or specialized personnel to Canada from a related foreign entity.

The general rules are:

  • The applicant must be an executive or manager, or have "specialized knowledge," and must be transferring into such a position.
  • The applicant must have been employed full-time with the related foreign entity outside of Canada for at least 12 consecutive months in the three-year period prior to the application.
  • There must be a proper relationship between the foreign entity and the Canadian entity receiving the transferee (e.g., parent-subsidiary or affiliates owned and controlled by a common parent company).

Initial work permits are usually granted for up to a three-year period. There are time caps that may limit the overall length of time that a foreign national may stay in Can­ada under this category. Executive or managerial trans­ferees have a time cap of seven years, while "specialized knowledge" transferees may be in Canada under this type of work permit for up to five years.

This work permit category is often used when a foreign company wishes to start doing business in Canada. When setting up the corporate and ownership structure of a new business in Canada, it should be designed in such a way as to allow for the use of this type of work permit. There are special rules for startup situations where the Canadian branch or subsidiary has recently been set up — for example, the initial work permit will be granted for only one year so that the viability of the Canadian operation may be examined prior to granting a renewal of the work permit.

b. North American Free Trade Agreement (NAFTA) professional category

The NAFTA Professional category may be used by eligi­ble American and Mexican citizens. NAFTA lists 63 professions that may be eligible for a work permit, including com­puter systems analysts, engineers, scientific technicians, management consultants, medical and some allied professions, and many scientific categories such as chemists, geologists and biologists.

The applicant must usually have a university degree related to a listed profession, and must be entering the country to work in that field. If the applicant is successful, they will receive a three-year work permit, which is renew­able.

c. Other free trade agreements with entry provisions

Canada also has free trade agreements (FTAs) with relatively similar work permit provisions to NAFTA's Professional category with Peru, Chile, Colombia and South Korea. Eligible professionals from these countries may have special work permit options. Some FTAs also have special provisions to assist with obtaining intra-company transferee work permits.

Canada and the European Union have also entered into a FTA. The Canada-EU FTA will have mobility and work permit provisions, but these will only come into effect when the Canada-EU FTA is ratified and implemented, which may take some years.

d. NAFTA investor or trader categories

These work permit categories are potentially available to American and Mexican applicants who will be employed in Canada by enterprises with an American or Mexican nationality. In this instance, American or Mexican nationality means that at least 50 per cent of the entity estab­lished in Canada must be held by American or Mexican citizens or entities.

For the NAFTA Investor category, the foreign national applicant must (i) be seeking entry solely to develop and direct the enterprise — "develop and direct" means that the applicant should have controlling interest in the enterprise — or (ii) if an employee is in a position that is executive or supervisory, or that involves essen­tial skills. However, a one-year work permit may be granted to an employee not possessing essential skills if the employee is needed for the startup of a new enterprise, such as a technical employee needed to train Canadians who will be hired by the new business.

As well, a substantial investment has to be made. There is no set rule on what constitutes a "substan­tial" investment; it will depend on the circumstances and the nature of the business. The objective of the NAFTA Investor category is to promote productive investment in Canada. Therefore, an applicant is not entitled to this status if the investment, even if sub­stantial, will produce only enough income to provide a living for the applicant and the applicant's family.

For the NAFTA Trader category, the appli­cant must be entering Canada to carry on substantial trade in goods or services principally between Canada and the United States or Mexico. To be "substantial trade," over 50 per cent of the total volume of trade conducted by the entity in Canada must be between Canada and the U.S. or Mexico. The applicant must be employed in a capacity that is executive or supervisory, or that involves essential skills or services.

Initial applications under this category must be made to a Canadian visa office outside of Canada. The initial work permit is issued for a maximum of one year, with extensions granted for two years at a time. Generally, the intra-company transferee category is a preferable option. However, in situations where the corporate structure does not support that category or where the applicant has not worked for the related for­eign company for at least 12 months, the NAFTA Inves­tor or Trader category may provide a solution.

e. Entrepreneurs

There is a work permit category available for entrepreneurs who wish to enter Canada and set up a business that will then be operated by Canadians. This category allows foreign nationals to enter the country temporarily in order to set up their business, and then leave once it is up and running.

f. Spousal employment program

Spouses (including common-law and same-sex spouses) of most foreign nationals working in Canada may apply for a work permit under the Spousal Employ­ment Program. The principal foreign national must be working in a position that is at a higher skill level. Typi­cally this includes management, professional occupa­tions, and technical or skilled trades workers. This program may assist companies in their recruiting efforts since accompanying spouses will usually be able to work in Canada.

5. Permanent resident status

Many foreign workers who obtain work permits in Canada wish to apply for permanent resident status. Canada's permanent resident rules are designed to help such foreign nationals transition to permanent status. If permanent resident status is obtained, the foreign national no longer requires a work permit to work in Canada.

Canada historically had permanent resident pro­grams aimed at business people — investors and entre­preneurs — but these federal immigration categories have now been shut down.

If a foreign national intends to settle in Québec, they will need to qualify for permanent resident status under Québec's immigration system. Québec offers a skilled worker category as well as programs for investors and entrepreneurs. There are also special programs offered by other prov­inces that may lead to permanent resident status.

6. Provincial nominee programs

Canadian provinces have provincial nominee programs (PNPs) in place. Each of these provincial programs is different, but generally the PNPs are designed to facili­tate the recruitment of foreign skilled workers who are able to address skills shortages within the nominating province. Foreign nationals who qualify under a PNP are able to apply for permanent resident status using the nomination from the province. If a foreign national is nominated under a PNP, he or she may obtain a work permit while the permanent resident application is being processed.

Some PNPs also have categories for business people or entrepreneurs. Each of these PNPs has its own unique eligibility requirements and criteria, but the goal is to attract experienced business people or entrepre­neurs to purchase or set up businesses that will create employment for Canadians.

7. Other immigration and entry issues

There are a number of other immigration consider­ations that need to be reviewed when bringing a foreign worker to Canada or travelling to Canada for business purposes.

a. Is an entry visa required?

Depending on the citizenship of the foreign national, an entry visa — called a Temporary Resident Visa or TRV — may be required before the person can enter Canada. Where this is the case, the foreign national must apply for both the work permit and the entry visa at a Canadian visa office outside of Canada. Business visitors from countries that require an entry visa must also apply at a visa office before travelling to Canada. Applications can also be submitted online through Immigration Canada's website.

b. Is an Electronic Travel Authorization (ETA) required?

Canada has introduced a new entry requirement called an eTA. This is mandatory as of September 30, 2016, for most visa-exempt travellers flying into Canada. The eTA must be obtained through an online application process prior to boarding a plane to Canada. Once obtained, the eTA will be valid for five years. There are no eTA requirements for U.S. citizens or foreign nationals with TRVs.

c. Is an immigration medical required?

Foreign nationals who have lived in certain designated countries for more than six months in the 12 months prior to the application, and who are coming to Canada for more than six months, require an immigration medi­cal as a condition of entry. This requirement may delay the application process, as a work permit applicant who needs an immigration medical must usually apply through a visa office outside of Canada.

d. Admissibility issues

A foreign national (and any accompanying dependants) seeking entry to Canada may be inadmissible due to criminal convictions, medical conditions or prior entry refusals. If any of these potential admissibility issues apply to a foreign national, the situation must be assessed well in advance to determine whether entry is possible. Where a candidate is inadmissible due to criminality, steps can sometimes be taken to remedy the situation depending upon the seriousness of the offence, the length of time since it occurred and the number of convictions.

e. Dependants

The accompanying spouse and children of a foreign worker will need to obtain immigration documentation. Spouses may qualify for a work permit under the spou­sal employment program. Children may need a visitor record or study permit.

f. Renewals of work permits

Once a work permit is obtained, the ongoing status of foreign nationals working in Canada must be carefully monitored to ensure that a renewal of the work permit is obtained well in advance of its expiry date. If an LMIA is the basis for the work permit, a new LMIA will need to be obtained before the work permit may be renewed.

g. Changes in position or circumstances

Any change to a foreign worker's job in Canada — such as a change in position, remuneration, duties or work location — must be assessed in advance to determine if a new LMIA and/or new work permit is needed. In addition, if corporate changes such as merg­ers or acquisitions lead to an employer changing its name, the foreign worker may require a new work permit.

8. Other considerations

There are numerous practical considerations beyond identifying the proper immigration or work permit category to use.

a. The application package and supporting documentation

It is imperative to put together a strong application package when applying for an LMIA or a work permit. By ensuring that an application is well documented and complete, the likelihood of it being approved is significantly increased. The extent and content of the material included in the application package will depend on the work permit category and the particular circumstances of each situation.

b. Employment issues

Offers of employment and employment contracts for foreign workers must be carefully crafted. Offers of employment to foreign workers should be made condi­tional on the worker obtaining a work permit and maintaining valid status to work in Canada. Transferred employees and foreign hires should be required to sign an employment contract during the hiring process to govern the employment relationship.

c. Tax issues

Different tax rates or dual tax-filing obligations may need to be addressed in intra-company transfer situations. As well, there may be tax issues or withholding issues for the company or for personnel whenever ser­vices are being rendered in Canada — even where the foreign national may not be directly remunerated in Canada.

d. Obtaining provincial health coverage

In Canada, health coverage is provided by provincial governments. Transferees or foreign national hires on work permits and their dependants will usually be eligible for public health coverage. The eligibility rules vary by province and private coverage should be arranged prior to entry to cover any waiting period. Extensions of work permits should be obtained early to avoid potential disruption in public health coverage.

e. Social insurance numbers

Foreign workers need a social insurance number to be paid employment income in Canada, which may be obtained from a local Service Canada office or by mail. A work permit must be obtained prior to applying for a social insurance number.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
23 Jan 2018, Seminar, London, UK

Join Gowling WLG's pensions team as they explain some of the biggest challenges facing trustees and employers in the coming year and provide practical ways of dealing with them.

25 Jan 2018, Seminar, Birmingham, UK

2018 is set to be another big year in employment, with employers set to face new challenges and responsibilities. At our event, looking ahead to next year, we will be discussing four key issues you might face in 2018, providing useful tips and answering your questions.

2 Feb 2018, Seminar, London, UK

2018 is set to be another big year in employment, with employers set to face new challenges and responsibilities. At our event, looking ahead to next year, we will be discussing four key issues you might face in 2018, providing useful tips and answering your questions.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions