Significant Changes to Canadian Immigration

2024 – GH Discussion Series

Start-Up Visa Business Class Pathway

Canadian immigration policy is currently under extensive review and reconsideration. Various issues are impacting the shaping of immigration policy including housing shortages, temporary foreign worker volumes in Canada and program integrity relating to various pathways to Canada.

This is the first of our 2024 series designed to provide clients and stakeholders insights on the changing climate around immigration policy in Canada. Participants will appreciate the strategic approach to navigate the new directions relating to Canadian immigration.

Background:

• Canadian immigration has evolved to facilitate strategic high-volume intake in many of the pathways or categories. That said, an aggressive immigration program constantly needs fine-tuning and re-evaluation particularly given changing economic conditions.
• The Start-Up Visa (SUV) Business Class Program has been the subject of ongoing policy review for some time. Originally intended as a Pilot Program, the selection criteria were designed to attract innovative start-up businesses without highly restrictive qualifying criteria. Over time, the program evolved in popularity and attracted significant attention internationally as well as the rapid growth of numerous designated entities.
• The program experienced substantial success from a popularity perspective with the number of applicants far exceeding the planned levels for Self-Employed category. The loose criteria also resulted in attracting applicants who do not necessarily have the business profile which was originally intended. This further resulted in program integrity concerns in addition to extensive processing delays with permanent residence applications taking over 37 months in some cases to be processed.

Accordingly, drastic changes were announced on April 30, 2024, which are summarized as follows:

1. Cap the processing of applications associated with 10 start-ups per designated organization annually to reduce backlog. There are currently <> designated entities and VC.
2. Prioritize applications supported by Canadian capital or business incubators within Canada’s Tech Network.

Questions and Answers:

1. Why the Cap: It is introduced via Ministerial Instructions to manage SUV Program applications, aiming to reduce backlog and wait times.
2. Impact on Admissions: Despite the cap, federal Business Class admissions remain strong as per the multi-year levels plan.
3. Duration of Cap: Effective April 30, 2024, until the end of 2026.
4. How Cap Works: Only 10 applications per organization per year accepted; those not meeting these criteria will be returned.
5. Processing Prioritization: Both capped and pre-April 30, 2024, applications processed; some prioritized based on criteria.
6. Impact on Designated Organizations: Encourages selectivity; each organization assigned 10 unique identifying numbers annually.
7. Monitoring Cap Usage: Unique identifying numbers ensure compliance; excess applications rejected.
8. Multiple Designations: Each designation type receives separate identifying numbers; cap limits per designation.
9. Program Interest: High entry requirements persist; measures aim to sustain the program and reduce wait times.
10. Adjusting for Growth: Cap size may adjust based on designated organizations and admissions targets.
11. Tech Network Prioritization: Aimed at leveraging strong connections to promote innovation and economic development.
12. Incubator Capital Commitment: A $75,000 investment is required directly from the supporting organization.
13. Non-Prioritized Applications: All applications processed; improvements expected with additional measures.

Greenberg Hameed Analysis:

• IRCC’s measures aim to streamline the SUV Program, addressing backlog concerns while sustaining Canada’s appeal to entrepreneurial talent.
• Through prioritization and a temporary cap, the program strives for efficiency and effectiveness in fostering innovation and economic growth.
• SUV applicants selected under the cap will benefit from faster processing to allow entrepreneurs the benefit of securing PR status faster which will provide stability in their immigration status and ability to reside in Canada to grow their business and stabilize their personal affairs.
• The impact of the introduction of the Cap is the significant reduction of available certificates available for designated entities to issue to start-up businesses. This will result in increased scrutiny by designated entities in the selection of businesses who will receive a certificate.
• Many prospective start-up businesses will not be able to obtain a certificate under the imposition of the cap and will need to consider alternatives other than the SUV program to find an immigration pathway to launch their Canadian business.
• During the temporary cap period, expect IRCC to consider a re-design of the SUV program to address the evolution of the program. This may very well include more detailed required regulations to ensure that appropriate businesses are selected through the program.
• Furthermore, IRCC intends to reduce the current backlog of applications through the introduction of the cap. Applicants with pending applications must be prepared for faster and more in-depth reviews of applications, given IRCC’s priority in reducing the backlog.
• Applicants should also be prepared to respond appropriately to procedural fairness letters, errors in decisions and where appropriate seeking reconsideration or leave at the federal court. These remedies are even more important given the challenges in obtaining a new certificate given the introduction of the cap.
• The recent changes introduce new considerations for prospective SUV applicants, pending applications, designated entities, and stakeholders in the SUV space. GH will provide ongoing analysis to provide insights and strategies to address these significant changes.