Evaluation of the Federal Business Immigration Program — 3. Relevance

This section addresses the need for a business immigration program, consistency with departmental and government-wide priorities, and consistency with federal roles and responsibilities.

3.1. Continued Need

Finding #1: Based on the documents reviewed and the key informant interviews, the evaluation found that there is a continuing need to facilitate the migration of business immigrants to Canada in order to contribute directly to the creation of jobs and businesses in Canada. The majority of key informants felt that Canada needs a program like the BIP; however, some were critical of the ability of the BIP, as it was designed, to achieve its objectives.

The need for business immigration was identified many decades ago. As such, business immigration has been a component of the Canadian immigration system since at least the 1952 Immigration Act, which allowed visa officers to admit individuals with sufficient financial resources to establish themselves, and whose business was deemed reasonably likely to be successful. Since its beginnings, the objectives of business immigration have been to stimulate economic growth and to create employment opportunities for Canadians.Footnote 13 However, it was only in 1978 that the Regulations set out for the first time two categories of businesspersons (entrepreneurs and self-employed persons). While the EN and SE classes were formally established in 1978, the IN class was only established in 1986. The need for such classes has been and continues to be based on the expectation that business immigrants contribute to Canada's economy beyond the general economic impact of immigration.

The objective of the Entrepreneur Program (EP) is to attract experienced business persons who will own and actively manage businesses in Canada that contribute to the economy and create jobs. The SEs are expected to have the intention and ability to create their own employment in Canada, and are expected to contribute to the cultural or athletic life of Canada, or have experience in farm management and intend to be self-employed in farm management in Canada. The IIP was designed to attract experienced businesspersons and capital to Canada. As such, the expected outcomes for the BIP overall were to select and admit BIs who would be able to economically establish themselves in Canada, to create additional job opportunities for all Canadians through business start-ups and additional provincial investment in economic development, and to share the benefits of expanded economic development activities across Canada.

Interviewees were asked to provide their opinion on the need for a business immigration program. International program representatives interviewed viewed business immigration as a niche of economic immigration, with the potential to support job creation and expand the global economy. The majority of the other key informants interviewed felt Canada needs a program like the BIP, mentioning benefits like enabling access to foreign capital and skills, creating jobs, expanding international linkages and access to capital through the provincial funds.

However, some key informants were critical of the ability of the BIP, as it was designed, to achieve its objectives. BIP critiques raised by interviewees included uncertainty over the economic impact of BIs, particularly related to business and job creation for ENs and to the economic activity generated for Canadians through the SE class, and the limited effective use of provincial investment funds to support economic development. Moreover, many interviewees felt that the contributions of BIP to Canada's economy were minimal, largely because BIP immigrants are a small group (volume-wise compared to the overall economic immigration), and links to economic activity have not been clearly demonstrated. Supporting those critiques, the literature and document review found very limited past research or information on the contribution of the BIP to Canada's economy, or on the impacts of business immigration programs in other countries. The exception to this was for the IIP, for which reports have been produced by participating P/Ts regarding investments made using funds provided by investors, as well as jobs created or sustained through these investments.

Almost half of case study respondents felt that other economic immigration classes such as FSWP are performing better than the BIP and that, because expected results for the BIP were not being achieved, the rationale for the current EN and IN classes was unclear. The other half of case study respondents said there is a need for Canada to attract immigrants with business skills and bring capital into the country, and the majority felt that there is a need for SE because it fills a niche immigration need.

While there are perceptions that the BIP, as it was designed and implemented, may not be a strong contributor to Canada’s economy, Section 5 discusses program outcomes, and assesses the extent to which BIs have economically established in Canada and contributed to Canada’s economy.

3.1.1. Rationale for the SE class under BIP

Stemming from the need for such a program, the evaluation examined both the rationale for including the SE class under the BIP and the rationale for grouping together athletics, culture, and farm management activities under the SE class.

Based on the documents reviewed, the original rationale for Canada’s SE class in 1978 was to provide opportunities for immigrants who could generate employment for themselves and up to five Canadians, or who could make a significant contribution to the cultural or artistic life of Canada. This distinguished the SE class from the EN class, who were at that time expected to create five or more jobs for Canadians or permanent residents.Footnote 14

While a few key informants felt that the SE class belonged under BIP as immigrants admitted under this class are not intending to pursue paid employment in Canada, many, however, thought that there is no natural fit for SE under any of the economic programs, including the BIP. As such, these individual were neither seen to belong under the Federal Skilled Worker Program as they were intending to be self-employed, nor were they perceived to belong under the BIP as they were not business persons that would undertake entrepreneurial or investment type of activities in Canada. In addition, key informants could not express a clear rationale as to why cultural, athletics and farm management activities were grouped under the SE class, nor was a description of this rationale found during the literature and document review.

Among the three types of occupations under the SE class, farmers were the ones that were most perceived as business people as they intend to operate a farm once in Canada. However, some key informants suggested that immigration related to farm management could be moved to the PNP.

SE class immigrants admitted based on their past experience in cultural or athletics activities were not seen as entrepreneurs or business people. These people are admitted for the cultural and reputational benefits they bring to the country, and not for the potential to create jobs for Canadians, or to take up employment in Canada. The view is that those immigrants would create their own employment through self-employment and would be self-sufficient.

In light of these results suggesting that there is no natural fit for SE under the BIP, especially for SEs admitted based on their experience in cultural or athletics activities, the evaluation performed a review of programs in other countries and found that while some jurisdictions provide specific categories for ‘self-employed persons,’ some others provide programs for people with ‘exceptional talents’ as an avenue to admit candidates who may not qualify under other provisions.Footnote 15 The selection for ‘exceptional talents’ programs is generally done by third parties specializing in the designated field (like academies), as they are the ones who are in the best position to assess and to refer candidates for immigration. Although these tend to be small programs in terms of the numbers of persons admitted, they are generally viewed by KI respondents as useful options in the jurisdictions where they are offered.

Overall, given that SEs are not expected to generate additional job opportunities for Canadians, the rationale for grouping SE class under BIP is now less obvious. Although the SEs admitted to pursue farming activities in Canada can clearly be recognized as business people, the rationale for grouping those admitted to pursue activities in the cultural or sports domains under a business immigration program is less apparent. Exceptional talent programs, as implemented in other jurisdictions, could address CIC’s need for immigrants currently admitted under the cultural and athletics streams of the SE class.

3.2. BIP Consistency with Priorities

Finding #2: As an economic immigration class, the BIP is broadly aligned with GoC and CIC objectives with respect to strengthening the Canadian economy; however, the BIP had become less aligned over time with current CIC and GoC priorities emphasizing innovation.

A review of Speeches from the Throne and Budget Speeches from 2007 to 2011 did not show business immigration noted specifically as a priority, but identified job creation as a priority, and as job creation is one of the objectives of the BIP, the program was aligned in that regard. However, the 2011 Speech from the Throne expressed the Government of Canada’s interest in foreign investment in Canada to facilitate innovation and growth in Canada. Additionally, while the pause on the EN stream was in effect, the Department launched a Start-Up Visa pilot in 2013, in order to provide Canadian private sector organizations with access to a broad range of entrepreneurs in whose ideas they can invest.Footnote 16 The 2013 Speech from the Throne also expressed the Government of Canada’s intentions to reform the Immigrant Investor Program so that these investors make a real contribution in exchange for the security and pathway to citizenship that Canada provides.

These developments suggest that the BIP, the way it was designed, may not be in alignment with evolving Government of Canada priorities.

The relative priority of business immigration as compared to other economic classes may also be inferred, in part, from the annual targets in CIC's Annual Reports to Parliament on Immigration. As discussed in Section 4 of this report, levels target for BIP have accounted for roughly 4% of total immigration and 7% of economic immigration from 2007 to 2011. Therefore, while BIP targets are modest relative to the skilled worker targets, BIP has continued to be aligned with government and departmental priorities as a component of economic immigration policy from 2007 to 2011. Although the 2014 Economic Action Plan proposes to terminate the federal investor and entrepreneur programs, business immigration remains a priority to the GoC as the Plan indicated that development of other avenues to facilitate the migration of business immigrants will be pursued.

Many stakeholders interviewed also noted that the BIP and its three classes are small programs. Some felt that this implies the BIP is a lower priority for Canada as compared with other economic classes. On the other hand, the literature review and interviews conducted with representatives of business immigration programs in other countries found that the business share of economic immigration in Canada is similar to that in other jurisdictions. In other countries, business immigration programs are viewed as a complementary tool to worker immigration programs, each addressing different objectives.

3.3. BIP Consistency with Federal Role

Finding #3: The BIP is aligned with roles and responsibilities outlined for the Federal government in federal legislation. The majority of key informants felt that the federal lead on business immigration was appropriate, and some noted that there was also a role for P/Ts to play, through PNPs, for example.

Federal legislation provides a framework with several pathways for business immigrants to enter Canada, including both federal and provincial immigration programs. Within this framework, the federal government is responsible for determining overall immigration targets, for delivery of a federal business immigration program, and for making a final eligibility determination and assessing the admissibility of those applying to immigrate under provincial immigration streams.

The Immigration and Refugee Protection Act authorizes and outlines Canada's immigration programs, including business immigration, and establishes roles and responsibilities at both the federal and provincial / territorial levels of government. As such, there is a clear federal legislative framework through the IRPA for a federal business immigration program, and such a program is consistent with overall federal government responsibilities for Canadian immigration.

In addition to this role in the selection and admission of BIs, CIC is as well responsible for transferring the IN capital contribution to P/Ts, while the P/Ts are responsible for investing the funds for the purpose of economic development.Footnote 17 The structure of the federal IIP is described in the Technical Appendices.

Through PNP business streams, P/Ts also have a role in the selection of business immigrants. In terms of constitutional authorities, Section 95 of the Constitution Act, 1867, allows the provinces to make laws with respect to immigration into the province, subject to compatibility with federal immigration laws. The IRPR enables P/Ts to establish business streams under their Provincial Nominee Programs (PNPs) for immigrants destined to their jurisdictions to meet their specific priorities and objectives. The IRPR however contains a specific prohibition on passive investment programming in the PNP, but allows for P/Ts to recruit BIs who will actively manage businesses in their regions of Canada. During the period considered for the evaluation, PNPs offered streams to facilitate the immigration of entrepreneurs, self-employed immigrants and active investors. As such, some overlap can be perceived between the BIP and the PNP as both provide business immigration avenues for immigrants seeking to own and actively manage a business in Canada. It would necessitate further research to determine to what extent the two programs compete or complement each other, especially in light of the current lack of alignment between BIP and priorities, as discussed in the previous sub-section.

The Province of Quebec has established the most comprehensive Federal-Provincial agreement (the Canada-Quebec Accord), under which the Quebec BIP operates. The eligibility requirements for the Quebec BIP are aligned with those of the federal BIP. Quebec uses its own selection grid to select BIP immigrants destined for its Province, and issues a certificate of selection to qualified applicants. CIC carries out the admissibility assessments and issues visas to qualified applicants destined for Quebec.

When asked about the consistency of BIP with federal roles and responsibilities, KIs interviewed indicated that BIP was aligned with federal legislation (IRPA) and consistent with federal roles. Some key informants said that there is a role for both federal and P/T governments in business immigration.

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