What is the Owner/Operator LMIA and why it is important for PR applications?

The employment of a temporary foreign worker (TFW) is a very interesting process for all Canadian employers. Thus, in order to employ a TFW, any employer in Canada must obtain authorization from the government. To do so, the employer must prove that by hiring a TFW there is no negative impact to the Canadian labor market. In most cases, the employer must apply for approval of the LMIA (Labor Market Impact Assessment). The application for this assessment must be completed without error, as it passes a very detailed review.

In most cases, the employer must advertise the available positions to Canadian workers within a certain period of time. However, there are some exemptions to this rule. One of such exemptions is the Owner/Operator LMIA. This assessment is made for those foreigners who wish to purchase an established business or launch a new one in Canada and to work in that business as its manager, for example. Usually the foreign nationals do so with the aim to immigrate permanently to Canada in the future. The criteria for qualification of a foreign national as an owner/operator are very simple:

    • He/she must demonstrate a level of controlling interest in the business; and
    • He/she must prove that his/her temporary entry to Canada will create or retain employment opportunities for Canadians and permanents residents and/or transfer skills to Canadians and permanent residents; and
    • He/she must detain a non-dismissible position (must occupy a superior position or one of superior positions in the company without the possibility to be dismissed).

As the Owner/Operator LMIA is an exception to the rule, no advertising or recruitment is required. This option is also available anywhere in Canada. The key requirement is that the foreign national owns at least 50% and one share of a Canadian business. However, there are some other important requirements:

    1. A detailed business plan showing the business financing and creation or maintenance of employment, this plan must include a rudimentary financial plan and timeline of events; and
    2. A foreign national must be actively involved in the management of this business and must have be remunerated according to his/her qualifications and experience at a level equal to or greater than the median wage requirements for the occupied position; and
    3. He/she must employ at least one Canadian or permanent resident in the first year of the company activities.

Receiving a positive LMIA, a foreign national obtains a work permit from IRCC, the duration of which is usually equal to the validity of the LMIA (up to 2 years). After obtaining the work permit, the owner/operator is able to apply for permanent residence through the Express Entry program or Programme de l’expérience québécoise (PEQ – Québec experience program) for the applicants in the province of Quebec.

However, the last modifications made in the Express Entry Comprehensive Ranking System, namely the reduction of points awarded for job offers (including those based on Owner/Operator LMIA) from 600 points to 200 points for senior managerial positions or to 50 points for other positions, don’t automatically guarantee an Invitation to apply for Permanent residence. At the same time, the presence of the approved Owner/Operator LMIA puts a foreign national in a better position to apply for permanent immigration to Canada under the Federal Skilled Worker Program.

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