How to fix business immigration

A Winnipeg Free Press article Wednesday outlining how Manitoba's business immigration program fails more often than it succeeds reveals a troubling trend. Will this revelation negatively impact Manitoba's entire immigration program? More importantly, is there a way to fix this problem?

Troubled business immigration programs are not new. In Atlantic Canada, three provinces had to close their business immigration programs at various points in time.

In Nova Scotia, the problems were so serious that the province's auditor general referred a number of matters to the RCMP.

In P.E.I., the Canada Border Services Agency just wrapped up its investigation without laying charges.

While no one is suggesting that Manitoba's problems with its program are criminal, the large number of foreign investors who fail to make their promised investment in Manitoba, and the claims that some are using the Manitoba program to buy their way to other Canadian provinces, must be addressed.

Under Manitoba's business immigration program, foreign investors with business experience must invest at least $150,000 in Manitoba. As security for this investment, Manitoba requires a security deposit of $75,000 prior to immigrating.

In addition, investors must sign a contract outlining their business plan. Once the investor becomes a Canadian permanent resident, he or she has up to two years to carry out his or her business plan.

If the investment is not made in time, Manitoba can keep the $75,000.

Each $75,000 deposit Manitoba keeps represents a failure of the program. Because Manitoba has a limited number of immigration spots each year, each $75,000 deposit Manitoba keeps also represents a potential immigrant who did not get to immigrate here.

If the business immigration program truly has only a 20 per cent success rate, this means that Manitoba is bringing in more than 300 families a year who do not make their promised investments.

These spots could be used for temporary foreign workers already working in Manitoba, international students who have graduated from Manitoba schools, and relatives of Manitoba residents.

Just because an investor does not complete an investment, however, does not mean that the investor has defrauded the government. Investors might be victims of changing economic conditions, exacerbated by delays in the immigration system.

Under the business immigration program, an investor must apply to Manitoba before applying to the federal government. In total, this process can take two or more years to complete.

If an investor's business plan is two years old upon arrival, the economic circumstances may have changed so that their business plan is no longer viable.

In these cases, the failure to make an investment may be the fault of Canada's slow immigration system. From the investor's point of view, why throw good money after bad?

One solution is to give foreign investors permanent residency conditional on their completing their business plan. The concept of "conditional permanent residency" has been used before, and is now in place for individuals who marry foreign spouses.

One problem, however, is that enforcement is the federal government's responsibility. Will Canada want to pick up the dime for Manitoba's errors?

A bigger problem is that conditional permanent residency ignores the fact that immigration processing times may be the reason for the failure to make an investment.

A better solution would be to require investors come to Canada on temporary work permits and make their investments before immigrating.

Using this as a solution, Manitoba would approve an investor's business plan and request the federal government issue the investor a one-year temporary work permit to carry out the business plan.

If the investment is made before the end of one year, the investor could apply for permanent residency. If the investment is not made, the work permit would expire and the investor would have to go home.

By changing the program in this way, Manitoba could gauge the investor's business acumen and commitment before choosing the investor for permanent residency. Because work permits can normally be processed in four months or less, the chances that a business plan could become obsolete are reduced.

By requiring that the investment be made before approving permanent residency, the number of investors using Manitoba as a $75,000 gateway to other provinces would also be reduced.

R. Reis Pagtakhan is a Winnipeg immigration lawyer.

Republished from the Winnipeg Free Press print edition December 6, 2012 A17