Canadian Immigration News

Owner Operator LMIA for Business Owners

5.3 minute read
"Owner operators entering the Canadian market from abroad may spend less time and money on immigration processes because of exemptions offered by the government. Most workers require an LMIA (Labour Market Impact Assessment), but qualified owner operators get to avoid the process altogether."
Written by My Visa Source Team
Updated on:  Feb 28, 2021
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Owner operators entering the Canadian market from abroad may spend less time and money on immigration processes because of exemptions offered by the government. Most workers require an LMIA (Labour Market Impact Assessment), but qualified owner operators get to avoid the process altogether.

Most business owners need to pass an LMIA before receiving authorization to hire foreign workers in Canada. Owner operators avoid a lengthy LMIA through an exemption for foreign nationals who seek to establish their business in Canada.

Labour Market Impact Assessment - A Barrier Worth Avoiding

Similar to many western countries, Canada enforces an immigration policy which invites talent and investment from around the globe. At the same time, these policies protect the Canadian labour market by selecting foreign workers who benefit the economy.

A Labour Market Impact Assessment must be completed for most positions when hiring talent from abroad. An LMIA shows that a work vacancy cannot be filled by a Canadian citizen or permanent resident. Since Canada features a world-class education and training system, most businesses find suitable applicants from within the country.

Some industries create a demand for specialized or highly-skilled work which exceeds the local labour supply. In these cases, employers may receive permission to hire employees from abroad. Before doing so, companies often submit to the LMIA process, which may involve posting the position on job boards and filling out lengthy applications.

This LMIA barrier may be avoided by owner operators who must be physically present for business functions. Instead of requiring an extensive labour market assessment, owner operator LMIA exemptions speed up the process. All business immigrants who qualify should pursue this strategic shortcut.

Why Do Owner Operators Qualify for LMIA Exemptions?

Canada designed the Labour Market Impact Assessment to prevent companies from hiring outside of the country when a Canadian citizen or permanent resident could fill the role instead. This type of policy ensures that businesses access international talent for vital roles. At the same time, LMIA prevents unemployment and stagnant wages due to a flood of foreign workers entering the market.

Since owner operators create jobs in Canada with their business investments, the government provides LMIA exemptions to simplify this type of immigration process. There’s no need to determine the impact of owner operators on the labour market - as long as the business creates jobs for Canadians.

How Does the LMIA Process Work for Owner Operators?

The most important difference between LMIA exemptions for owner operators and other occupations is the lack of advertising and recruiting required. One of the most significant hurdles for businesses looking to hire outside of Canada is the time and money needed to undergo a job search that proves a Canadian can’t fill the position.

Foreign workers typically must prove specific expertise or experience before filling a job in Canada. A job offer from the company is also necessary. Instead of following these steps, owner operators must prove their worth as employers instead of employees.

Those applying for owner operators exemptions must prove that they are financially capable of supporting a business on Canadian soil. In addition to personal financial information and legal documentation, owner operators must submit a business plan to the government.

This business plan must contain detailed financial planning and projections, along with proof such as lease agreements and other types of contracts which link the enterprise to Canadian soil. 

Since the goal of this exemption focuses on streamlining investment in Canada, the applicant must show that they will be able to create jobs for Canadian citizens or permanent residents. As such, a convincing business plan must accompany all the other legal documentation and proof submitted.

Over the last few years, the definition of owner operator has changed to narrow the field for LMIA applicants. The legal standing of owner operators no longer includes those who receive compensation in the form of shares. Instead, owner operators exemptions only include sole proprietors who own a clear majority of shares while controlling the company.

Owner Operator Exemptions and Permanent Residency

Owner operators win exemptions to strict LMIA requirements by proving that their entry into the Canadian market is feasible and financially sound. Some owners focus strictly on immigration as a means to ensure business expansion, content to grow their business before moving on to the next opportunity in a different country.

Many owners consider immigration to Canada as a great opportunity to enjoy a fantastic new lifestyle, which includes outstanding education and healthcare for family members. As such, immigrating is more than a great business opportunity for plenty of owner operators.

Obtaining permanent residency is not guaranteed just because an LMIA exemption is awarded. However, owner operators LMIA requirements happen to match many important qualifications for those who seek to live and work in Canada.

People who qualify for an owner operator exemption tend to have a far better chance of living in Canada with their families on a permanent basis, compared to other types of foreign worker programs. Foreign nationals who are interested in Canada's Business Immigration programs can have abundant choice in obtaining permanent residency through entrepreneurship and investment.

See our Business Immigration Simplified program for foreign investors and entrepreneurs.

Important Changes for Owner Operator LMIA Exemptions

Owner Operators Requirements

As of March 18th, 2019, the requirements for owner operator LMIA exemptions have changed. Employment and Social Development Canada released a statement which altered the minimum advertising requirements across dozens of categories.

For owner operators, the LMIA exemption is available for business owners only, which clarifies the situation for those who receive shares as compensation. The new law states that owner operators must:

  • Own controlling interest in the business:
  • Acts as the sole proprietor
  • Serves as a majority shareholder (with a minimum of 50.1% shares)
  • Provide official document to confirm you as sole shareholder with controlling interest
  • Show that you cannot be dismissed from your position

These clarifications apply across all provinces and territories. Similar to before, owner operators don’t need to advertise or recruit like other types of occupations seeking an exemption.

Express Entry Comprehensive Ranking System for Owner Operators

Prior to November 2016, earning an LMIA exemption as an owner operators would always qualify for an invitation to apply as a permanent resident. The comprehensive ranking system (CRS) for Express Entry has changed significantly since then.

Owner operators used to score 600 points in the CRS system, which would all but ensure a permanent resident invitation. After November 2016, the number of points awarded dropped to a maximum of 200. In some cases, owner operators receive as little as 50 points under the new guidelines.

This may sound like a harsh development, but owner operators still enjoy a much higher success rate for LMIA and other immigration processes, despite the change in points awarded. Business owners must focus on improving qualifications in other aspects of the immigration process, like language requirements, instead of relying strictly on business creation.

Electronic Travel Authorization (eTA)

The need for Electronic Travel Authorization (eTA) for some immigrants and travellers was one of the most significant changes to surprise people entering Canada over the last couple of years.

Not everyone landing in Canada needs an eTA, but those who require electronic authorization will be refused at the border - even if the rest of your immigration case was successful. As such, determining whether you need the eTA is a vital part of the process.

Fortunately, obtaining authorization is usually quick and inexpensive. Most applicants simply need to apply online and pay the $7 fee, resulting in an eTA in less than 15 minutes. In cases where additional documentation is needed, the ETA may require several days to complete.

An eTA will be linked to your passport number, which will be confirmed at check-in before your flight to Canada. Those who need an eTA will not be able to board the flight without authorization - a significant waste of time for owner operators who successfully navigated the rest of the immigration process.

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