Canada Introduces Open Work Permits for Start-Up Visa Candidates, But There’s a Catch

Moustafa Daly
Cairo

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Canada has unveiled new provisions for its Start-Up Visa (SUV) program, offering open work permits to entrepreneurs awaiting permanent residency.

The changes, took effect on October 3, depart from the former closed work permits policy, which restricted candidates to working solely on their SUV-related ventures.

Under the new guidelines, SUV candidates can now apply for a three-year open work permit. This permit allows them to supplement their income by working for almost any employer in Canada while building their start-up businesses.

Christopher Lennon, President & General Counsel at Empowered Startups, sees the change as a necessary evolution of the program.

He says that when the government launched the SUV program in 2013, its intention was to process permanent residency (PR) applications within six months. Based on that timeline, Lennon explains, a one-year closed work permit was “more than adequate” to enable entrepreneurs to launch in Canada before receiving their PR.

However, as processing times increased to 24 months and beyond, “critical flaws” in the closed work permits policy became apparent.

Lennon explains how the policy backfired, as an SUV entrepreneur in Canada on a closed work permit who the government restricts to working only on their SUV-related business opportunity can “arguably be working illegally if they invest in another business with any sort of employment-like activity while in the country on a closed work permit.”

He notes that the closed work permit policy prevented SUV entrepreneurs from doing what they do best; finding opportunities and starting new businesses.

The new open work permit framework addresses this issue by allowing entrepreneurs the flexibility to explore multiple business opportunities without risking their immigration status.

“A complex balancing act”

While the open work permit offers greater flexibility, the policy shift is not without complexities. Melissa Godmer, Founder of Godmer Immigration Consultant, highlights a potential hurdle in the new process. She explains that investors must obtain an Acknowledgment of Receipt (AOR) from the government before applying for the work permit, a matter that “introduces significant delays.”

She says this process can stretch from “several months to over a year,” and that it could “deter new applicants and frustrate those eager to start their businesses quickly in Canada.”

Lennon reiterates the same concern because it often takes “about 16 months to receive an AOR, so launching from abroad will now become critical.” He says that because PR processing times are decreasing, it is “quite likely” that an SUV entrepreneur may receive their first open three-year work permit at about the same time that IRCC reaches out for an update on the progress of the business as part of its PR issuance process.

Due to the complexity of navigating the new changes, Lennon says it has become “critically important” for SUV applicants to achieve “appreciable progress” regarding launching their business, “even before receiving their first work permit.”

This additional step in the application process may inadvertently compromise the program’s competitiveness, cautions Godmer. While the open work permit may attract more entrepreneurs, the timeline for obtaining an AOR could narrow the pool of viable candidates.

She says that the changes “reflect a complex balancing act; striving to enhance the attractiveness and accessibility of the SUV program while managing operational and regulatory challenges.”