Immigration Lines

Recent Amendments Eliminate Passive Investment from Provincial Nominee Programs

Effective September 2, 2008, the Immigration and Refugee Protection Regulations have been amended to clarify the provisions related to passive investment in provincial nominee programs.

Under the Provincial Nominee Program (PNP), provinces and territories can nominate individuals whom they consider to be important to their economic development. Under the terms of the provincial nominee agreements, provinces and territories are responsible for designing the criteria for their respective nomination categories, which can include business immigrants. However, the intent of the entrepreneurial component within the PNPs was to permit provinces and territories to nominate business people who would meet the specific demographic and economic objectives of the nominating provinces or territories by settling there and opening or investing in a business which they would actively manage on a day-to-day basis. Selection on the basis of the ability to invest capital without involvement in the management of the recipient business/organization has always been exclusive to the Federal Immigrant Investor Program. By making the recent amendments, Citizenship and Immigration Canada (CIC) is making it clear that it was never intended for province and territories to select passive investors under their PNPs.

The problem with the previous regulations was that they were worded in such a way that they allow the use of PNPs to attract passive investments in exchange for the promise of permanent residency. The previous wording suggested that any involvement, however minor, would satisfy the exclusion. It did not define a minimum level of involvement by the entrepreneur in the active management of the business in which they invest under the PNP.

A passive investment occurs when an individual invests capital in a business or organization without being actively involved in its management. This misuse occurred because the concepts "active management" and "immigration-linked investor scheme" were not sufficiently defined.

To remedy this problem, sections 87(5) and (6) of Immigration and Refugee Protection Regulations were amended to specify that foreign nationals cannot be considered members of the Provincial Nominees Class in cases where passive investment may arise. A foreign national is precluded from being considered a member of the Provincial Nominees Class, if the nomination was based on their provision of capital or their participation in an immigration-linked investment scheme.

More specifically, section 87(9) of Immigration and Refugee Protection Regulations defines "Immigration-linked investment scheme" to include any strategy or plan where:

• one of the objectives is to facilitate immigration to Canada;
• one of the objectives of the promoters of the strategy or plan is to raise capital; or
• the agreement or arrangement was entered into primarily for the purpose of acquiring status or privilege under the Act.

However, a foreign national may still be considered a member of the Provincial Nominees Class if:

• the capital provided to a business is not made primarily for the purpose of deriving interest, dividends or capital gains;
• the foreign national controls, or will control, at least 33 1/3 percent of the equity in the business, or has made a minimum $1 million equity investment in the business;
• the foreign national will participate actively, on an ongoing basis, in the management of the business; and
• the terms of investment in the business do not include a redemption option.

All applications for permanent residence in progress at the federal level prior to September 2, 2008 would be assessed according to the regulation in effect immediately prior to September 2, 2008, as would all nomination certificates issued on or before September 1, 2008. Applications with a nomination certificate issued on or after September 2, 2008 are subject to the new regulation.

Officers who have reason to believe that applicants, whose nomination certificates are issued after September 2, 2008, have been nominated on the basis of a passive investment, can proceed to interview the applicant and/or request additional documentation to satisfy the requirements under sections 87(5), (6) and (9) of Immigration and Refugee Protection Regulations.

The requirements to be a member of the Provincial Nominees Class and to economically establish in Canada always apply. If the nomination certificate is not a sufficient indicator that a foreign national can economically establish in Canada, an officer may substitute his evaluation of the likelihood of the ability of the foreign national to become economically established in Canada.

Inadmissibility – Grounds and Solutions

Under Canadian immigration law, there are a number of "grounds of inadmissibility" that may stand in the way of a foreign national successfully obtaining a visa or of immigrating to Canada to become a permanent resident. One such ground that often comes in the way of a successful visa or immigration application is commonly referred to as "medical inadmissibility". It is important for individuals who are thinking of visiting or immigrating to Canada to be aware of this ground as it may pose as a hurdle in your way (depending on yours or your family's medical condition) even if all other requirements are met. However, more importantly, it is useful to note that there are recent developments in the law that offer solutions for individuals facing inadmissibility or the possibility of inadmissibility based on this ground.

Medical Inadmissibility – Excessive Demand on Social Services

Under section 38(1) of the Immigration and Refugee Protection Act ("IRPA"), a foreign national is inadmissible on health grounds if his or her health condition might reasonably be expected to cause excessive demand on health or social services in Canada. An "excessive demand" is a demand for which the anticipated costs exceed the average Canadian per capita health and social services costs, which, according to a recent Operational Bulletin issued by Citizenship and Immigration Canada, is currently $4,806 per year. Under section 42 of IRPA, a family member of an applicant may be inadmissible for the same reason. The procedure for such a determination works as follows:

• If a medical officer thinks that a given individual or his or her family member might reasonably be expected to cause an excessive demand on social services in Canada, a Procedural Fairness Letter is sent to the individual citing the following: (1) the medical condition or conditions that have been identified; (2) a list of social services required to address the condition or conditions; and (3) a list of the respective cost implications for the identified social services;
• Following such a determination by a medical officer, the letter sent by an immigration officer also offers the applicant a chance to submit additional information for overcoming the finding of inadmissibility within a given time frame;
• If the applicant does not respond to the letter or provide additional information, the application is processed on the basis of existing information, which likely means that the person is inadmissible;
• If the applicant does respond by challenging the assessment and by submitting additional information, but without declaring an ability and intention or plan to mitigate the excessive demand on social services, the medical officer has three choices: (1) to maintain the original medical assessment; (2) to review the new information and issue a new assessment of inadmissibility; or (3) to determine that the applicant is no longer inadmissible;
• If the applicant does respond and declares that he or she has the ability and intention to mitigate the excessive demand on social services, Citizenship and Immigration officers must consider this information in making their inadmissibility decision and an opinion is rendered by the immigration officer based on a review of the same.

How Can We Help?

Pursuant to rules of procedural fairness followed in the immigration application process, and developments resulting from recent Supreme Court of Canada and Federal Court of Canada decisions, an applicant who is medically inadmissible in the opinion of a medical officer has a chance to respond and present his or her view about a determination of medical inadmissibility or excessive demand and to offer evidence of both intention and ability to mitigate excessive demand concerns. Accordingly, it is important to know your rights and to know what information and documentation may be submitted in an attempt to overcome an assessment of excessive demand. In this regard, we can help with the following:

• Drafting a response to a Procedural Fairness Letter;
• Drafting submissions and/or assisting with the preparation of Declarations of Ability and Intent in order to mitigate and reduce the impact on Canada's social services;
• Advising on the burdens to meet if the plan is to receive non-financial assistance from a family member versus purchasing private-sector social services;
• Advising on factors that will be considered by Citizenship and Immigration Officers in assessing submissions; and
• General assistance throughout the application process.

U.S. Increases Period of Stay for TN from 1 Year to 3 Years

On October 15, 2008, U.S. Citizenship and Immigration Services (USCIS) published its final rule to increase the maximum period of stay that a Trade-NAFTA (TN) professional worker from Canada or Mexico may remain in the United States before seeking readmission or obtaining an extension of stay. This final rule changes the initial period of admission for TN workers from one (1) to three (3) years, making it equal to the initial period of admission given to H-1B professional workers.

Eligible TN applicants may also be allowed to receive extensions of stay in increments of up to three years instead of the prior maximum period of stay of one year.

The TN nonimmigrant classification is visa category available to eligible Canadians and Mexicans with at least a bachelor's degree or appropriate professional credentials who work in certain qualified fields pursuant to the North American Free Trade Agreement (NAFTA). Qualified professions identified within NAFTA include, but are not limited to, accountants, engineers, computer system analysts, management consultants, scientists, and teachers.

We expect this final rule to be well received as it will ease burdens and costs on TN workers. Spouses and unmarried minor children of TN non-immigrants in their corresponding nonimmigrant classifications will also benefit from the new regulation.

Criminal Inadmissibility – Determining Equivalencies

Foreign nationals are inadmissible on grounds of criminality if they have been convicted of an offence that constitutes or would constitute an offence in Canada if committed here. Criminal offences in Canada can be divided into three categories: (1) summary; (2) hybrid; and (3) indictable offences. Among other situations, if an individual has committed an offence that would be considered an "indictable" offence in Canada or two or more summary offences, that person would be inadmissible. Moreover, if a person has been convicted of an offence that would constitute a "hybrid" offence, under Canadian immigration laws, such offences are deemed to be "indictable" offences for the purpose of assessing criminal inadmissibility.

If a foreign national wishing to come to Canada committed an offence outside of Canada, one factor considered in the assessment of whether the individual has committed an "indictable" offence or a less serious "summary" offence is "equivalency". "Equivalency" refers to the process of equating offences committed outside of Canada to offences in Canada in order to determine whether a particular offence committed outside of Canada would constitute a summary, hybrid or indictable offence. A review of an Operational Bulletin issued by Citizenship and Immigration Canada on this topic offers some guidance and insight into the method of analysis followed by Citizenship and Immigration Officers in determining equivalencies.

In particular, one of three approaches may be taken by the officer examining the rehabilitation application when determining equivalency:

• an examination of the elements of the Canadian and foreign statutes to determine if both have the same essential requirements to substantiate the respective offence; or
• an examination of the facts to determine whether there was sufficient evidence before the court to substantiate each of the elements required for the Canadian offence; or
• a combination of the two methods above.

As such, it is important to have a clear statement of all the facts surrounding a given offence as well as the relevant foreign statutory provisions under which an individual was charged. In particular, the following information would be helpful and, in most cases, required:

• Criminal record of conviction;
• Statute and section number of conviction;
• Translated copy of the section or the statute at issue (if applicable);
• Disposition: finding of guilt, conviction, acquittal, discharge, stay, pardon;
• Where possible, the factual background of the offence (court transcripts or police reports) and the sentence; and
• Objective confirmation of the facts through court documents.

Determining equivalency is essential in cases involving criminal inadmissibility and in submitting rehabilitation applications. This involves an analysis of the offences in question and the provisions of applicable legislation and regulations. The foregoing discussion provides general guidance on the kinds of documents and information required in such a process, but proper legal advice should be sought in any given case in order to ensure all the requirements of the equivalency process are met.

Olympic Update No. 11 – BC's Bill for 2010 Will Exceed Budget

The cost to British Columbia of hosting the 2010 Olympic Games will likely exceed the $600 million the Province budgeted for the event.

Finance Minister Colin Hansen has advised that rapidly rising security costs are eating into a healthy contingency in BC's overall Olympic budget and the Province can no longer guarantee it is adequate.

The only way BC will be able to stay within budget is if it can whittle down costs the Federal Government wants to assign to it under a new security budget drafted by the RCMP-led Vancouver 2010 Integrated Security Unit.

According to Federal Public Safety Minister Stockwell Day, the total cost of securing the Games – originally tabbed at $175 million – is now expected to climb to between $400 million and $1 billion.

The $600 million that had been budgeted to be spent on the Olympic Games was supposed to cover all of BC's costs, from its half of the venue construction budget to the operation of its 2010 Secretariat, to money for legacy endowments, celebration sites, security, the Paralympic Games, first nations legacies and other provincial commitments.

The $600-million budget included a $139.5-million contingency, which Hansen said has now dwindled to about $76 million.