Entry of business persons to Canada under CUSMA
Effective July 1, 2020, the North American Free Trade Agreement (“NAFTA”) was officially replaced by the Canada-United States-Mexico Agreement (“CUSMA”). Like NAFTA, CUSMA contains provisions for the temporary entry of foreign “business persons” to Canada in certain cases. These provisions remain unchanged under CUSMA, but are summarized below as a refresher.
Application of CUSMA
CUSMA includes provisions regarding the temporary entry of certain business persons to Canada, but does not deal with permanent residence. To be eligible, business persons must be citizens of the United States (including US citizens of the District of Columbia and Puerto Rico) or Mexico. CUSMA does not apply to permanent residents of these countries, nor does it cover citizens of Guam, the Northern Mariana Islands, American Samoa, or the US Virgin Islands.
Further, any business persons seeking entry under CUSMA must be involved in trade of goods or services. Alternatively, investment activities are also covered in some cases.
CUSMA provides for the following categories of business persons:
- Business visitors – Individuals who are able to enter Canada for business purposes and carry out activities without work permits (see below).
- Professionals – Individuals who are professionals, like engineers, architects and computer systems analysts, and who will be providing pre-arranged professional services in Canada. CUSMA Professionals do require work permits.
- Intra-Company Transferees – Individuals who are employed in certain types of capacities with an American or Mexican enterprise and who are being transferred to the Canadian parent, branch, subsidiary, or affiliate to work in the same capacity. CUSMA Intra-Company Transferees do require work permits.
- Traders and Investors – Individuals who carry on substantial trade in goods or services between the United States or Mexico and Canada or individuals who have committed (or will commit) a substantial amount of capital in Canada. CUSMA Traders and Investors do require work permits.
With respect to the three categories of business persons requiring work permits, CUSMA allows these individuals to bypass the Labour Market Impact Assessment (“LMIA”) process with Service Canada and obtain an LMIA-exempt work permit. This also means the employer will not have to undergo the recruitment process (i.e. four weeks of advertising for the role to find suitable and available Canadians or permanent residents) that Service Canada typically requires for the LMIA process. In other words, these LMIA-exempt CUSMA permits can often be obtained in a more timely manner than LMIA-based work permits.
Also note that while the business visitor category does allow entry to Canada for business purposes without a work permit, applicants should be sure to seek advice on whether they in fact are likely to be considered business visitors. Otherwise, they may be denied entry, inadvertently work without proper authorization, or even face misrepresentation allegations if they improperly characterize their work in the business visitor category.
Typically, business visitors are individuals engaging in certain activities that are international in scope who have no intent to enter the Canadian labour market. Their primary source of remuneration and principal place of business remain outside of Canada despite their physical location in Canada for said business activities. Relevant business activities can include research and design, some sales and marketing work, after-sales service and similar.
Duration of entry
Under CUSMA, the duration of entry allowed (or duration of the work permit issued, where applicable), will vary from category to category, and may be possible to extend. However, CUSMA categories are once again intended for temporary entry only, and are not intended to provide a route to bypass the permanent residency application process.
Our immigration group would be pleased to help you, your employee, or any business person requiring entry to Canada in relation to your business to assess options for entry under CUSMA or otherwise.
This update is intended for general information only. If you have questions about the above, please contact a member of our Immigration Group.
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