On October 3, 2024, Immigration, Refugees and Citizenship Canada (IRCC) released significant policy updates for work permit applications filed under the International Mobility Program (IMP), and specifically, the Intra-Company Transfer (ICT) categories. The updated guidance sets out revised and more restrictive requirements for businesses and foreign workers to qualify for an ICT work permit.
It is important to note that the legislative basis for the ICT categories is found under Regulation 204(a) and Regulation 205(a) of the Immigration and Refugee Protection Regulations (IRPR):
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- R204(a) applies where Canada has an international free trade agreement with another country, which includes an intra-company transfer provision (for example, the Canada United States Mexico Agreement).
- R205(a) applies to all foreign nationals meeting the intra-company transfer criteria provided their transfer to Canada will create of maintain significant social, cultural or economic benefits or opportunities for Canadian citizens or permanent residents.
While IRCC’s October 3rd policy update encompassed revisions for the application of ICT criteria under both Regulations, changes did not apply equally across both. Therefore, in the summary of changes below we have specified which ICT categories they apply to.
Updated Eligibility Criteria for Intra-Company Transfers
The new guidance made the following updates to eligibility criteria for ICTs:
1. Position outside of Canada must remain available (R204(a) and R205(a)): the application must demonstrate that the foreign national’s position with the enterprise outside of Canada will remain available to them throughout their period of employment in Canada such that they might return to their position at the end of the assignment in Canada.
2. Reinforces a strict application of specialized knowledge (R204(a) and R205(a)): The policy has provided more guidance to IRCC officers who are assessing whether an applicant holds specialized knowledge. It must be clear that the employee holds both advanced proprietary knowledge and an advanced level of expertise. Specialized knowledge is knowledge that is unique and uncommon among the enterprise’s general workforce, and can therefore only ever be held by a small number of a given enterprise’s employees. Specialized knowledge workers must therefore demonstrate that they are key personnel with unique product knowledge or skills, not simply highly skilled.
3. Movement between ICT categories (i.e. from a specialized knowledge worker to a manager) (R204(a) and R205(a)): The policy clarifies that a foreign worker may only qualify under multiple ICT categories during their time in Canada if they worked for one year in the last three as a specialized knowledge worker, and one year in the last three in a managerial capacity, before their initial transfer to Canada. If an enterprise transfers their employee to Canada as a specialized knowledge worker, and prior to their transfer the foreign national never worked as a manager for one year in the past three, they would not be eligible to extend their work permit to perform a managerial function in Canada, even if the Canadian enterprise wishes to promote them to a managerial role as a natural career progression. The employee does not meet the ICT senior managerial criteria because they did not hold a managerial position outside of Canada for at least one year in the three years preceding the initial transfer.
4. Location of employment and remote work in Canada (R205(a)): ICTs must work at the physical commercial premises where business operations are conducted in Canada. Businesses with no physical commercial premises (i.e., businesses operating from non-commercial/residential locations, co-shared premises, virtual businesses using a mailing address in commercial locations) are not eligible to receive ICTs in Canada. In the case of ICT Start-Ups, there may be circumstances where the business location is held in the legal representative’s office until the foreign worker arrives in Canada to establish the business. Finally, IRCC has emphasized that if work can be done remotely, a reasonable explanation must be provided as to why the foreign worker must be in Canada. This policy indicates that the time difference between Canada and the foreign worker’s location will not be accepted to justify the transfer. Although this update was only made for ICTs under R205(a), similar criteria is likely to be applied under R204(a) as businesses must demonstrate how the transfer will result in a significant benefit to Canada, which can be more difficult for remote workers.
5. Using the ICT Work Permit Category to start a new enterprise in Canada (ICT Start Up Work Permit) (R205(a)): whereas the language under R204(a) has remained the same (i.e. the foreign national must be currently employed by an enterprise outside of Canada that has a qualifying relationship with the Canadian enterprise), the language has been revised for R205(a) to require that the foreign national must be currently employed by a multinational corporation (MNC). An MNC is a company that has business operations in at least one country other than its home country that generates revenue beyond its borders. Because R205(a) applies to transfers of foreign nationals from countries that do not have a free trade agreement with Canada, this change restricts companies from transferring such foreign nationals to establish their first foreign enterprise in Canada. To use the ICT Start Up Work Permit category under R205(a), the enterprise outside of Canada must be an existing MNC (i.e. must already have revenue generating operations in at least two countries). In other words, the enterprise cannot become an MNC by using the ICT work permit category to establish their first foreign enterprise in Canada.
Wages
Although meeting prevailing wage has always been mandatory for specialized knowledge workers under R205(a), under R204(a) it has not. Nonetheless, officers have always been instructed by IRCC’s policy to take wage into account for specialized knowledge workers under R204(a) as it is still an important indicator of specialized knowledge, and if a foreign worker is being paid significantly less than prevailing wage this could have led to a denial of the ICT Work Permit. There was previously no instruction for prevailing wage applying to executives or senior managers.
Under the new policy the language has been revised for all ICT categories (i.e. specialized knowledge workers, senior managers and executives) to instruct officers to “confirm that the wages are reasonable for the occupation. To prevent wage suppression, wages should not be lower than prevailing wage for the occupation in the location of work.” As such, we anticipate that Officers may be looking more closely at the wages in their eligibility assessments and checking whether they are at or above prevailing wage for all categories.
If your business is looking to transfer foreign workers to Canada, please contact Green and Spiegel for more information.
