FDI in figures

In the last decade, foreign direct investment in Canada grew three times faster than Canadian direct investment abroad, mainly because of the appreciation of the Canadian dollar, which decreased the value of existing investments abroad and also due to the country's political stability. However, the financial crisis has had a negative effect on Canadian appeal and consequently the flow of investments should decrease until 2011.

Why you should choose to invest in Canada

Strong points

Canada's main advantages are a qualified workforce and an easy access to raw materials. It is one of the most dynamic economies in the world, with a market of 30 million consumers and sophisticated infrastructures, as well as a very modern transportation network.

Weak points

Canada's weak points are its excessive dependance to the United States and a currently damaged financial system.

Government measures to motivate or restrict FDI

Canada applies a high taxation rate on companies. It is currently the country that applies the lowest payroll taxes in the G7 countries.
Companies establishing their headquarters in Canada should get tax benefits (higher than those offered in the United States) up to 2010 . In addition, the government announced a euro 24.6 billion two-year recovery plan.

Bilateral investment conventions signed by Canada

On 1 June 2007, Canada had signed bilateral agreements with more than 25 countries. See the list of the countries.
To see the conventions, click here.
Canada is a signatory to agreements and arrangements with more than 70 bilateral partners in the aviation sector.

 

It has concluded FTAs with the United States and Mexico (NAFTA), as well as with Chile, Israel, Costa Rica in July 2007 and Panama in August 2009 (elimination of tariffs in sectors of industry, agriculture, forestry and fishing).

Canada, Peru and the countries of the European Free Trade Association (EFTA: Iceland, Liechtenstein, Norway and Switzerland) signed a free trade agreement on 26 January 2008 at Davos, in Switzerland.

Procedures relative to foreign investment

Freedom of establishment

Yes, on condition that the company follows the directives required by the Canadian government.

Foreign investment is subject to the Investment Canada Act.

Acquisition of holdings

Possible on condition of observing the in-depth procedure of examination of the project.

Obligation to declare

The foreign investment promotion bureau in the country gives information about the necessary authorizations for setting up a company. Canada is in the first rank of OECD countries as regards the low number of procedures (2) and the shortest time limit (3 days) imposed for setting up an industrial or commercial company. A foreign company can set up in Canada by creating a distinct legal entity or a subsidiary under Canadian federal law or a provincial law governing companies. A subsidiary is treated in the same way as a branch office. It must have a commercial permit or be registered with the province where it does business.

Competent organization for the declaration

Investment Canada
Citizenship and immigration Canada - Guide 4000

Requests for specific authorizations

There are particular restrictions in the communications and transport sectors. All requests must be sent to the Ministry of Foreign Affairs.
For further information, see investment laws in Canada.

Finding assistance for further information

Investment aid agency

Business Development Bank of Canada
Foreign Affairs and International Trade Canada
Invest in Canada

Other useful resources

Investissement Québec (Investment Quebec)
Ontario Immigration - doing business
Manitoba Trade and Investment
Investment in the community support programs
Invest in Alberta
Invest in British Columbia
Invest in New Brunswick
Invest in Nova Scotia
Invest in Prince Edward Island
Invest in Newfoundland and Labrador