INVESTMENT
INTRODUCTION
There are four primary ways for foreign nationals to invest in Canada:
1. Purchasing a franchise business
2. Acquiring an interest in a privately owned company
3. Investing in real estate properties
4. Launching a new business venture
The most appropriate option depends on your industry experience, investment goals, and available capital. Based on these factors, we can introduce suitable business or property investment opportunities tailored to your interests.
In many cases, foreign investors can acquire up to 70% ownership of a Canadian corporation. The remaining 30% must typically be held by a Canadian citizen or permanent resident. This requirement may vary depending on the industry and structure of the business.
Below are illustrative examples of each type of investment (with accompanying visuals):
– Franchise businesses
– Privately owned companies
– Real estate investments
– Startups
FRANCHISE VS. PRIVATELY OWNED BUSINESS
Key Features of Franchise Businesses
– Monthly royalty fees typically apply. These often include:
– 3–4% for national marketing
– 6% for franchise royalties
– Buyers must review and sign a Franchise Disclosure Document (FDD), which outlines the franchisor’s obligations and business terms.
– Prospective franchisees undergo a pre-qualification process to assess eligibility and alignment with the brand.
– Franchisors provide an Operations Manual, which includes standardized procedures, employee training resources, and operational guidance for new franchise partners and staff.
Business Purchase Methods
There are two common approaches to acquiring a business in Canada:
1. Asset Purchase
– A new or existing Canadian corporation purchases the tangible and intangible assets of the target business.
– This structure typically excludes any of the seller’s existing debts or liabilities.