Yes, a person who is neither a Canadian citizen nor a permanent resident may incorporate a company in Quebec and be its sole shareholder. What makes the difference is the choice of statute, the timing of the incorporation, and how the structure documents your immigration project.
Can you incorporate without permanent status in Canada?
No Canadian business corporations statute requires shareholders to be citizens or permanent residents. The constraint, where it exists, applies to directors, and it depends on the statute chosen.
Quebec’s Business Corporations Act imposes no residency requirement on directors. A board made up entirely of people living abroad is therefore possible. The Canada Business Corporations Act instead requires at least 25 % of directors to be Canadian residents, or at least one director where the board has fewer than four.
Under the federal Act, the holder of a work permit is not a Canadian resident. Only citizens and permanent residents ordinarily resident in Canada qualify.
Quebec or federal: the comparison for a foreign director
| Criterion | QBCA (Quebec) | CBCA (federal) |
|---|---|---|
| Director residency | No requirement | 25 % Canadian residents, or at least one where the board has fewer than four members |
| Head office | In Quebec | In Canada, in the province named in the articles |
| Quebec registration | Done on incorporation, with a Quebec enterprise number | Separate registration with the enterprise registrar in order to carry on business in Quebec |
| Annual filings | Quebec enterprise registrar | Corporations Canada and the Quebec enterprise registrar |
Our reading: for an entrepreneur whose activity will be carried on in Quebec and whose board will initially consist of people without permanent status, the Quebec statute is generally the simpler route. The federal statute keeps its appeal for a pan-Canadian project, provided a Canadian-resident director is appointed, who then takes on personal liability. The choice is covered in our piece on federal or provincial incorporation.
The right moment depends on the program
In the Start a business stream of the Entrepreneur Program, Business start-up profile, an applicant who meets every condition except the start-up itself and the spending receives a notice of intent to select. That notice allows a work permit application to the Government of Canada.
To then obtain the Quebec Selection Certificate, the applicant must show four things: an actual start-up no later than two years after the work permit is issued; a business registered for at least one year when the evidence is sent; start-up or operating expenses of at least $300,000 in the Montreal metropolitan community, or $150,000 elsewhere in Quebec; and a holding of at least 25 % of the contributed capital, alone or with the spouse included in the application.
The one-year registration period and the two-year deadline therefore run in parallel. Incorporating shortly after the permit is issued usually leaves a comfortable margin. Incorporating well before the application is not prohibited, but the company, its expenses and its capital must then match the business plan exactly.
In the Business takeover stream, the applicant must acquire control of a business operating for at least five years, alone or with the person included in the application as a spouse. Where the acquisition runs through a holding company, the chain of ownership must establish that control without ambiguity.
Contributed capital is proved with corporate records
The Ministry assesses your share of the contributed capital, and that proof rests on the quality of your corporate records. In practice, for each client we prepare:
- articles whose share classes reflect the split announced in the business plan;
- issuance resolutions stating the consideration received for each share;
- an up-to-date securities register;
- traceable proof of payment, consistent with the demonstration of the lawful origin of your net worth.
An incomplete minute book does not make a project ineligible, but it makes the demonstration far harder to defend.
The Investment Canada notice, often forgotten
A non-Canadian who establishes a new Canadian business, or who acquires control of an existing one, must file a notice under the Investment Canada Act. The notice is filed before the investment is made or within the following 30 days. An entrepreneur holding a work permit is a non-Canadian under that Act.
The company name and the Charter of the French language
The enterprise registrar refuses names that do not comply with the Charter of the French language. A name containing an expression in another language must be accompanied by a French generic term, such as « Services », « Consultation » or « Technologies ». Validate the name before ordering signage, a website and presentation materials: a refusal after the fact costs time and money.
The practical details that delay files
The head office
Plan an address in Quebec for the head office and official correspondence.
A convenience address that never receives mail always ends up costing a delay.
The bank
Financial institutions apply strict identity checks to non-resident directors.
Allow several weeks, and start as soon as the company exists.
Tax registrations
GST and QST depending on your activity, then source deductions from the first hire.
See our piece on sales tax registration.
Tax planning
Tax residence of the company and the shareholder, how you will be paid, ownership structure.
These choices are validated with an accountant before incorporation, not after.
How MEKA AVOCAT works on this
Our firm works at the crossing of business law and immigration. Before incorporating, we read the conditions of the program with you and align the articles, the capital structure and the minute book with your business plan. We prepare the incorporation, the organizational resolutions, the shareholders’ agreement where there are partners, and the Investment Canada notice, in coordination with our accounting and tax partners.
A well-built company does not replace a sound project. If your project does not fit the program, we will say so before you spend.
Texts and sources
This article draws on the Business Corporations Act (Quebec), the Canada Business Corporations Act, the Investment Canada Act, the Charter of the French language and the official Entrepreneur Program pages published by Quebec’s immigration ministry.
Frequently asked questions
Can a foreign national be the sole shareholder and sole director of a Quebec company?
Yes. Quebec’s Business Corporations Act imposes no residency requirement on directors.
Does incorporating give me the right to work in Quebec?
No. Incorporation confers no status. Authorization to work comes from a permit issued by the Government of Canada.
Must I incorporate before filing under the Start a business stream?
Not necessarily. In the Business start-up profile, the actual start-up is demonstrated after the work permit obtained through the notice of intent to select.
Do I need a Canadian director?
Under the Quebec statute, no. Under the federal statute, at least 25 % of directors must be Canadian residents, or at least one where the board has fewer than four members.
A business project in Quebec, without permanent status?
A first meeting confirms the program involved, settles the choice of statute and sets the order of operations between the corporate stream and the immigration stream.
Next: the Start a business stream, calculating and proving net worth, and our work on starting a business.
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Lawyer, member of the Barreau du Québec since 2014, founder of MEKA AVOCAT. This text sets out general legal information: it describes rules that apply broadly, not the answer to a particular case, and does not replace advice on your own situation.
