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Canada's immigration minister, Chris Alexander. Photo: Jonathan Wong

Canada’s new millionaire migration scheme will be tiny, costly and strict

Scheme to take 50 applicants per year seems intended to deter rich Chinese and is 'ridiculously’ restrictive, says leading HK immigration lawyer

Canada has unveiled a keenly anticipated millionaire migration scheme to replace its defunct immigrant investor programme - but with rules so tight and an intake so small it will thwart all but a handful of the 45,000 rich Chinese who were dumped from the old scheme’s queue.

Immigration minister Chris Alexander on Tuesday announced that the intake for the new Immigrant Investor Venture Capital (IIVC) scheme would only be about 50 immigrants and their family members per year, confirming a December 4 report by the South China Morning Post.

Prominent Hong Kong immigration lawyer Jean-Francois Harvey said the scheme was so restrictive as to be “totally ridiculous”.

Alexander said the pilot programme, which opens for applications next month, would require immigrants to hand over an investment of C$2 million for a period of 15 years, and that they be able to demonstrate minimum net worth of C$10 million. They would also have to submit to an audit to demonstrate that their wealth was a result of “lawful, profit-making business activities”, Citizenship and Immigration Canada said in a statement.

“Immigrant investors will be required to meet certain program eligibility criteria related to language and education, and have proven business or investment experience,” the CIC statement said. “This will ensure that immigrant investors will have a strong impact on the Canadian economy, and that those admitted for permanent residence will be well prepared to integrate into the Canadian business landscape and society.”

The new rules are much more strict than those governing the former immigrant investor programme, which was shut down in June, resulting in the scrapping of 60,000 pending applications, most of them from Chinese millionaires.

“While I know they will get their 50 cases a year, it is a totally ridiculous programme,” Harvey, managing partner of the Harvey Law Group, said of the new scheme.

“The requirement of knowing one of the official languages is a not-so-subtle way to say ‘no’ to 95 per cent of the applicants from China,” he added.

Under the old scheme, immigrants only had to loan the government C$800,000 interest free for five years, and display minimum net worth of C$1.6 million.

The IIP brought more than 180,000 wealthy immigrants to Canada since 1986, including at least 30,000 rich Hongkongers ahead of the 1997 handover.

But in February, the South China Morning Post reported that the scheme had spiralled out of control, thanks to an influx of thousands of applications lodged at Canada’s consulate in Hong Kong by mainland Chinese millionaires. Ottawa announced less than a week later that it would shut down the 28-year-old scheme.

The C$100 million that Canada hopes to raise in the first year of the IIVC scheme will be used “to seed innovative Canadian start-ups with high growth potential” the CIC statement said. Immigrants who join the scheme will risk losses to their C$2 million investments, unlike participants in the IIP whose C$800,000 loans were returned in full.

Vancouver immigration lawyer Richard Kurland said while it was possible some immigrants may “hit the jackpot” with their C$2 million investments, others would be left with nothing. “With a 15-year ‘hold’ …My recommendation to applicants would be to consider the C$2 million gone,” he said.

The IIP was widely criticised for allowing rich people to buy their way into Canada and secure a passport, without contributing greatly to the economy or society. “Research indicated that immigrant investors [under the IIP] were less likely than other immigrants to stay in Canada over the medium to long term,” CIC said.

The IIP was also seen as having an outsized impact on the city of Vancouver and its sky-high real estate market, with about 37,000 investor immigrants arriving in British Columbia from 2005 to 2012. The city is the preferred destination of most rich Chinese immigrants to Canada.

“Our government is focused on building an immigration system that meets Canada’s economic and labour market needs’” Alexander said on Tuesday. “Through the launch of this pilot program, we are attracting investors who can make a significant investment and who have the education and proven business or investment experience necessary to achieve success in Canada.”

A Canadian immigration industry source said  he doubted whether many of the would-be immigrants dumped from the IIP queue would find their way to Canada, under the IIVC, or any other scheme. “My sense is that you’ll see a trickle, a few of them, who will continue to look at Canada, but the options are relatively few. The rest will opt for other countries,” he said.

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