CETA Explained - Comprehensive Economic Trade Agreement

October 2017

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What is CETA?

The Comprehensive Economic Trade Agreement (CETA) is a free trade agreement between Canada and the European Union (EU). Its purpose is to promote economic growth between the two parties. CETA was signed off and ratified by Canada and the 28 EU members on September 21, 2017.

What does CETA cover?

CETA covers all Canada-EU trade matters including: tariffs, investments, professional/educational certification and labour mobility for facilitated entry for workers and business visitors.

From a mobility perspective there are three categories covered:

1. Intra-company transferees and investors – All intra-company employees must have been employed or been a partner of the company for at least a year, and that company must have an office, division or branch in Canada.

The applicant must fall under one of the categories listed below:

  • Sr. Personnel & Specialists – Intra-corporate transferees and specialists may be provided with a work permit for three years or the length of the contract, whichever is less, with a possible 18 month extension.
  • University Graduates - Intra-corporate graduate trainee transferees are eligible for a 12 month work contract or the length of the contract, whichever is less. To qualify, the candidate must be temporarily transferred to a Canadian branch or office to further their professional development or to obtain specialized training.

2. Independent Professionals and Contractual Suppliers

CETA provides a list of applicable service sectors that fall under this category, which is broader then the NAFTA list, and is exempt from the otherwise mandatory Labour Market Impact Assessment (LMIA). Independent professionals and contractual suppliers who are eligible for work permits are allowed to work on both sides of the Atlantic for up to 12 months. Professions that are eligible include: Legal Advisory Services, Accounting, Architectural Services, Engineering and other consultants, who have the required professional or educational background in their industry.

Contractual suppliers must have been an employee of the EU-headquartered business for at least one year and possess three years of professional experience in the sector of activity they are providing. The contractual supplier must be actively providing a service on a temporary basis as an employee to the business that has obtained a service contract to a Canadian client.

A self-employed or independent professional who has a contract to provide a service to a Canadian business must be engaged in the supply of a service on a temporary basis as a self-employed person and possess at least six years of professional experience in the sector of activity which is the subject of the contract.

3. Business Visitors

Under CETA, there are two types of business visitors: short-term business visitors and business visitors for investment purposes. The maximum amount of time which these types of visitors are allowed to stay for investment purposes is 90 days in any six month period, if the applicant does not qualify under the standard business visitor definition as per Regulations 186(a) and 187. Permissible activities under CETA include: meetings and consultations, research and design, marketing research, training seminars, trade fairs and exhibitions, sales, purchasing, after-sales or after-lease service, commercial transactions, tourism personnel and translation and interpretation.

Short-term business visitors are not allowed to engage in any type of transaction involving the sale of goods or services to the general public, they may not receive remuneration directly or indirectly from a Canadian source, and are prohibited from engaging in the supply of services.

CETA also has a provision for the temporary entry of business visitors for investment purposes. A business visitor for investment purposes is an employee in a managerial or specialist role who is responsible for the setting up a business but who does not engage in direct transactions with the general public and will not receive direct or indirect remuneration from a Canadian source.

For EU citizens, CETA creates new opportunities to work and invest in Canada through new work permit categories. Canadian businesses will also gain great benefits as CETA allows Canadian companies the ability to more easily contract with EU workers.

For more information regarding the CETA changes, please contact us directly.

Learn more about BDO's corporate immigration services.