Canada

Investing

FDI in figures

Foreign direct investment in Canada grew three times as fast as Canadian direct investment abroad in 2005, principally because of the appreciation of the Canadian dollar which caused the value of existing investments abroad to drop and thanks to political stability. This growth can be attributed mainly to acquisitions and injections of funds by parent companies into the working capital of their Canadian subsidiaries.

Foreign Direct Investment	2004	2005	2006
FDI of inward flow (millions USD)	-364	28,922	69,041
FDI inward stock (millions USD)	n.c.	n.c.	385,187.0
Performance Index*, world ranking	106	107	79
Potential Index**, world ranking	4	4	n.c.
Number of Greenfield investments	224	205	177
FDI inwards (in % of GFCF)	-0.2	12.3	25.3
FDI stock (in % of GDP)	n.c.	n.c.	30.4

Source: UNCTAD, World Investment Report

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk.

Why you should choose Canada

Strong points

Canada is one of the best business destinations in the G7. A strong and dynamic economy. Low tax rates for companies. Lowest social contribution rates in the G7.

Weak points

Very high level of unionization.

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 and Costa Rica in July 2007.

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.

Administrative 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.