H&CO
Canada

Which business structures are available in Canada and what are their implications?  

Canada offers multiple business structures: sole proprietorships, partnerships, corporations, and co-operatives. Each has unique implications for liability, governance, taxation, and compliance. Understanding the regulatory and operational differences is essential to choosing the right form.  

What taxes, duties, and levies should foreign businesses expect when entering Canada?  

Foreign businesses must navigate several tax and duty regimes: GST, potentially combined with provincial sales taxes or HST; corporate income tax (federal and provincial); land transfer taxes; and withholding taxes on certain payments to non-residents. Customs duties may also apply to imported goods unless reduced under trade agreements.  

How does the Investment Canada Act (ICA) affect foreign investment?

Under the Investment Canada Act, significant foreign investments, especially those acquiring control of Canadian businesses, must undergo governmental review to assess whether they provide “net benefit to Canada.” Certain investments may trigger notification or formal review, especially when national security or regulated sectors are involved.  

Are there industry-specific restrictions on foreign ownership? 

Yes. Several sectors impose limits on foreign control:

Banks: foreign ownership capped (e.g., 10% for Schedule I banks)

Telecommunications: non-Canadian control limited (e.g., 20% voting shares)

only Canadians can hold broadcasting licenses. These restrictions ensure key industries remain under Canadian control.

What regulatory and competition laws must investors consider? 

Canada enforces competition law via the Competition Act. Mergers or acquisitions may require advance notification if thresholds are met. Conduct such as price maintenance, exclusive dealing, or abuse of dominance can be reviewed. Violations—like cartel behavior—can result in severe penalties .