On June 26, 2010, Citizenship and Immigration Canada (“CIC”) published proposed regulations in the Canada Gazette, which will increase the personal net worth and investment amounts utilized by the Canadian Federal Immigrant Investor Program (the “Program”). Under the proposed regulations, the investment required under the Program will increase from $400,000.00CAD to $800,000.00CAD. In addition, the personal net worth required to qualify under the Program will increase from $800,000.00CAD to $1.6 Million CAD. Once the comment period has ended, the final regulations will be published and these higher investment and personal net worth amounts will become effective.

CIC has also published Ministerial Instructions in the Canada Gazette, which will create an “administrative pause” from June 26, 2010 until the date that the final regulations become effective. According to the Ministerial Instructions, no applications under the Program will be accepted unless they are post-marked or received by CIC before June 26, 2010. No subsequent applications will be accepted until the final regulations become effective. The objective of this “administrative pause” is to mitigate the growing surge in such applications under the current investment and personal net worth levels.

According to CIC, a net worth of $800,000CAD in 1999 was considered substantial enough to attract applicants with the financial wherewithal and expertise to make a significant positive economic contribution to Canada. Due to increasing global wealth, a net worth of $800,000 is now within easy reach of a modest property owner in a large city, who may not have other transferable resources as originally envisioned. In addition, CIC states that most other countries with similar programs now require an investment closer to $1 Million CAD. It therefore feels that the Program has become underpriced on the international market. CIC wishes to increase the investment amount to $800,000.00CAD for this reason.

CIC has indicated that the current net economic benefit to Canada from each investment made under the program is only $59,229.00CAD due to the requirement to repay the investment after five years. It estimates that, under the new investment level, the net economic benefit to Canada will increase to approximately $89,000.00CAD.