The three pillars of cross-border expansion – Canadian private business expansion to the United States

For the clients of our firm’s US and Canadian immigration, tax, and corporate legal practices, we use what we call the “three pillars of crossborder expansion” to help our clients expand with peace of mind. Below are key components of these three pillars that should be considered in advance of cross-border expansion.

Pillar 1: Corporate law considerations

1. What is the current Canadian corporate structure, and what structure should be used in the US?
   
   
2. How will federal, state, and local jurisdictional laws, regulations, and policies impact expansion?
   
   
3. What impact will expansion have on financial arrangements, including banking, lender approval of asset moves, and required security for assets in the US?
   
   
4. How will the nature of business activities and location of incorporation, customers, and business activities impact corporate structuring and jurisdictional compliance? What laws will apply with respect to employment matters?
   
   
5. What type of commercial agreements are required between the different jurisdictions and in the US?

Pillar 2: Immigration law considerations

1. Have the Canadian company’s personnel faced any prior diffculties entering the US for personal or business-related activities? Put another way, is the business itself, or are certain personnel, “flagged” by USCIS?
   
   
2. Which US immigration programmes and provisions are the most advantageous for the corporate structure, nature of the business, type of worker (managerial, professional, or skilled), and citizenship of personnel required to manage the US business and transfer specialised and proprietary knowledge to any planned US personnel?
   
   
3. Does the company plan on sending intermittent business travellers, seconding employees on a short-term basis, and/ or transferring key Canadian personnel permanently to the US?
   
   
4. Will the US expansion likely lead to mergers, acquisitions, or restructuring that could impact eligibility for certain nonimmigrant and immigrant immigration programmes?

Pillar 3: Tax law considerations

1. What will trigger a taxable presence in the US for the Canadian company?
   
   
2. Should you establish a subsidiary or a branch?
   
   
3. Will the planned activities in the US trigger a project, key person, or services permanent establishment?
   
   
4. How will Canada’s foreign affliate regime impact objectives? What is the most effcient way to repatriate profits?
   
   
5. What sales tax considerations may arise?

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