The enterprise must be at least fifty percent owned by nationals of the treaty country, and the investor must additionally develop and direct it, which ordinarily means majority ownership or demonstrated operational control. A minority holding by the only treaty national in the deal defeats the application regardless of the amount invested.
The share register is read before the bank statements
Two thresholds are easy to confuse. The fifty percent figure is about the nationality of the business and asks who owns it. Develop and direct is about control and asks who runs it, which is usually satisfied by majority ownership but can also be shown by operational control where ownership is exactly even.
Hypothetical example: Marilou, a drainage contractor buying an American company with an American partner, would hold forty-five percent, which fails the first test outright, and fixing it costs a renegotiation rather than a refusal. Hypothetical example: a honey and beeswax processor from the parish plans to hold her American company through the Quebec holding company she already uses, which is convenient until someone notices that a passive investor who is not a treaty national holds a third of that holding company. The analysis follows the shares upward, so the American business is treated as less than fifty percent treaty-owned even though she personally is Canadian.
Ownership questions are cheapest to fix before signatures and close to impossible to fix afterwards without renegotiating the whole deal.