Mega-reversal: Sask. government bans future immigration applications tied to GTH megamall project
Sudden policy shift two days after CBC iTeam interview raising concerns about GTEC project
After almost four years of close, enthusiastic cooperation with the developer of a wholesale mall at the Global Transportation Hub, the government of Saskatchewan has announced a major reversal.
It says it will no longer support immigration applications tied to the Global Trade and Exhibition Centre (GTEC) - a wholesale mall built and promoted by Brightenview International.
The government made the decision on Nov. 6, just two days after CBC interviewed a senior immigration official. In that interview, CBC explained the results of its investigation into GTEC and the concerns it uncovered.
Since the project was announced in 2016, Brightenview and its agents have told Chinese nationals that purchasing a showroom unit in GTEC could qualify them for Canadian permanent residency under the entrepreneurial category of the Saskatchewan Immigrant Nominee Program (SINP).
Since that time, the Saskatchewan government has enthusiastically supported the project. Premier Brad Wall went to China and spoke at an event promoting GTEC to investors there and the project has been promoted on Saskatchewan government social media sites in China.
That support disappeared last week.
"Future applications from applicants who are proposing to establish a business out at GTEC would no longer be eligible," said the assistant deputy minister responsible for immigration, Christa Ross.
In an interview with CBC on Friday, she said the government now believes GTEC's business model is too risky for foreign nationals.
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"We've come to the conclusion that with the reliance on such a business model on immigrant interests and investment and the subsequent dependence then on immigration program decisions at both the provincial and federal level that it's a business model that carries undue risk to the success of the entrepreneurs themselves," Ross said.
In addition, she pointed out that the SINP is designed to create real permanent businesses in Saskatchewan but the government became concerned that may not be happening with GTEC.
"It creates risk for their settlement, integration and retention because of a lack of connection with the local business community and economy," said a follow-up email from the ministry. "This puts the overall outcomes and success of the SINP at risk."
Sudden reversal 'a remarkable coincidence'
On Nov. 4, CBC interviewed Alastair MacFadden, deputy minister responsible for immigration, about the GTEC program. During that interview, MacFadden defended the Saskatchewan government's handling of the project.
Just two days later, on Nov. 6, the government decided to make the policy shift related to GTEC. The government says the changes are not aimed just at GTEC but will apply to any project using a similar model.
On Nov. 7, it sent out emails notifying people interested in the program that "effective immediately, proposed businesses located in a multi-business retail condo project or business incubator are no longer eligible business locations." It also announced the cancellation of an immigration draw that had been scheduled for that day.
CBC asked if the rapid shift was related to the Nov. 4 interview.
How did Brightenview get their hands on a direct arrangement with the government of Saskatchewan?- Richard Kurland - Immigration lawyer
Ross said there was "no direct cause and effect relationship," noting "the information that you were raising on Monday's call wasn't new to us and was certainly related to some of our own internal conversations."
Immigration lawyer and policy analyst Richard Kurland said it's good that the government has finally put an end to these applications. But he thinks the timing is notable.
"I find it a remarkable coincidence that within 48 hours of a phone call with CBC, an entire program is cancelled," he said. "In my experience, I've never seen a program modified so quickly unless someone seriously dropped the ball."
He believes the government made a strategic decision that "there's less damage cutting it now than cutting it after the story goes public."
Kurland said government has known for years there are problems with GTEC, in part because of CBC's many stories about it.
"What is clear is the ostrich approach to governance failed in the GTEC case. They tried to hide their head in the sand and hope things would simply go away. It didn't happen."
Who knew what when?
Kurland said it is now crucial that the government be open and transparent about its support of this project and why that happened.
"How did Brightenview get their hands on a direct arrangement with the government of Saskatchewan? Was it public tender or secret?" he wonders.
In February 2016, the Saskatchewan government signed an agreement to sell land to Brightenview for this project. That same day, the government signed a secret cooperation agreement with Brightenview spelling out the relationship between the two entities.
CBC tried to obtain that document through an access to information request but was unsuccessful. CBC is fighting for it in court but the Saskatchewan government is fighting back.
Kurland wonders why.
"Who authorized this private arrangement?" he asked. "It's incredible, particularly since literally several tens of millions of dollars were on the table as a benefit for someone. So there are a lot of questions that need to be asked and need to be answered."
The Saskatchewan government approved more than one hundred GTEC applications from foreign nationals. The province says its policy shift doesn't affect those people.
But Kurland points out that the government's decision will have a significant impact on those applicants as well.
I just learned the news yesterday and haven't had a chance to sort out the implications to our business- Joe Zhou - CEO of Brightenview
Kurland said this is likely to end up as a class-action lawsuit and he said taxpayers could be on the hook.
"Unfortunately the outcome I see is that the Saskatchewan taxpayer is going to foot the bill for the political decision to get in bed in an immigration arrangement with a private sector company that they're still not disclosing," Kurland said.
On Friday, CBC reached out to Brightenview CEO Joe Zhou for comment about the government's policy change.
"I just learned the news yesterday and haven't had a chance to sort out the implications to our business," he wrote in an email.