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CanExport SMEs Program - Applicant’s Guide

Due to the popularity of this program, you are encouraged to submit your application three months in advance of any activities. We are committed to provide a decision within 60 business days.

Impact of COVID-19 outbreak on CanExport SME applicants and recipients

During this extraordinary time, we encourage you to make informed decisions in order to minimize risk and protect your health and the health of your employees.

  1. Consult our program-specific advice for information about how your application or approved activities may be impacted
  2. Refer to Coronavirus disease (COVID-19) for the latest information from the Government of Canada 

Table of contents

1. What is CanExport SMEs?

CanExport SMEs provides financial assistance to small and medium-sized enterprises (SMEs) registered in Canada to help them develop export opportunities for their product or service in new international markets. The program is delivered by the Trade Commissioner Service (TCS) of Global Affairs Canada, in partnership with the National Research Council of Canada Industrial Research Assistance Program (NRC-IRAP).

2. What can the Trade Commissioner Service do for me?

The Canadian Trade Commissioner Service (TCS) helps Canadian companies navigate the complexities of international markets and make better business decisions. The TCS is on the ground in more than 160 cities worldwide gaining market intelligence, uncovering opportunities for Canadian companies and helping reduce business costs and risks. The TCS is a free service of the Government of Canada that helps companies prepare for international markets, assess market potential, find qualified contacts and resolve business problems. Learn more at TradeCommissioner.gc.ca. Companies operating in the agriculture, agri-food and agri-products industry are encouraged to discuss their international business development plans with the Agriculture and Agri-Food Canada regional office in their region.

3. Can I apply?

3.1 Eligible companies

To be considered for funding, the applicant must satisfy all of the following criteria:

* Companies that do not have a CRA business number by virtue of being registered on First Nations reserve lands may request an exemption to this eligibility requirement by submitting a request to the Director General (Global Affairs Canada) in charge of the CanExport SMEs program: CanExport@international.gc.ca

3.2 Ineligible companies

While decisions will be made on a case-by-case basis, generally, third-party representatives such as trading houses, export brokers, agents and promoters, are not eligible for the CanExport SMEs program.

3.3 Eligible sectors

CanExport SMEs program is open to all industry sectors, including agriculture and agri-food.

4. How does CanExport SMEs work?

4.1 Submitting a project

A CanExport project is the ensemble of activities a company proposes to undertake in a targeted foreign market, as described in its application.

4.2 Cost sharing

Funding is provided on a cost-sharing basis between the recipient and CanExport SMEs. The program reimburses up to 75 percent of eligible expenses; the applicant is responsible for the remaining 25% (in-kind contributions do not count toward the 25%).

4.3 Stacking limit

Applicants must clearly indicate all sources of government funding (federal, provincial/territorial, and municipal) they have received in the form of grants and non-repayable contributions, for the activities outlined in their project. CanExport SMEs will only provide funding based on 75:25 cost sharing for the portion not covered by other government sources.

Failure to disclose all other sources of funding may result in rejection of the application or termination of an active project.

4.4 Funding limits and mechanisms

Applicants must provide a detailed budget for their project. The CanExport SMEs program requires applicants to submit a project for which expenses total between $20,000 and $100,000. The program reimburses up to 75 percent of eligible costs to offer between $15,000 and $75,000 in funding per project.

An applicant can only have one active CanExport SMEs project at any given time, but may apply multiple times contingent on the total funding received not exceeding $99,999 per government fiscal year (April 1 to March 31 of the following calendar year). A group of related companies (i.e., parent company, subsidiaries, sister companies and affiliates) cannot receive more than $200,000 in funding in one single fiscal year.

Financial assistance can take the form of a grant or a non-repayable contribution. CanExport SMEs determines the most appropriate funding mechanism based on a risk assessment analysis of the project.

*Companies participating in trade missions organized by Global Affairs Canada for groups under-represented in international trade (e.g. women, LGBTQ2 and Indigenous exporters) may exceptionally submit a project of less than $20,000 for consideration.

5. Which international markets can I access with CanExport SMEs?

5.1 Eligible markets

CanExport SMEs aims to help Canadian companies introduce their product or service to new international markets. Your target market is the country where you wish to secure new customers or generate sales.

Applicants can select a maximum of 5 “new” markets to target in their project.

A market is considered new and eligible if, during the company’s last complete tax reporting year (or last 12 months for monthly and quarterly filers), sales figures for that particular market were:

Applicants who include multiple target markets in their application must ensure that each market satisfies the above sales requirement. Activities proposed in markets deemed ineligible will be removed from the application. 

5.2 Ineligible markets

CanExport SMEs projects can take place in any country, provided Canada has not imposed sanctions against that country or against individuals/entities relevant to the proposed project. See the listing of current sanctions imposed by Canada.

5.3 Sub-national markets

A country is a market except in the case of Brazil, China, India and the United States, which are segmented into independent sub-national markets.

For Brazil, China, India and the United States, export sales eligibility will apply per region. This means, for example, that if an applicant has significant sales in a sub-market of Brazil, they may still access CanExport SMEs funding for activities targeting other sub-markets of Brazil that are new and eligible, as defined above.

The sub-national markets of Brazil, China, India and the United States are defined as follows:

Brazil

China

India

United States

6. Which of my expenses are eligible?

To be eligible for funding, proposed activities and incurred expenses must take place between the project start date and project completion date as specified in your funding agreement. All expenses and activities incurred outside of the project phase will not be eligible for reimbursement.  If you are unsure whether costs are eligible please contact nrc.canexport.cnrc@nrc-cnrc.gc.ca PRIOR to undertaking the activity and incurring the expense.

Companies that have been notified by Global Affairs Canada that their project has been approved, but who fail to return a signed funding agreement to NRC-IRAP within the prescribed timeline of 20 business days, forfeit their funding and will not be reimbursed for their activities.

CanExport SMEs supports 7 categories of market development activities. Applicants are required to consult their funding agreement to confirm which activity categories are approved for their project.

Category A: Travel for meetings/events with key contacts from the target market(s)

COVID-19 outbreak
Given the Government of Canada's official Global travel advisory, and unpredictable timelines related to the COVID-19 crisis, we will not approve any travel and related activities (i.e., trade shows) until further notice.

The following travel expenses can be submitted for a maximum of two individuals: owners of the company or employees based in Canada.

Note: Travellers may opt for a higher fare class or use another mode of transportation, such as bus, train, car rental, or indirect flight to the target market as a more economical alternative; however, the claimed expense cannot exceed the equivalent direct route economy or premium economy class airfare from Canada. The applicant may be required to provide supporting evidence that the higher fare class or alternate mode of transportation is cost-effective compared to economy or premium economy airfare from Canada.

Receipts will not be required for meals and incidentals; however, you are asked to keep proof of stay (e.g., accommodation receipt, airline tickets, etc.) for 5 years in the event of an audit.

Category A Ineligible expenses

  • Travel expenses for employees already residing or based in the target market(s)
  • Travel expenses incurred for markets that are not explicitly outlined in your funding agreement
  • Travel expenses related to trips that took place before approval of your CanExport SMEs project
  • Business or first class airfare (claimed expense can only be up to the equivalent direct route economy or premium economy class airfare from Canada)
  • Expenses related to the use of a personal vehicle (employee, owner or company vehicle)
  • Travel expenses for consultants and interpreters
  • Travel-peripheral expenses such as telephone and roaming expenses, Wi-Fi fees (hotel, airport, etc.), passport photos and vaccinations
  • Insurance (e.g., travel insurance, medical, dental, rental, etc.)

Category B: Participation in trade events to meet key contacts from target market(s)

COVID-19 outbreak
Given the Government of Canada's official Global travel advisory, and unpredictable timelines related to the COVID-19 crisis, we will not approve travel-dependent activities (e.g. in-person participation at trade shows) until further notice. However, participation in virtual events is permitted under Category B.

For all events:

For in-person participation only:

Category B Ineligible expenses

  • Costs for participation in trade shows/conferences taking place in Canada
  • Expenses related to events that took place before approval of your CanExport SMEs application
  • Capital costs (e.g., computers, office equipment and office space)
  • Event sponsorship and membership fees
  • Shipping/mailing costs not directly related to a CanExport SMEs-funded activity
  • Promotional products, product samples, giveaway items (pens, mugs, umbrellas, tote bags, t-shirts, etc.)
  • Company branded apparel that is not specific to the trade event or the targeted market
  • The purchase of audio visual or electronic equipment
  • Booth and exposition expenses supported by public funds, including trade fairs under Agriculture and Agri-Food Canada (AAFC)'s Canada Pavilion Program

Category C: Marketing tools creation, adaptation and translation for target market(s)

Category C ineligible expenses

  • The cost of developing core marketing and promotional material that supports your company’s operations in Canada, including creating a website or software development expenses
  • Website application, maintenance and hosting fees
  • Promotional products/giveaway items (pens, mugs, umbrellas, tote bags, t-shirts, etc.)
  • The costs associated with the development or fabrication of a prototype for the target market
  • Office supplies such as toners cartridges and printing paper

Category D: Interpretation services for target market(s)

Category D Ineligible expenses

  • Travel and per diem expenses that an interpreter does not include within their overall fee
  • The interpreter cannot be an employee of the company

Category E: Intellectual property protection, certification and adaptation of contracts for target market(s)

Category E Ineligible expenses

  • Any product development, production or distribution expenses
  • Expenses related to testing/examination/inspection to obtain certification in order to access the target market

Note : Consultant fees associated with these activities need to be included in the category: Business, tax or legal advice for target market.

Category F: Consultant - Business, tax and legal advice for target market(s)

Note: the costs of activities under categories F and G cannot exceed $66,667 per application; CanExport SMEs will apply 75:25 cost sharing to provide a maximum of $50,000 in funding per project for eligible expenses incurred by consultants.

Category F Ineligible expenses

  • Travel and per diem expenses that a consultant does not include within their overall fee
  • Salary for an in-market representative/local employee who is conducting core business activities
  • Retainer fees paid on a monthly basis

Category G: Consultant - Market research, feasibility studies, identification of key contacts and b2b facilitation for target market(s)

The applicant is required to clearly state in their application the role of the consultant in the project. The CanExport SMEs program reserves the right to request any evidence in support of the work performed.

Note: the costs of activities under categories F and G cannot exceed $66,667 per application; CanExport SMEs will apply 75:25 cost sharing to provide a maximum of $50,000 in funding per project for eligible expenses incurred by consultants.

Category G Ineligible expenses

  • Travel and per diem expenses for a consultant that are not included within their overall fee
  • Salary for an in-market representative/local employee who is conducting core business activities
  • Retainer fees paid on a monthly basis

6.8 Currency Exchange Rates

CanExport will reimburse eligible expenses in Canadian dollars. If project expenses are incurred in any other currency, you must keep proof of the exchange rate for the transaction. Funding recipients are required to keep adequate financial records and segregate CanExport project costs from their normal operation costs to provide traceability of CanExport expenses.

6.9 Ineligible expenses

Though CanExport SMEs supports export marketing and international business development activities, the following list outlines additional ineligible expenses under the program beyond those listed under the previous 7 categories:

7. How do I apply?

Your CanExport project performance matters! Recipients who claim at least 80% of approved funding and submit all required reporting will build a strong track record with the program.

8. How will my application be assessed?

All applications are assessed on their individual merits using the following 5 criteria:

8.1 Incrementality: building toward new initiatives

The applicant must clearly demonstrate that the project goes beyond its core activities or everyday business activities in Canada, represents new initiatives and has the potential to meet the company’s international business development objectives. Most importantly, an applicant must select target markets that are “new” and eligible for all of the activities it proposes to undertake.

8.2 Export business case: merits of your project

The applicant must adequately answer the following questions in detail:

8.3 Alignment with Government of Canada trade strategies and priorities

Projects objectives aligned with the economic objectives and priorities of the Government of Canada will be given special consideration. Such projects include, for example, those submitted by under-represented groups in international trade (i.e., women, LGBTQ2 and indigenous peoples) or taking place in markets where Canada has free trade agreements.

8.4 Market potential: understanding your target market(s)

The assessment will take into account possible in-market challenges and opportunities for the applicant’s products and services, and the soundness of the proposed activities for that particular industry sector in the target market(s).

8.5 Exporting readiness and history

CanExport will review the applicant’s performance in previous CanExport projects, their interactions with Global Affairs Canada and its partners, and their capacity to undertake the proposed project activities based on the resources outlined in their application.

CanExport SMEs takes into consideration a company’s lapse rate on past CanExport projects; to build a strong track record with the program, recipients should claim at least 80% of approved funding.

While we assess all applications against the same merit criteria; we will score applications relative to the project size, complexity and funding amount requested.

The evidence provided to support your application should be proportional to the size and complexity of the project. If our review identifies unintentional errors in your application, we may contact you to correct or clarify the errors, but note that you cannot make any material alteration or addition to your application once submitted.

9. What happens after my project is approved?

Global Affairs Canada is responsible for notifying both successful and unsuccessful applicants of the decision rendered for their application, as well as for referring successful applications to the National Research Council of Canada Industrial Research Assistance Program (NRC-IRAP), which then prepares and mails a funding agreement to the recipient.

Applicants who are notified by Global Affairs Canada that their project has been approved can expect to receive their funding agreement by registered mail within 10-12 business days. An authorized officer of your firm will need to review, sign and return the agreement within 20 business days of the NRC-IRAP’s signature date. The agreement is a legally binding document, which outlines the approved activities and funding amounts, as well as the responsibilities and obligations of both signing parties.

Step 1: Application submitted. Step 2: Email notification from GAC; Up to 60 business days; Project phase starts on this date. Step 3: Funding agreement sent by NRC-IRAP by registered mail; 10-12 business days. Step 4: Agreement must be signed and returned to NRC-IRAP; 20 business days.

9.1 Contribution recipients:

Once NRC-IRAP receives a signed copy of your funding agreement, you may claim for costs incurred within the project phase of your agreement. You can only claim for the activities supported under your contribution agreement. Recipients can submit claims for reimbursement at any time while their project is active, but it is highly recommended to submitting claims as they incur expenses or at least every 3 months. NRC-IRAP will endeavour to process claims and reimburse eligible expenses within 30 business days.

9.2 Grant recipients:

Once NRC-IRAP receives a signed copy of your funding agreement, you will be able to receive payment as per the fiscal year distribution of your agreement. You can use the funds provided to complete the activities supported under your grant agreement.

9.3 Amendment to the funding agreement

No amendments to grant agreements are allowed.

Amendments to contribution agreements will only be considered on an extraordinary basis and if a strong rationale is provided. To request an amendment, write to NRC-IRAP (NRC.CanExport.CNRC@nrc-cnrc.gc.ca) outlining any material modifications to your company’s status, approved activities, approved costs, or any other issues that may require an amendment to the agreement.  

Amending or adding activities: Amendment requests must be made prior to concerned activities taking place. CanExport SMEs reserves the right to approve or refuse an amendment request; any expenses incurred prior to the decision are at the recipient’s own risk. Note: Requests for amendments will not be accepted approaching government fiscal year’s end (i.e. February and March of each calendar year).

Removing activities: If you will not be using the entire amount provided for your project, please advise NRC-IRAP as soon as possible, as any lapsing of funds will impact your company’s ability to be considered for future CanExport projects. Changes that represent a significant departure from the scope of the original funding agreement will require the recipient to submit a new application for assessment.

Important:

9.4 Keeping us informed

You should let us know if anything is likely to affect your project, or keep us informed about key changes to your company or its business activities, particularly if they affect your ability to complete your project, carry on business and pay debts due.

You must also inform us of any changes to information that identifies your company (name, address, designated representatives or bank account details), or if you become aware of a breach of terms and conditions under the funding agreement.

9.5 Closing a project

Applicants  can close their project by submitting a final report and any outstanding claims to NRC-IRAP. Once NRC-IRAP has processed the final claims (approximately 20 business days), the project will be considered officially closed and you are free to submit a new project for consideration to the CanExport SMEs program.

10. How does the Government of Canada monitor and evaluate my project?

The Government of Canada will monitor activities, conduct audits and evaluations and seek information on program results.

10.1 Status report (contribution recipients only)

Contribution recipients must provide a status report – as described in the contribution agreement – with each expense claim. The status report details the activities and outcomes of the project, measured against the approved activities and project objectives.

Interim report (grant recipients only)

Grant recipients who are approved for funding over multiple government fiscal years (April 1 to March 31 of the following calendar year) must submit an interim report by March 31 to receive payments for the next fiscal year. The interim report provides the CanExport SMEs program with details on how your project is progressing.

10.2 Final report

You will be required to provide a final report at the end of the project. The report will ask questions relating to the activities conducted, challenges encountered, concrete project outcomes (including in relation to the expected results) and successes achieved in your chosen target market(s).

10.3 Snapshot reports

Each recipient is asked to provide a short snapshot each year for 3 years following the end of the project phase. The purpose of the snapshot is to assess the benefits resulting from the funded project. Specifically, the recipient will need to report the number of employees, total revenue, international sales revenue, and whether the company has exported to the CanExport SMEs- supported target markets. This information is collected for statistical purposes only and will not factor into the evaluation of any future CanExport SMEs application.

10.4 Audits

Recipients may be subject to an audit. Recipients selected for an audit will be notified well in advance. Audits normally occur after the expiry date of the agreement and are carried out by Global Affairs Canada or by professional auditing firms on behalf of the CanExport SMEs program. For this reason, it is imperative that firms maintain records of activities for 5 years to substantiate costs incurred, including: dates, times and destinations of travel; the name and title of individuals travelling on behalf of the company; the use of consultants; and receipts for all expenses claimed related to the approved activities set out in the funding agreement. If an audit identifies an overpayment, your company will be asked for a reimbursement.

10.5 Site visits

On occasion, a trade commissioner with Global Affairs Canada may visit the firm at its place of business or at the site where approved projects and activities are taking place.

10.6 CanExport SMEs program evaluation

Evaluating program performance is a key part of the federal government's strategy to manage for results.  CanExport recipients may be asked to provide information on how their CanExport SMEs project has performed to an evaluator or to respond to a questionnaire to support the evaluation.

11. Enquiries and feedback

If you have questions not covered in the applicant’s guide or the Frequently Asked Questions (FAQ), we invite you to contact us at the following e-mail address: CanExportSMEs@international.gc.ca. Please note however, due to the high volume of emails that the program receives, only questions that are not already addressed in these documents will be answered.

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