Guidelines

Section A: Making a CSBF Loan

1 Business eligibility

1.1 Definition of Small Business

• business is carried on in Canada, with a place of business in Canada, and assets held in Canada for the purpose of operating the business;
• its purpose is for profit, and;
• for an existing business: during the fiscal year in which the CSBF loan is approved, its estimated gross revenues will not exceed $5,000,000, or;
• for a new business: at the time the CSBF loan is approved, its estimated gross annual revenues during the first 52 weeks of operation will not exceed $5,000,000.
  Act s.2

1.2 Ineligible Small Business

• businesses engaged in "farming" as defined in the Standard Industrial Classification (SIC), 1980 of Statistics Canada, Major Group 01 – Agricultural Industries. If more than 50% of a business's gross annual revenues come from farming operations, that business is not eligible to obtain a CSBF loan;
• charitable or religious organization;
• any business not operating for profit (e.g. a private club).

1.3 Eligible Small Business

A borrower can be operating different businesses. As an example, a borrower whose main activity is farming could have a snow removal business. The snow removal small business would be eligible to obtain a CSBF loan for the purchase or improvement of assets necessary for its operation. Bulletin – April 2001

A borrower operating in a service industry incidental to agriculture can be eligible to obtain financing. These are described in Group 02 of the SIC. For instance, the small business' activity is to provide services to other farmers, such as harvesting services. The equipment required to operate the harvesting small business would be eligible for financing under a CSBF loan. A full description of these services is described in the Bulletin of January 2007.

Salt water or fresh water fish farming businesses are eligible to obtain a CSBF loan.

Small businesses,operated by foreign citizens are eligible to obtain a CSBF loan as long as the place of business is in Canada and the assets being purchased are to be used in Canada.