Yes, a non-resident foreign corporation may conduct business in Canada through a branch office, as long as Canadian foreign investment regulations, provincial/territorial registration and licensing requirements are fulfilled.

Branch offices may be used in certain instances because of some tax advantages that the foreign corporation may enjoy. Carrying on business or conducting investment activities through a branch office allows a foreign corporation to offset losses incurred in the Canadian branch against taxable profits earned by the corporation from other sources in other jurisdictions. An examination of the applicable foreign tax law should be done to determine the corporation's opportunities for such income tax offsets. This may be particularly important for start-up operations or during reorganizations when losses may be expected.

However, because the branch office is not an entity that is legally distinct from the foreign parent corporation, the parent company remains liable for the debts, liabilities and obligations of the Canadian branch operation. The use of a branch would also directly subject the foreign corporation to Canadian provincial and federal laws.