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Declaring it via the webform is the right thing to do, in my opinion. Don't wait for them to see it and send you a procedural fairness letter. Send them a very clear explanation.

Caps are good, however what does one do if they are literally unable to find a qualified person for a very specific job?

I have been reading about this and I have an LMIA application ready to be submitted. I don't know what to do. Is this an error or did they intentionally screw the smaller businesses? The employer has been advertising since January and has not found a person who qualifies for the job.. Who knows...