The EB-5 Visa program was introduced in 1990 to stimulate the U.S. economy by facilitating foreign investment and domestic job creation.
The EB-5 visa is a green card, giving lawful permanent U.S. residency to the holder and their immediate family members. Up to 10,000 EB-5 Visas are awarded each year.
It is awarded to foreign investors who invest a significant amount of money in a business in the United States that provides goods or services in the domestic economy. The business may be newly formed, or could be formed by restructuring an existing enterprise.
In certain areas called "targeted employment areas", the minimum investment is $500k. In all other areas, the minimum required investment is $1 million. The investment does not have to be all in cash; other assets may be taken into account, including debts, stock, or hardware. The funds must also be shown to come from lawful sources.
Note: Congress has recently considered increasing the minimum investment from $500k to around $1M. The law establishing Regional Centers is due to expire on Sept. 30, 2018. Required investment amounts may go up after this date, if Congress passes the legislation, so ACT NOW!
You must be able to show that the investment will – directly or indirectly – create at least ten new full-time jobs in the U.S. economy for people qualified to work in the U.S., i.e. citizens, permanent residents, or other immigrants authorized to work in the United States. Note that the EB-5 investor does not count towards this total, even if they work full-time in the business.
Alternatively, if the investment is made in a "failing business", protecting jobs in the business may fulfil the same objective. In this case, the number of employees in the existing business must be maintained at no lower than pre-investment levels.
The investor may be actively involved in the business, either as a manager or limited partner, but is not prevented from doing other work or from studying in the United States.
There must be an element of "risk of loss" of capital in the investment, i.e. the investor must stand both to gain from the investment and also possibly to lose the entire sum. That means it is illegal for any party to guarantee the EB-5 investor a return on their investment. (However, it is permitted for a Job Creation Enterprise to guarantee the return of a loan to a New Commercial Enterprise.)
There are two options for EB5 Investors: Direct Investment, or Regional Center investment.
EB-5 visa applications may be sponsored by one of over 300 Regional Centers. These are public or private approved organizations that are involved with economic growth.
Regional Center investments generally follow a loan-based model with no ownership of the project or everyday control and management (unless a direct equity investment wherein an investor applicant ‘buys’ a share in the project). Regional Centers tend to be most useful for investors who do not intend to invest direct and take a day-to-day role in the business.
Another benefit of using a Regional Center is that it allows the project to count indirect job creation alongside direct jobs, to help meet the job creation criteria. Also, the burden to create 10 full-time US jobs is on developer/borrower
Going through a Regional Center is also advisable for investors who may wish to move anywhere in the country and so do not wish to be located close to the business.
The performance and suitability of different Regional Centers can vary widely, so it is crucial to get all relevant background information before deciding to invest this way.
A: A failing business is one that has been running for at least two years and has returned a loss over the previous 12 or 24 months at the time of filing. The loss must total at least 20 percent of the business's current net worth.
A: If you plan to leave the country for more than twelve consecutive months, you must apply for a reentry permit before you leave.
A: Yes, your legal spouse and any minor children (under 21 years of age and unmarried) can apply for a visa to live in the United States conditionally for up to two years. After the two years, they may apply for removal of conditions with an I-829 petition.
As permanent residents, family members are free to live, work, or study anywhere in the U.S.
Conditional permanent residents must apply for removal of conditions during the 90 days leading up to the end of the two-year period.
A: The EB-5 holder may apply for citizenship after being a permanent resident for at least five years.
Their current spouse may also apply later, provided they have been a permanent resident for three years and married to the same U.S. citizen for three continuous years.
A: It depends where you apply. Some states require all EB-5 petitioners to be represented by an experienced attorney. However, hiring an experienced immigration attorney and broker-dealer will strengthen both your application and your chances of choosing a suitable regional center, and of making a successful long-term investment.
A: A Targeted Employment Area is either:
A: Not immediately. The business in which you invest should be able to create and maintain 10 full-time jobs over 2 years, i.e. during the period in which the EB-5 Visa holder has been granted Conditional Permanent Residency.
A: The jobs can be direct or indirect
A: It is not sufficient that the investment is made out of lawfully generated funds, the intent to invest must be accompanied with the understanding that the capital must be at risk; hence there must be a risk of loss and/or a chance of gain.
Any agreements or understanding between the commercial enterprise/new entity and the investor which state that the investment may be redeemed or assured return will not satisfy the requirement of the capital being at risk.
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