EB-5 FIFTH PREFERENCE – EMPLOYMENT BASED IMMIGRATION Detail
USCIS administers the EB-5, or the Immigrant Investor Program. Created by Congress in 1990 to stimulate the U.S. economy, the EB-5 is meant to create jobs and generate capital investment through foreign investors. Certain EB-5 visas are also allotted for investors in the Regional Centers designated by USCIS for the purpose of economic growth.
Among the highlights of the EB-5 Visa include:
- A route to a Green Card or United State Permanent Residency for the investor, the spouse, and children under the age of 21.
- Freedom and privilege to live, work, and retire anywhere in the United States
- United States citizenship after five years of being a Green Card holder
- College and University education for investor’s children at U.S resident cost
To be eligible for the EB-5 visa, the immigrant investor must invest or be actively participating in the process of investing, in most cases, at least One Million U.S. Dollars (US$1,000,000.00) in capital in a U.S. Business.
However, the law gives U.S. Citizenship and Immigration Services (USCIS) flexibility to raise or lower the minimum investment amount. In high employment areas, USCIS can require a minimum investment of up to Three Million US Dollars (US$3,000,000.00).
In targeted areas, the minimum investment can be lowered to Five Hundred Thousand U.S. Dollars (US$500,000.00). A targeted area is defined to include rural areas (outside of a metropolitan area and in a city or town with less 20,000 people) or an area with an unemployment rate of at least One Hundred Fifty Percent (150%) of the national average rate.
Actual Commitment of Capital
The investment must be placed at risk for the purpose of generating a return on that capital. Therefore the investor’s loan to the company or investor’s promise to invest in the future are not considered an investment.
The investment may be made in cash or other property. Examples of actual commitment of investment include the following:
- deposit of moneys in the company’s bank account without any obligation to pay back;
- purchase and transfer of needed assets to the company; and
- deposit of moneys into an escrow account whereby the only condition to being released to the company is USCIS denial of the permanent resident application.
The invested funds must have been obtained through legal means. The capital may have been acquired by any lawful means, including gifts, and inheritances. Documentation must be submitted to establish that the funds were acquired legally. An example of documents needed include: business records, tax returns, bank statements, proof of ownership of properties, and proof of sale of a business or property. Obtaining the investment amount through a loan is also considered to be lawful. Therefore the investor may obtain the capital through a loan from a third party, such as a bank. But such a loan, to qualify, must be guaranteed with investor’s own assets (not company’s assets) and must be paid within the two years conditional residence period.
New Enterprise or Troubled Business
The investment must be used to either establish a new commercial enterprise or to rescue a troubled business. The rules describe the various ways a new commercial enterprise can be established, including:
- by creating an original business (established after November 29, 1990),
- by buying and reorganizing an existing company
- by investing in an existing business and increasing the number of employees or the net worth of the business by at least forty percent (40%).
As stated above, the investment may also be made into a troubled business.
A troubled business is defined as a business that has been in existence at least two years and have incurred a net loss of at least twenty percent (20%) of its net worth. For the purpose of ascertaining whether the troubled business has been in existence for two years, the successors in interest to the business will be deemed to have been in existence for the same period of time as the business they succeeded.
For the purposes of Eb-5 Visa application, a Commercial Enterprise may be defined as any for-profit activity formed for the conduct of lawful business; including, but not limited to:
- Sole proprietorship
- Partnership, General or Limited
- Holding Company
- Joint Venture
- Business or Trust Entity, whether Publicly or Privately Owned
This definition include commercial enterprises consisting of a holding company and its subsidiaries; on the condition that each subsidiary is engaged in a for-profit activity for the conduct of lawful business. On the other hand, this definition does not include non-commercial activity such as owning and operating a personal residence.
The investment must benefit the U.S. Economy and must create, in most cases, at least ten (10) full time jobs. The jobs can be filled by U.S. Citizens, Permanent Residents and other immigrants lawfully authorized to be employed in the United States, but not immediate family members of the investors. Full time employment requires at least thirty-five (35) hours per week of work.
This full-time could be direct or indirect jobs:
- Direct Jobs: actual identifiable jobs for qualified employees located within the commercial enterprise into which t he EB-5 investor has directly invested his or her capital.
- Indirect Jobs: jobs shown to have been created collaterally or as a result of capital investment in a commercial enterprise affiliated with a regional center by an EB-5 investor. A foreign investor may only use indirect job calculation if affiliated with a Regional Center.
Two exceptions exist to the above requirement. An investment into a troubled business does not require a creation of ten jobs, instead, it merely requires that the number of existing jobs will be maintained at the pre-investment level. Furthermore, the job creation requirement is relaxed for an investment in an area with a regional center designation, where the revenues generated by the enterprise results in exports.
Supporting Evidence to Job Creation
A comprehensive business plan showing that, due to the nature and projected size of the new commercial enterprise, the need for not fewer than 10 employees will result. This should include approximate dates within the next two years, and when each employee will be hired. This number of employees should not include the investor, his or her spouse, children, or any temporary or immigrant workers or individuals not authorized to work in the U.S.
The investor must be engaged in the management of the enterprise, either through day-to-day managerial control or through policy formulation. This requirement can be met if the investor holds a corporate office or holds a seat on the board of directors.
The Regional Center Option
If an investor does not want to participate actively in the operation and management of a commercial enterprise, he or she may instead opt to invest in a Regional Center approved by U.S. Citizenship and Immigration Services to receive investment.
To date, there are more than 200 Regional Centers approved for this purpose. An investor for the Regional Center must invest a minimum amount of $500,000 if the Regional Center investment is a “targeted employment area”, along with filing a petition showing how the investment in such Regional Center will be used by the same to generate at least 10 new direct or indirect jobs.
Regional Centers must be approved by USCIS before they can be utilized by immigrant investors to qualify for immigrant status in the U.S. The center must file for a petition with the filing fee, including a proposal that:
- Identifies a clear, contiguous geographical area to be served by the center.
- Provides a detailed description of how the capital investment made into the area will create jobs (directly or indirectly). This business plan must be supported by a full economic and statistical analysis to demonstrate viability.
- A detailed prediction of regional and national economic impact of the center on the area.
- Demonstrates how the center will be operated to attract investors, find projects, structure capital, and supervise all investment activities.
A Regional Center petition must be substantially documented to ensure the likelihood of success for its purpose. After anticipated approval, the Regional Center can accept investments from individual foreign investors, which investments will be used toward generating the jobs as required. The investor much also include documentation of the anticipated job creation, subject to approval for conditional resident status.
The investors and their immediate family members must otherwise be qualified to receive permanent resident status. For example the individuals must not have a criminal conviction that makes them ineligible. (Not all criminal convictions make an applicant ineligible).
To apply, you must:
- File the Green Card EB-5 Petition. Once the petition is approved, the USCIS forwards the approved petition to the National Visa Center (NVC), which will contact you when an immigrant visa number becomes available;
- Obtain status as a Conditional Resident. Once the EB-5 investment based green card petition is approved, you may obtain status as a conditional resident: if you reside within the United States, apply for adjustment to Conditional Permanent Resident status and if you reside outside of the United States, apply for an immigrant visa at the American Consulate abroad.To deter fraud, you your spouse, and your children are subject to conditional permanent residence for a two year period; and
- Remove conditions on permanent residence. To remove the two-year conditions on permanent residence, you must file a USCIS Form I-829, Petition by Entrepreneur to Remove Conditions. Form I-829 must be filed within 90 days before the second anniversary of your admission to the U.S. as a conditional resident.
The EB-5 (Green Card) is available for Immigrant Investors and their immediate family members. The immigrant investor must acquire approval for an immigration petition. Once approved, the investor, together with his or her immediate family, must apply for consulate processing (outside of US) or file for adjustment of status (within US). Upon approval, they will receive a conditional residence for two years. Condition must be removed within two years to be able to receive a permanent status with unlimited time. And those individuals obtaining permanent resident status (including the conditional status), they may remain and get employment in the United States.
You Need an Immigration Lawyer for Your EB-5 Visa Application
Applying for an Immigrant Investor Program Visa implies includes an intricate process, which is one may consider as more complex than the other Visa application categories. As an investor, you need the assistance of a legal professional to help you through your EB-5 Visa, also ensuring that you get an expedited, cost-effective application process.
Some investors to the U.S have opted to undertake the Visa process on their own thinking that it can save them money– but with a glitch along the process, you get to spend way more than you would if you opt for the legal services of an Immigration Lawyer.
At The Gambacorta Law Office, our goal is to expedite your Visa Application, giving you a holistic assistance towards achieving your Green Card. We help foreign investors from every country, working passionately towards achieving their cause.
If you are a foreign investor planning on investing in the US for an EB-5 Visa, our office is here to help.
Get in touch with us to know more about how we can help you with your EB-5 application today!