EB-5 Investor Program Overview

EB-5 stands for “Employment-based Fifth Preference,” which is the fifth preference category for U.S. immigrant visas. The category allows for up to 10,000 immigrant visas for non-U.S. nationals who invest personal funds consisting of either $1,000,000 or $500,000 (for investments in a rural or high-unemployment region), into a for-profit business that creates ten (10) permanent, full-time (at least 35 hours per week) jobs for U.S. workers.

To meet the investment criteria for this immigrant visa category, an investor must acquire an equity stake in a “new” commercial enterprise, defined as one that has come into existence after November 29, 1990.The funds must be deployed and “at risk,” meaning that the investor risks losing the entire investment amount in the event of failure of the business. Redemption agreements, buyback agreements, loan instruments or guarantees are strictly prohibited.

APPLICATION QUALIFICATIONS

An EB-5 investor must qualify both from the investment as well as the immigration standpoint. Applicants must be admissible as immigrants to the United States, meaning that they must not have committed serious violations U.S. immigration laws.

In addition, applicants who have made willful misrepresentations to any immigration official, or who have committed certain crimes, are inadmissible as immigrants (although in some limited cases there may be waivers available). Applicants must also pass a physical examination to rule out certain communicable diseases, addictions or mental health conditions.

In addition, each investor must be able to prove that the source of his or her investment funds was lawful. He or she must provide documentation of earnings, assets, loans, inheritance, or any other lawful source of the investment funds. In addition, it will be necessary to prove the path of the investment funds into the United States business enterprise.

EB-5 PROCESS AND TIMELINE

For a direct investment into a United States business, an investor must form or join a “new” business and place the necessary funds at risk. This means that the investment capital must not only be deposited into the operating account of the U.S. business, but they must be entirely committed to the business activities.

Expenses such as legal and other professional fees, payments to agents, and other costs not directly linked to the business activities must be paid for separately from the investor’s “administrative fees,” since these are not considered to be relevant to the job-creating business activities.

The I-526 application typically takes up to twelve (12) months for the United States Citizenship and Immigration Services to adjudicate. Occasionally the USCIS will issue a “Request for Evidence,” or RFE, asking for additional information or clarification.

Once an investor receives his or her conditional residence, he or she (and dependents) may reside anywhere in the United States, become employed, and travel in and out at will. Within ninety (90) days before the second anniversary of conditional residence, the immigrant must file an application to remove the conditions on his or her residence, by filing Form I-829, “Application to Remove Conditions.”

This and the required supporting evidence will establish that the investment funds remain at risk, that the business plan for the U.S. for-profit enterprise has been substantially adhered to, and that the projected jobs have been created. Documentation and proof normally consists of tax returns, business bank accounts, payroll records and other evidence of business activities. The I-829 application may take up to an additional twelve months to be approved.

Once the I-829 has been approved, the investor and his or her family receive their permanent residence, with no conditions. At this point, if desired, the investor may withdraw from the investment by selling his or her interest in the business enterprise. Or, the investor may maintain the investment and continue to hold a membership interest in the business.

Five years from the date of the initial approval of the I-526, the investor and his or her family will be eligible to apply for United States citizenship.

The EB-5 immigrant visa program is a viable and sensible way for the non-U.S. national with means to acquire United States status. In addition, the investor may acquire the sense of pride and accomplishment that accompany the establishment and operation of a business that creates permanent jobs for U.S. workers.

This is truly a win-win situation in which the U.S. welcomes the infusion of foreign capital into its economy, and the investor enjoys the knowledge that he or she has made a meaningful contribution to his or her new home country.

After an investor’s I-526 application has been approved, the investor and his or her spouse and children under the age of 21 are eligible to adjust status to lawful permanent resident or process for an immigrant visa at the U.S. consulate or embassy in his or her home country. Adjustment of status is the process for obtaining a green card in the United States, and it is only available to individuals who are in lawful status (usually as nonimmigrants).

The adjustment of status process involves submitting a form with supporting evidence of the intending immigrant’s admissibility as an immigrant. Consular processing involves an application for an immigrant visa at the consulate or embassy with jurisdiction over the intending immigrants’ home abroad.

Both adjustment of status and consular processing may take several months — and sometimes up to one year. The investor and his or her family will now have conditional residence.