What is EB-5 Visa for USA?
What is EB-5 Visa for USA?
The EB-5 visa for USA is an immigrant visa program, or in other words, a green card program of the United States government that allows a foreign investor or entrepreneur to come, live and work in the US on a permanent basis together with their spouse and children. The EB-5 visa for the USA allows foreign investors and entrepreneurs and their family to become permanent residents of the United States (green card holders) in exchange for making an investment in a business or commercial activity in the United States.
With the EB-5 visa for USA, the EB-5 investor and their wife or husband and children who are unmarried and under the age of 21 all obtain green cards if the requirements are met. Simply put, if you are a foreign investor or entrepreneur who wants to invest the minimum amount required in a business in the United States and you meet all the other requirements below, you can apply for an EB-5 green card for you and your family, including your wife or husband and your children under the age of 21 and unmarried.
In addition, it is possible to convert an investment made into a business in the United States for an E-2 visa or an L-1 visa into an EB-5 visa.
Who is eligible for the EB-5 Visa?
Any foreign investor or entrepreneur regardless of their country of citizenship is eligible for an EB-5 visa for the United States if they meet the following key minimum requirements:
1. Minimum investment of capital required. The EB-5 investor must invest or be in the process of investing $900,000 in a U.S. business in a rural or high-unemployment area or $1.8 million in a U.S. business in an urban area. The amount of capital required for investment does not necessarily have to be cash and it can be loans and other debt and cash equivalents as discussed in detail below.
Investment for EB-5 visa: cash, property and loans
Practically, to satisfy the minimum investment of capital required for the EB-5 visa in the USA, you can contribute anything of financial value to the U.S. business including cash, equipment, inventory, other tangible property such as land or vehicles, cash equivalents and loans valued at fair market value in U.S. dollars.
As an EB-5 investor, you can take a loan out for the EB-5 visa but you must be personally and primarily liable for the loan subject to certain other requirements. If you plan on contributing proceeds from a loan to apply for the EB-5 green card it is recommended to consult with an experienced business and immigration lawyer to make sure that the loan satisfies the requirements imposed by U.S. immigration law and the EB-5 green card regulations. Not all business and financial transactions that make sense from a business standpoint are compliant with U.S. business immigration laws.
In addition, loans from you to the EB-5 business are not permitted and you also cannot contribute capital to the business in exchange for a note, bond, convertible debt, obligation, or other arrangement between you and the business for the purposes of U.S. business immigration law and EB-5 green card regulations.
2. The investment must be made in a new or existing U.S. business or Regional Center projects. Option 1 is for the EB-5 investor to invest in a U.S. business that is a startup or an already existing business. This means that the investor can start a business in the United States from zero, can buy a business that is already active and has economic activity or can buy a franchise. Option 2 is for the EB-5 investor to invest in regional center projects.
The most important point is that the business in which the EB-5 investor chooses to invest is a business for profit that has a line of goods or services that it offers to the public and is not simply a business that has no commercial activity and is used for personal purposes such as to own and manage residential property (for example, a house or an apartment) or land. This is why purchasing financial instruments traded on secondary markets, that is stock exchanges and over-the-counter (OTC) markets, does not generally qualify as investment into a U.S. business for the purpose of EB-5 green card regulations and U.S. immigration laws.
As an EB-5 investor, you must not only invest in a U.S. company that conducts business activity that is commercial in nature and not financial, but you must also place the minimum amount of capital required at risk in the company – the risk being the risk of loss or chance for gain if the business becomes successful.
3. The investor must be the owner of the funds or property invested and be legal. The EB-5 investor must use funds that come from a legal source to invest in any business or regional center projects for the EB-5 visa in the USA and the investor must personally own the funds, property or other proceeds invested.
The amount of capital to be invested can come from sources outside of the United States or inside the United States. In addition, the investment does not need come from one source only but can come from a mix of sources, including for example, funds from sale of property or business in the U.S. or abroad, wages and salaries, bonuses, inheritance, dividends, interest, gifts or some form of loans under certain conditions. It is also possible that the funds invested, or part of the funds invested are earned from an E-2 business or an L-1 business owned by the investor as long as the investor meets all the other requirements.
4. The minimum capital invested must create U.S. jobs or preserve U.S. jobs. The final requirement is that the EB-5 investor must show that the capital invested will create directly or indirectly at least 10 full-time jobs for U.S. workers and in certain limited situations, will preserve U.S. jobs. The 10 full-time jobs do not include hiring the investor or their spouse, children or any person in nonimmigrant status. This applies for investment in new or existing businesses or regional center projects.
However, the investor does not need to hire any full-time U.S. workers before he or she can apply for the EB-5 visa for the USA. In fact, the EB-5 investor does not need to hire any workers before applying for the EB-5 visa. Generally, a business plan is necessary to show that the business investment will create the full-time jobs.
Satisfying U.S. job creation requirement for multiple EB-5 investors
In the case of more EB-5 investors coming together to combine funds to develop a business, each EB-5 investor must create at some point in time as required by law at least 10 full-time positions, meaning the business they all invest in must create at least 10 jobs multiplied by the number of investors applying for an EB-5 visa for the USA. For example, let us say that 10 investors from different countries want to develop a hotel in the urban Miami Beach, Florida and each of the investors wants to apply for an EB-5 green card for themselves and their family. The hotel development in Miami Beach requires a large investment to purchase the land, develop the architectural plans, obtain licenses and comply with Miami-Dade planning and zoning, build the structure, purchase fixtures, furniture and signs, hire staff for the hotel and other expenses for marketing and hotel operation. Then each of the 10 investors must contribute the required minimum amount of capital to the hotel development business and each must create at least 10 jobs. This means that the 10 investors’ capital contributions ($18 million total capital calculated at $1.8 million contributed capital per investor) must result in the creation of 100 jobs for U.S. workers (10 jobs for each investor’s capital investment).
If a foreign investor or entrepreneur can satisfy these minimum requirements above, then he or she is on the way to obtaining an EB-5 green card for themselves and their family. But before getting into more details it is important to discuss how long does the EB-5 visa last for.
How long is an EB-5 Visa good for?
The EB-5 Visa for the USA is a green card, and it is good for forever once obtained as long as the person holding the green card maintains certain requirements for US residency. With the EB-5 green card the individual is a permanent resident of the United States and does not need to go get another visa from a U.S. Embassy or Consulate or change status or do anything else that is typically done by those with nonimmigrant visas. Even more, after having the green card for couple of years the green card holder can apply for U.S. citizenship if he or she meets all other requirements.
How can Malescu Law assist you?
The EB-5 green card for the USA requires extensive documentation and expertise in business and immigration to navigate the complex regulations surrounding the investment requirements. The EB-5 investors are often subject to scams and investment fraud and it is recommended to work with an attorney. Our experienced business and immigration lawyers in Miami, Florida can advise you along all steps to obtain the EB-5 green card, prepare the applications and assist you with the EB-5 compliant business plan.
Malescu Law P.A. -Business & Immigration Lawyers