The EB-5 Immigrant investor pilot program (IIPP) which is due to end in 2012, provides the applicant, their spouse and unmarried children under 21 with permanent residence status in the USA in return for an investment of $500,000 in a Government approved regional center program, in a Targeted Employment Area (TEA) or Rural Area (RA).
The EB-5 is an immigrant visa category issued for having made an investment in the United States that creates jobs for others. It is often referred to as the employment creation category.
There are several other visa options available for people who want to manage their own business. Some of the possible options for an EB-5 visa include L-1 visa that is for nonimmigrant intra-company transferee visa; the E-2 visa that is a nonimmigrant treaty investor visa; or the EB-5 visa that requires up to USD$ 1,000,000 investment, via regional centers. However, the EB-5 is an Immigrant Investor category, which involves less risk, more convenience, and requires less investment (i.e. $500,000) to get a permanent resident status. In addition, the investor need not take the burden of managing the business as it is largely managed by the regional center.
The EB-5 visa program provides immense benefits as compared to other conventional U.S. visa programs. The EB-5 visa program comes with following benefits:
- Grant of lawful permanent resident status for investor, spouse, and children (below 21 years of age).
- No language, educational, or employment requirements.
- Investor is not required to manage the business on day to day basis.
- Investor and his family can live and work anywhere across the U.S.
- Investors and their families become eligible to apply for U.S. citizenship subject to meeting all immigration requirements.
There is no specific timeline set for approval of EB-5 investor visa applications. However, the entire approval process takes approximately 9 to 18 months to complete, subject to meeting all immigrant requirements.
Although it comes with immense benefits, the EB-5 investor visa program is not suitable for everyone. To qualify under this program, the investor needs to have sufficient liquid net worth, appropriate financial records, good health, and with no past criminal record. Moreover, certain risk is associated with the investment that is made.
Yes. The USCIS (United States Citizens and Immigration Service) provides 10,000 visas per year under the EB-5 investor visa program. Out of this around 3000 visas are kept reserved for investor wanting to enter the EB-5 Regional Center Pilot program.
While, E2 (treaty/investor) visas grant only nonimmigrant status only to the investor. The nonimmigrant status ends as the investment or business venture ends. Similarly, in case of L-1 (manager transfer) visa, the principal visa holder (i.e. Multinational executives or Managers) is granted a nonimmigrant status (no green card). The EB-5 visa is an immigrant visa category, which grants the investor, spouse, and children (below the age of 21 years) a lawful permanent resident status to the United States of America.
A typical immigration application process under the EB-5 IIPP program involves following steps:
- First phase: During this phase, the regional center studies the investor in detail to ensure that the investor is credible enough to make an investment in regional centers. The regional centers will ensure that the investor has enough liquidity to invest and is a genuine person.
- Second phase: During this phase, the investor submits the I-526 Petition commonly known as “Immigration petition by Alien Entrepreneur”. The USCIS processes this petition. If this petition is approved, the funds are released for investment. If not approved, the funds are returned back to investor.
- Third phase: After the approval of I-526 Petition, the attorney files an I-485 Petition for adjustment of status if the investor is already in USA. If the investor is outside United States, the attorney files an application for immigrant visa at the U.S. Consulate or Embassy in respective country. If visa is approved then the investor, spouse, and children below 21 years of age receive condition lawful permanent resident visa for 2 years.
- Fourth Phase: Three months prior to expiry of condition lawful permanent resident visa, the investor must submit form I-829 (Petition by Entrepreneur to Remove Conditions). If this petition is approved then the investor and his family receives unconditional green cards.
The EB-5 investor visa is meant for foreign nationals who want to invest in U.S. economy that lead to creation of ten full-time permanent jobs. Through this visa, the investors can gain entry into the United States along with their families and children below the age of 21. The eligibility criteria for qualification under EB-5 visa include:
- Should be ready to invest $500,000 in existing enterprises in USCIS designated regional centers or targeted employment areas; or $1,000,000 in new commercial enterprises in any part of U.S.
- The investment should lead to creation of ’10’ full-time permanent jobs for US citizens. The spouse, children, relatives of principal visa holder are not entitled to take up these jobs.
- The source of income should be lawful
- Should clear a thorough background check and medical examination
- Should not have any criminal record or criminal past
- Should be able to actively manage the business as per involvement needed.
The principal EB-5 visa holder who has been granted a conditional permanent resident status is allowed to bring his family along with him into U.S. The investor is allowed to bring spouse, children or stepchildren under the age of 21 years.
The EB-5 investor visa program provides an opportunity to foreign nationals to enter United States by making an investment of $500,000 or $1,000,000. Upon completion of all processes, the investor, spouse, and children or step-children below age of 21 years are granted a conditional permanent resident status for a period of two years. After two years, USCIS thoroughly studies in detail whether the investor has met all the obligations and requirements of the project. If all the conditions are properly met, the investor along with his family is granted an unconditional permanent resident visa. Otherwise, permanent residence is not granted to investor and his/her family.
In order to qualify under the EB-5 investor visa program, the investor is required to invest $500,000 in existing enterprises in USCIS designated regional centres or targeted employment areas; or $1,000,000 in new commercial enterprises in any part of U.S.
Investing USD$500,000 or $1 million, usually in the Escrow account, plus the Syndication fees, in the Regional center of your choice. The syndication fees comprise of Visa Application fees, attorney’s fees, administration fees, etc.
The EB-5 investor visa program wants a proof that the petitioner has put the investment – ‘at risk’. ‘At Risk’ hereby means that the funds have been invested. All evidences proving that the funds have been invested needs to be submitted along with the petition. It needs to be shown that the funds have been used to acquire a business or equipments, materials, facility, and business site. Thus the investment is at-risk in case the business fails.
It depends upon the type of private placement agreement (PPM) with the Regional center. Interest may be payable only if the amount is taken as loan and in that case interest on investment may be up to the prime rate of the banks in the United States of America. However, in other cases like equity, etc. there is no interest proposition and hence return on investment is not guaranteed.
Lock in period would depend on the Private Placement Memorandum (PPM), which is the basis of your agreement signed with the regional center. Normally, it is five years minimum from the date of deployment of funds in the regional center.
Exit Strategy would again depend on the Private Placement Memorandum (PPM), which is the basis of your agreement signed with the regional center. A person may exit after 5 years with his/her investments from the regional center.
The investor must submit full documents while applying for EB-5 visa. The investor must submit complete biographical information and proof that the money that is being invested is from lawful places and is of investor’s. Detailed transaction record of tax returns, business licenses, ownership of proof of any business within the past five years is required. If the funds are acquired through sale of house, inheritance, gift then official documents establishing the transactions done must be submitted. For Application forms and documentation, please contact our team for further guidance.
An Escrow account is a legal account in a reputed and established bank and is bounded by strict governing rules.
The initial deposit from the investor is transferred to the Escrow account, while submitting the application along with list of documents to EB-5 India, if the investor’s eligibility criteria has been met and subject to meeting all other requirements. For details, please contact EB-5 India team of consultants.
The funds from the investor will be held in escrow account during the entire EB-5 visa approval process. When the funds are placed in the escrow account, it continues to belong to the investor. There is an agreement between the bank and the investor that the funds will be transferred to the regional center’s bank account only after the EB-5 application of investor is approved.
The investor is not required to have previous business experience or education.
The investor is not required to speak English and can use the services of a professional translator for any help during visa processing.
Yes. The investor has to prove that he/she is in good health at the time of applying. The investor, spouse, and children below age of 21 years have to undergo physical examination and have to provide medical records for review purposes.
The investor receives a conditional green card for two years because of the specific provisions mentioned in the visa program. These conditions can be imposed again after two years or removed through I-829 Petition. Both conditional and unconditional green cards ensure the same rights and privileges.
One of the main provisions relating to job creation under EB-5 visa program is that the investment should lead to creation of ten full-time permanent jobs, whether direct or indirect for U.S. citizens.
A most common issue is the lack of proper documentation to establish the sources of funds that will be used for EB-5 visa program. Many times investor disc loses less information pertaining to financial history that might further delay the process. It is to be noted that USCIS carries out detailed and thorough scrutiny of financial records provided by the investor.
The investor after issuance of the conditional permanent resident status must enter into U.S. within 180 days after visa is issued. The investor then should form intent to reside by obtaining driver’s license, social security number, paying income tax and much more. The investor and his family who are permanent residents and are living outside the U.S. must come to U.S. at least once every 6 months. The investor and their family may face risk to their green card status if they spend less time in United States.
Once a green card is granted to an investor then he/she is considered as resident of the United States. The problems may arise once the investor is outside of United States for more than 6 months without informing the USCIS about the plans in advance. If the investor is travelling outside U.S. for more than 6 months then USCIS can consider this as absence from U.S. and it better to obtain a “re-entry” permit prior to departure. If the investor is outside of U.S. for more than a year then the investor may face difficulty re-entering as USCIS considers absence of more than one year as possible abandonment of U.S. residence. It is better to return to the United States within six months.
If the investor is travelling for more than a year, it is better that he/she applies for a re-entry permit (form I-131) before leaving the United States. The re-entry permits are issued for a period of two years. The re-entry can not be renewed but the investor has to again apply for a new one. The investor must return back to United States before the expiry of the permit.
The investor and his family initially receive conditional green cards for 2 years through EB-5 investment visa program. Three months before the termination of 2 year period, the investor must apply for removal of condition on the green card. If the conditions are not removed at the end of the 2 years then the conditional green cards become invalid and the permanent resident status of the investor is terminated. Once condition is removed, the investor and his family members receive unconditional green cards which are valid for ten years.
I-526 Petition is commonly known as “Immigration Petition by Alien Entrepreneur” that the investor has to submit along with documents in support of EB-5 investor visa requirements. After approval of the EB-5 investor visa application, which takes around 18 months to complete, the investor and his family members can apply for an immigration visa. During the entire process, the USCIS scrutinizes the I-526 application on following criteria:
- New commercial enterprises
- Investment made
- Documents establishing legal source of capital or funds.
- Amount of Investment done (i.e. $1,000,000 in U.S. or $500,000 in regional center or TEA)
- Creation of ten permanent job for U.S. citizens
When the investor is staying outside of United States, then the entire processing of immigration visa application is done in the respective country of origin in which the investor is staying. This is called as consular processing.
When the investor and the family members are already present in the United States and the EB-5 visa has been approved for them, then the investor can file an I-485 Petition for adjustment of status from non-immigrant status to conditional permanent resident status.
Upon grant of EB-5 visa, the investor, spouse, and children below the age of 21 years can apply for immigrant visa and receive conditional permanent residence for a period of 2 years. These conditions need to be removed in order to enable the investor and family members to remain in the U.S. permanently. For this, three months prior to expiry of conditional permanent residence status, the investor must file an I-829 Petition for remove of conditions. USCIS then scrutinizes the investment done and ensure that it has met all the standard requirements. Once the I-829 Petition is removed, the investor and family members are granted unconditional permanent resident status.
Once the investor receives permanent residency (green card) then two conditions must always be met to ensure that it can not be taken away
- First one is that the investor must not become removable or prohibited. Getting convicted in a criminal activity can lead to removing or prohibition.
- Second one is that the investor must not abandon United States as their permanent residence. Once the investor and family members make another country their home, they cease to become permanent residents of the United States.
Once the investor files an I-829 Petition for removal of conditions on his/her conditional permanent resident status to convert into unconditional permanent resident status (green card), then this unconditional permanent resident status is valid for 10 years. After ten years, the investor only needs to renew his/her status but continues to remain a legal permanent resident.