Since the Immigration Act of 1990 (IMMAC 90) established the EB-5 Investment Visa program, otherwise known as the Immigrant Investor Program, with an initial 10,000 visa allotment to foreign investors wishing to participate, the program has had varying degrees of success. In fact, the EB-5 Investment Visa program was suspended in 1998 due to fraudulent practices that did not create employment in the U.S.A., which largely is the intent of the program. Reestablished in December 2003, it is now under the supervision of the U.S. Citizenship and Immigration Services (USCIS) and has gained traction in the past few years due to the expanding number of global non U.S. millionaires.
The great advantages of the U.S. EB-5 Investment Visa Program is that, not only can the potential for profits be realized, it can be the ticket to U.S. permanent residency. Spouses and children under the age of 21 are also covered under the program and relocate to the U.S. along with the applicant.
Requirements of the U.S. EB-5 Investment Visa Program
- Investment of $500,000 in a new commercial enterprise in a “targeted employment area”, defined as a rural area or any area with a 150% unemployment rate compared to the national average rate, and create 10 qualified jobs. The term new can be broadly interpreted and can encompass an existing or troubled business.Expanding an existing business may also qualify if the net worth of the enterprise or the number of employees increases by 40%.
- Investment of $500,000 in a government designated Regional Center and bypass the 10 jobs requirement. Indirect job creation is also allowed.
- Investment of $1,000,000 in any business and create 10 jobs. Caveat: the U.S. Attorney General has wide discretion over this matter and can increase the minimum investment required, although this is a rare occurrence.
- Investors have up to two years to complete the 10 jobs requirement.
- Investment capital can be in any form, and proof will have to be presented that the capital was derived from legal means.
- The investment must be “at risk”, as legally defined.
The application process generally takes 9 to 12 months to complete, then conditional residency is established. These “conditions” can be removed after 1 year and 9 months, leading to permanent residency, meaning that the visa is no longer tied to the investment. U.S. citizenship can be applied for beginning in 5 years after issuance of the green card. In sum, approximately 8 years to U.S. citizenship.
The U.S. EB-5 Investment Visa Program is due to sunset, or expire, on September 30, 2012, unless extended. In this matter, the program has a strong advocate in Senator Leahy(D-Vermont) who has introduced SB 642, which aims to make the EB-5 program permanent.