For an immigrant investor hoping to obtain his or her green card though the EB5 visa program, they must first choose an EB5 project and then make the required capital investment. That path to a green card and potentially to US citizenship, begins with the filing of Form I-526, the Immigration Petition for Alien Entrepreneur. That petition must be submitted with accompanying evidence in support of the USCIS EB5 program’s requirements. Upon receipt, the USCIS will evaluate and adjudicate the I-526 petition based upon the following:
Investment Is Made in a New Commercial Enterprise
As an EB5 investor, it is incumbent upon you to prove that your capital investment was made in a New Commercial Enterprise (NCE). An NCE is any for-profit enterprise established after November 29, 1990 (or prior to that date, provided certain conditions were met). The NCE must have been formed for the ongoing conduct of a lawful for-profit US-based business. The business types of the NCE may include, among others, a sole proprietorship, joint venture, general or limited partnership, holding company, corporation, business trust, or other privately or publicly held entity. In the context of a Regional Center, the NCE is the fund in which the immigrant invests. In general, that fund will take the form of either a Limited Liability Company (LLC) or Limited Partnership (LP). In the context of a direct investment, i.e. not through a Regional Center, the NCE is the business wherein the immigrant invests and which will create the required jobs for U.S. workers.
An EB5 visa petition must be supported by proof that the immigrant has invested the required capital. The minimum required investment is $500,000 or $1 million, with the amount dependent upon the project or NCE’s location. If located within a designated Targeted Employment Area (TEA), the minimum investment amount would be $500,000. Outside of a TEA designated area, the minimum investment would be $1 million.
The USCIS requires that the immigrant investor’s funds be deemed “at risk” and irrevocably committed to the NCE. The funds must be used by the NCE to create employment.
Lawful Source of Capital
The funds used by an immigrant for the EB5 investment must be lawfully earned. The investor must be able to provide to the USCIS the sources of the funds for the capital investment in the EB5 project. There must also be clear evidence that those funds were used for the NCE. Sources of funds could come in the form of salary, earnings, investment or business distributions, sale or mortgage of assets or personal property owned by the immigrant investor, or gifts from third parties (provided those funds were also lawfully obtained). Funds earned or obtained by the immigrant investor while in the United States and “out of status” are not considered lawfully acquired.
Active Involvement in the NCE
Direct Investment: Under USCIS rules, the immigrant investor may not have a passive role with regard to his or her direct investment. He or she is required to participate in the management of the NCE. This requirement can be satisfied either through day-to-day management of the NCE or assisting in the formulation of the NCE’s business policy (i.e. having voting rights and exercising same).
Regional Center Investment: In the context of a Regional Center, investors in an EB5 enterprise that is organized, say, as a Limited Partnership, generally have the same rights and duties typically accorded to any limited partner under the respective state’s Limited Partnership Act. The same holds true of the immigrant investor if the NCE was formed as a Limited Liability Company. For the purpose of the EB5 investment this level of involvement, i.e. as a Limited Partner in an LP or as a Member in an LLC, is deemed sufficient by the USCIS.
Direct Investment: In the context of a direct investment in the EB5 project, the NCE must create (or preserve) at least ten (10) direct, full-time positions for qualifying employees for each EB5 immigrant investor. The ten (10) jobs created must be directly for full-time (i.e. not less than 35 hours per week), permanent employees of the NCE. This definition excludes the EB5 investor, his or her family and any non-immigrant alien. At the time of the I-526 petition, if the positions have not yet been created, the NCE’s business plan must contain a thorough description of the NCE’s hiring plan that will show the positions that would be created with that investment and when those positions would be filled. These ten (10) new jobs must be created within two years after the petitioner receives their conditional permanent residency.
Regional Center Investment: In the context of an investment via a Regional Center, the I-526 petition must show that the EB5 investment will create (or preserve) at least ten (10) direct, indirect or induced full-time positions for qualifying employees for each EB5 immigrant investor. The petition should further show that these ten (10) jobs would be created through revenues generated from the Regional Center projects. The number of direct, indirect or induced jobs that are estimated to be created through the EB5 investor’s capital investment is based upon a comprehensive business plan and a detailed economic analysis. The EB5 petition must contain evidence, i.e. a third-party prepared Economic Impact Analysis, which shows that ten (10) direct, indirect or induced jobs will be created for each immigrant investor in the EB5 project. These ten (10) new jobs must be created within two years after the petitioner receives their conditional permanent residency.
If the foregoing requirements are met, then, barring any unforeseen circumstance, the I-526 petition should be approved by the USCIS within 12 to 18 months of initial filing. Once the I-526 petition is approved, if the immigrant investor and his or her family are living abroad, they can apply for an immigrant visa at a U.S. Consulate or U.S. Embassy in their home country. When they lawfully enter the U.S., their status will change to conditional permanent residents of the United States. If the immigrant investor and his or her family are already lawfully residing in the United States, they may petition to adjust their status to conditional permanent residents. Conditional permanent residence is granted for a period of two years; thereafter, the investor and his family must file Form I-829 to have the conditions removed.
Finally, the investor must show the USCIS that the NCE was sustained during the period of conditional permanent residence, that his or her at-risk investment was similarly sustained during that period, and that ten (10) jobs were created as a result of his or her capital investment.