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Pending I-526 Petitions from Regional Center Investors: An Urgent Issue in the EB-5 Industry

Solving Issues in the EB-5 Program

The days before the June 30, 2021, suspension of the regional center program were busy for EB-5 project developers. Many foreign nationals rushed to file their I-526 petitions at a reduced amount before the EB-5 program’s most popular investment option became unavailable. As regional center-sponsored projects offered their investors light managerial requirements and were allowed to use very flexible job creation criteria, most foreign nationals chose to invest through regional centers when pursuing the EB-5 visa.

This enthusiasm, however, was short-lived. Even though the industry as a whole expected Congress to reauthorize the regional center program in a few short months, it has been defunct for over six months at the time of writing. An appropriations bill due in December 2021 was ultimately postponed, leaving the EB-5 industry without a convenient legislative vehicle to pass reform.

Since the second half of 2021, the EB-5 industry has still attracted millions of dollars of foreign investment capital, and foreign nationals are now more aware of and comfortable with the direct EB-5 investment model.

But what about the regional center investors whose I-526 petitions were being processed as of June 30, 2021?

United States Citizenship and Immigration Services (USCIS) is no longer processing I-526 petitions from regional center investors. As a result, these foreign nationals, who made EB-5 investments in good faith and in compliance with USCIS guidelines, now find themselves unable to continue with the EB-5 process.

What consequences could this situation have on the EB-5 investment industry, and how could it be solved?

Potential Consequences for EB-5 Projects

The longer regional center investors remain in processing limbo, the more likely it is for them to try to regain their invested capital. If USCIS takes a step further and denies these I-526 petitions, then numerous EB-5 projects could face litigation. This scenario would surely undermine the EB-5 investment program’s image and discourage potential investors from pursuing the EB-5 visa. Worse still, the U.S. economy would lose out on billions of dollars of valuable funding.

Alternatives to Reauthorizing the Regional Center Program

The most straightforward way to get regional center investors back on track would be for Congress to revalidate the regional center program. However, it has usually been difficult for the U.S. government to reach a consensus on what changes should be made to the EB-5 program. EB-5 reform is usually attached to a larger legislative vehicle; it is very unlikely for it to pass Congress on its own. Therefore, it remains unclear when the regional center EB-5 investment model will achieve reauthorization.

Given this uncertainty, many EB-5 industry members have sought to promote legislative action that would allow investors with valid I-526 petitions to continue with the EB-5 process regardless of whether the regional center program is authorized. Such a measure would surely restore investors’ confidence in the regional center program.

Even if no legislation aiding regional center investors is successful, it seems that USCIS may begin to process pending regional center petitions in the coming weeks or months: the agency released a statement in December 2021 announcing that it was “reevaluating” its policy of not acting on I-526 forms associated with regional centers.

In the meantime, the EB-5 industry is enjoying the many benefits of direct EB5 investment, including a more permanent and quantifiable impact on the U.S. economy, more transparent job creation, and permanence—the direct EB-5 model does not depend on reauthorization.

Even if provisions are made for regional center investors, EB-5 investors may now view the direct model as more secure and reliable. It may become the preferred investment model for foreign nationals seeking the lowest possible risk.

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Solving Issues in the EB-5 Program

Solving Issues in the EB-5 Program

The thousands of foreign nationals who have completed the EB-5 process and are now enjoying permanent residency in the United States can attest to the fact that making an EB-5 investment is worthwhile. However, many of them would also agree that obtaining the EB-5 visa is a lengthy and not always straightforward process. United States Citizenship and Immigration Services (USCIS), along with the Department of State (DOS), have much to do in terms of improving the EB-5 investment program and making it more beneficial for investors, business owners, and local economies across the United States.

Admittedly, the EB-5 industry has had to contend with many sudden changes in the past few months. The most important of these was the June 2021 suspension of the regional center investment model, which left numerous regional center investors in a state of uncertainty: USCIS is no longer adjudicating their I-526 petitions, and it is unknown if or when the agency will reconsider this policy. Moreover, reauthorization for the regional center program is not guaranteed.

Aside from this recent issue, the EB-5 investment program has long been plagued by visa backlogs and lengthy processing times. It typically takes years for USCIS to adjudicate an investor’s Form I-526, and many countries have been subject to processing backlogs that impose even longer delays.

USCIS and the DOS should take action to address these issues and protect the interests of all EB-5 stakeholders. In fact, taking relatively simple steps could greatly reduce or even eliminate the aforementioned problems.

Expanding EB-5 Visa Allocation

Each year, the EB-5 investment program is awarded only about 10,000 visas. This number is not nearly enough to cover the huge demand for the EB-5 visa, especially from residents of Brazil, India, Vietnam, and China. All individuals who make an EB-5 investment are directly contributing to the well-being of the U.S. economy, so it is in the country’s interest to take on as many EB-5 investors as possible. Many small businesses, especially in targeted employment areas (TEAs)—which are either rural or have high unemployment—have found invaluable help in the form of EB-5 investment funding. This economic stimulus is especially important during the challenges caused by the COVID-19 pandemic.

USCIS and the DOS could choose to allocate more visas to the EB-5 program each year, perhaps awarding the program with some of its visas that have gone unused in previous years. They could also choose to consider every EB-5 investor and their family as one visa applicant. These approaches would allow far more visas to be awarded each year.

USCIS also has much to do in terms of improving the slow processing times for Form I-526, Immigrant Petition by Alien Investor. Some investors have even felt impelled to file mandamus litigation against USCIS due to the unreasonable delays. Expediting processing times would allow investors to receive their two-year conditional permanent residency much faster and make the EB-5 visa a more attractive option for foreign nationals.

Making Provisions for Regional Center Investors

As mentioned previously, USCIS has left regional center investors with pending I-526 petitions in a state of uncertainty. Because it is unclear if or when the regional center program will be revalidated, the agency should allow these investors to continue with the EB-5 process. Doing so is urgent because these foreign nationals may eventually try to get their EB-5 investment funds back through legal action, leaving EB-5 projects in an uncomfortable position.

The EB5 investment industry is far from perfect, but, despite the challenges, it continues to aid businesses across the United States. Its continued success is in the best interests of all involved.

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EB-5 Program an “Examination Priority,” Say SEC and Others

EB-5 Program an “Examination Priority,” Say SEC and Others

The EB-5 Immigrant Investor Program was initially enacted in the 1990s as an economic stimulus effort in the United States. The primary objective of the program was to obtain foreign capital investment and utilize that money to create jobs and improve local economies across the country.

In exchange for a capital investment in a program-approved venture that creates at least 10 new, sustainable jobs for U.S. workers, foreign investors and their eligible family members become eligible for U.S. Green Cards. This immigration program is administered and overseen by United States Citizenship and Immigration Services (USCIS) under the Department of Homeland Security (DHS).

For nearly three decades, EB-5 investment activity was generally limited. However, due to financing issues for domestic real estate developers during the Great Recession, emerging wealth among Chinese EB-5 visa applicants became a driving force in the flourishment of the EB-5 program.

By now, the EB-5 industry is used to being in the spotlight, and not always for positive reasons. But how did this economy-building program land on the radars of the United States’ most prominent investigative agencies?

The EB-5 Industry Struggles with White-Collar Crimes

The EB-5 program has been responsible for creating more than one million jobs through the infusion of approximately $40 billion in EB-5 investments from 2008 to 2020. In tandem, however, it has developed a reputation for being associated with economic crimes like fraud and money laundering.

As a result, the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) named the program an “examination priority” in 2016. And Texas business investors seem to be particularly popular subjects in investigations like these. Despite the successful creation of more than 14,000 Texas jobs, there have also been a number of criminal investigations opened in that state.

Dallas Developer Faces Commissions Claim

One Dallas developer is facing a $1 million-plus claim that it owes finders’ commissions for its foreign investors in a downtown Dallas hotel redevelopment project. The SEC has partnered with the Internal Revenue Service (IRS) on an investigation into the financing of the hotel.

McAllen Couple Accused of EB-5 Fraud

In a 2013 case, SEC v. Marco A. Ramirez, a McAllen, Texas couple was charged with fraud in one of the very first significant federal enforcement actions concerning the EB-5 program. The defendants were accused of committing fraud crimes in order to obtain $5 million from Mexican, Egyptian, and Nigerian investors. They had promised these foreign investors to invest their capital into EB-5 projects but instead used the funds for personal gains—like their Texas-based Cajun restaurant.

The real take-away among these cases is that industry experts do not see EB-5-related enforcement actions by the SEC and other agencies slowing anytime soon. For this reason, as EB-5 Immigrant Investor Program participants, it is important to understand what types of enforcement actions are surfacing most frequently, and what they can do to help avoid becoming a party of interest in these types of investigations.

Common EB-5-Related Enforcement Actions

Unregistered broker-dealers are prohibited from earning commissions from security-based transactions in the United States. Because the majority of EB-5 financing scenarios are structured as securities offerings, these deals are highly susceptible to enforcement actions against EB-5 program participants. These cases are typically related to investor placement commissions paid to unregistered broker-dealers.

Why are these deals happening so often? The answer is simple: this structuring can be very lucrative for investment finders. Most EB-5 investment applicants prioritize their Green Cards over a monetary return on their investment. Typically, EB5 investment participants’ returns gross between 1% and 2% each year. Because of the lower expectation among investors on actual investment returns, the ultra-high placement commissions, which frequently exceed 20% of the total investment amount, become less of an issue for project developers.

Civil Litigation Also Spikes in the EB-5 Community

In addition to enforcement of regulation and criminal laws, the EB-5 community has also seen a spike in civil litigation. A pattern is emerging in which federal enforcement action is being taken directly following civil litigation as allegations surface from plaintiffs participating in the EB-5 investment program. A number of industry experts believe this is only the beginning of a trend we can expect in the wake of the completion of many projects that began during the EB-5 boom between 2012 and 2018.

EB5AN Keeps EB-5 Industry Members Informed

As industry advocates continue to lean on legislating bodies, EB5AN watches closely in order to keep its investors abreast of industry developments. Stay informed by frequenting our regularly updated blogs, and, for any specific questions regarding your own EB-5 investment, feel free to reach out!

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USCIS Cancels Appeal Against Modernization Rule Court Ruling

USCIS Cancels Appeal Against Modernization Rule Court Ruling

Since June 2021, EB-5 regulations and procedures have undergone several changes, many of which have been unexpected. Still, project developers and investors have benefitted from the June 22, 2021 repeal of the EB-5 Modernization Rule. This court ruling found that the Modernization Rule had been implemented improperly in November 2019. As a result, EB-5 investment regulations reverted to their pre-November 2019 status.

However, United States Citizenship and Immigration Services (USCIS) filed an appeal against the court’s decision on August 23, 2021. If successful, this appeal would have brought back Modernization Rule guidelines and had a significant impact on the EB-5 industry; for instance, individual states would no longer be authorized to designate targeted employment areas (TEAs). More importantly, the minimum EB-5 investment thresholds of $500,000 for TEA projects and $1,000,000 for non-TEA projects would have been raised to $900,000 and $1,800,000, respectively. In the past few months, foreign nationals from a variety of countries have been able to invest in U.S. businesses and begin the EB-5 visa application process thanks to these reduced investment thresholds.

To the relief of many EB-5 professionals, USCIS withdrew its appeal against the Modernization Rule court ruling on January 5, 2022. It seems that the lower investment amounts and other pre-November 2019 regulations will remain in place for the time being. Both foreign nationals interested in the EB-5 investment visa and U.S. business owners in need of investment capital will benefit from the more accessible investment threshold of $500,000.

Could the Modernization Rule be Reimplemented?

Despite the withdrawal of USCIS’s appeal, the EB-5 industry still faces the possibility of going back to Modernization Rule guidelines. USCIS or the Department of Homeland Security (DHS) could take legislative action to raise the EB-5 investment thresholds once more. In fact, an appropriations bill due in February 2022 might be an ideal vehicle to pass legislation reforming the EB-5 program. Of course, it is unclear if or when USCIS or the DHS will take such action.

In the meantime, foreign nationals who wish to make an EB5 investment at only $500,000 should act quickly to find a suitable project. Due to the legislative lapse of the EB-5 Regional Center Program, all EB-5 investments must be direct for the time being. The direct investment model offers several enticing benefits for investors and project developers.

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An Overview of the EB-5 Program and the Conversations Surrounding It

An Overview of the EB-5 Program and the Conversations Surrounding It

The EB-5 program, as it’s typically known, is officially the EB-5 Immigrant Investor Visa Program or “employment-based fifth preference category.” The program was born in 1990 when Congress designed it to incentivize foreign investment in the U.S. economy, creating new jobs for U.S. workers. In exchange for their qualifying EB-5 investment, foreign nationals would be granted U.S. green cards, allowing them—and their spouse and unmarried children younger than 21—to live and work indefinitely in the United States. Initially, an investor and their family are only granted conditional permanent resident status, but if they can prove their EB5 investment fulfilled the program requirements at the end of their two-year conditional residency period, they can apply to remove the conditions and become fully fledged U.S. permanent residents. Denial of the I-829 petition to remove conditions—or failure to file it—results in the expulsion of the foreign national and their family from the United States.

Who Uses the EB-5 Program?

For the first two decades of its existence, the EB-5 program was severely underused. The program’s existence was not common knowledge, and many foreign nationals unfamiliar with this type of immigration model were skeptical of the program. Until the 2010s, the EB-5 program routinely failed to dole out the 10,000 visas it was allocated every fiscal year. The vast majority went to Chinese EB5 investment participants—China’s massive population and authoritarian government provide both a huge market and a good incentive to make an EB5 investment, and immigration agents across the country promoted the EB-5 program as a high-quality pathway to a life in the United States.

More recently, however, many investors from India, Brazil, South Korea, and Vietnam have been obtaining a larger share of the EB-5 visa pool. The EB-5 program has experienced far more popularity since the 2010s, and foreign nationals from a wide variety of countries are participating.

The EB-5 Regional Center Program

In 1992, Congress introduced a supplementary program to the EB-5 program—the EB-5 Regional Center Program. The regional center program would go on to steal the spotlight, with regional centers accounting for almost all EB5 investments (96% in FY2019). An EB-5 regional center is a commercial entity that partners with EB-5 project developers and attracts EB-5 investors to invest in them, pooling together capital from multiple investors to make larger EB-5 investments. The regional center acts as an important intermediary in the EB-5 investment process, with continued approval from United States Citizenship and Immigration Services (USCIS) dependent on its ability to drive economic growth in a specified region.

However, the regional center program depends on periodic government reauthorization. Congress failed to reauthorize the program before the June 30, 2021 deadline, so this investment model has been defunct for over six months as of January 2022. All EB-5 investments must be direct for the time being, and it is unclear when the regional center model will return.

Opinions on the EB-5 Program

The EB-5 program has brought millions in foreign investment capital to the U.S. economy since its inception, creating hundreds of thousands of new jobs for U.S. workers. It has allowed project developers to access relatively cheap investment capital when traditional funding was not available, such as after the 2008 financial crisis. And it has helped hundreds of thousands of foreign nationals set up a new life in the United States, enjoying a life of freedom and a brighter future for their children. Indeed, many highlight the benefits of the EB-5 program, adding that the various requirements of the program, such as the need to prove the lawful sources of EB5 investment capital, protected the program’s integrity.

Others have been critical. The EB-5 program is often demonized in the media, which focuses on a few isolated cases of fraud instead of the thousands of cases of honest, good-faith developers and investors. Some critics denounce EB-5 as a scheme to buy residency in the United States, and some have voiced concerns about foreign adversaries, such as the Chinese Communist Party (CCP), abusing the program to obtain permanent residency for its members.

To ignore cases of fraud, however rare they may be, or the potential security concerns the program may cause would be irresponsible. Indeed, EB-5 stakeholders readily recognize the flaws in the EB-5 program and push for sensible reform. After all, the EB-5 program has had a myriad of positive impacts—on the U.S. economy, for U.S. jobseekers, and for the individual developers and investors alike—all at no cost to the U.S. taxpayer. The EB-5 community urges Congress and the public to recognize the benefits of the EB-5 program and to work to improve the program, not demolish it.

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February 2022 Visa Bulletin: Direct EB-5 Dates Are Still Current

February 2022 Visa Bulletin: Direct EB-5 Dates Are Still Current

The Department of State (DOS) has published the Visa Bulletin for February 2022. The monthly Visa Bulletins provide U.S. visa applicants with valuable information on when they will be eligible to receive their visas. For the EB-5 industry, these reports indicate which investors are eligible to apply for or receive conditional residency status.

Chinese investors had been subject to a processing backlog since 2015 and were therefore subject to delays when applying for and receiving their visas. However, the December 2021 Visa Bulletin brought welcome news: all direct investors, including those from China, would no longer be subject to processing delays. As of the February 2022 Visa Bulletin, direct investors of all nationalities are still free from cutoff dates. They can go through the EB-5 investment process without the inconvenient delays caused by processing backlogs.

The DOS and United States Citizenship and Immigration Services (USCIS) may be expediting direct EB-5 visa petitions due to the expiration of the regional center investment model. Before the June 30, 2021, suspension of the regional center program, most EB-5 investors had chosen regional center-sponsored projects to benefit from the more accessible job creation requirements. Now, I-526 petitions from regional center investors are no longer being processed, thus allowing USCIS to focus on adjudicating visa petitions from direct investors.

It is unclear what will happen to the cutoff dates for Chinese investors when the regional center program is reauthorized. Some industry members expect Congress to reauthorize regional center EB-5 investment in February 2022, but such predictions are conjectural.

Chart A

This section of the Visa Bulletins shows when investors from backlogged countries can receive their conditional permanent resident status. All direct investors are currently granted current status, meaning that they do not have to wait to receive their visas once USCIS has approved their petitions. On the other hand, regional center investors are unauthorized.

Chart B

Chart B contains the date for filing, which dictates when investors from backlogged countries can submit their applications for conditional permanent residency visas. As in Chart A, all direct investors, including Chinese nationals, have current status. In contrast, Chinese regional center investors are subject to a date for filing of December 15, 2015.

Foreign nationals interested in the EB-5 program may have an invaluable opportunity to make a direct EB-5 investment; Chinese investors will especially benefit from the absence of cutoff dates. Moreover, direct investments can currently be made at only $500,000.

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The EB-5 Program: The First Step Toward U.S. Citizenship

The EB-5 Program: The First Step Toward U.S. Citizenship

All around the world are foreign nationals dreaming of a life in the United States. Unfortunately, for most, the dream is unattainable—but for a select few, it can become a reality. The EB-5 Immigrant Investor Program has been the key to the United States for thousands of foreign investors, who have earned green cards for themselves and their immediate family members through largely passive EB-5 investments. But for many, U.S. permanent resident status isn’t the ultimate goal. Many have their sights set on U.S. citizenship.

Permanent residents in the United States enjoy most of the same rights and freedoms as U.S. citizens, including the right to live, work, study, or travel anywhere in the United States. With a green card, children can also attend U.S. public school, and the admissions process to U.S. colleges is usually significantly easier. However, green card holders cannot vote or run for federal office, and they face restrictions on how much time they can spend abroad. U.S. citizens can also petition to bring family members to the United States much more quickly than permanent residents.

Making an EB-5 Investment

Only permanent residents can apply for naturalization, so the first step for any foreign national is to obtain U.S. permanent resident status. The EB-5 program makes this relatively simple and easy compared to other immigration pathways. An investor must take care to fulfill certain EB5 investment criteria, but with proper due diligence, most applicants succeed with their EB-5 investments.

The minimum EB5 investment amount is $500,000, if the project is in a targeted employment area (TEA). The amount doubles to $1,000,000 if the project does not quality for TEA status. An investor must also provide evidence of the lawful sources of the capital and maintain it at risk for the entirety of the investment period. Issuance of permanent resident status is contingent on the creation of at least 10 jobs for U.S. workers. If an EB-5 investor fulfills these requirements, they will earn green cards for themselves as well as their spouse and any unmarried children younger than 21.

Requirements for U.S. Naturalization

An applicant must satisfy several requirements before they are eligible to apply for U.S. citizenship. The most important one is the acquisition of a green card, which is the most challenging step for most immigrants, potentially taking more than a decade. Those who have made EB-5 investments, on the other hand, can often receive their green card in just two years.

After obtaining permanent residency rights, a foreign national must reside in the United States for at least five years to be eligible for citizenship. Travel abroad is permitted, but permanent residents must be careful—spending more than six months out of the country at a time could jeopardize their green card status. Additionally, a permanent resident must have spent at least 30 months of the past five years physically in the United States to qualify for naturalization. While EB-5 investors initially receive two-year conditional permanent resident status, these two years count toward the five years of permanent residency necessary for naturalization eligibility, allowing EB-5 investors to start working toward eligibility for U.S. citizenship as soon as they enter the United States.

Just like the EB-5 investment visa itself, the U.S. naturalization process is open to both an investor and their accompanying family members, meaning the entire family can obtain U.S. citizenship in just five years from the initial relocation to the United States. Consulting with an experienced EB-5 immigration attorney is always encouraged, however, to determine the best course of action for you, your family, and your goals.

The Naturalization Process

Upon living in the United States on a green card for at least five years, an EB-5 investor may submit Form N-400 to initiate the naturalization process with United States Citizenship and Immigration Services (USCIS). An applicant may file the petition from any state, but they must have resided in that state for at least three months before submitting the form.

The next step is to set up an interview with USCIS and undertake the citizenship exam. Applicants must demonstrate at least a basic ability to use English and fundamental knowledge of U.S. history and government structure. These factors will influence USCIS’s adjudication of an N-400—following the interview and exam, USCIS will issue a decision. If an applicant’s petition is approved, they must take an Oath of Allegiance to the United States, and that’s it—they’re finally U.S. citizens and may enjoy all the rights that come along with U.S. citizenship.

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Fulfilling the Source-of-Funds Criteria

Fulfilling the Source-of-Funds Criteria

The opportunity to achieve permanent residency in the United States appeals to millions of foreign nationals, and the EB-5 investment program is one of the most attractive visa-by-investment systems. Making an EB-5 investment can even lead to eventual U.S. citizenship. Since its inception in 1990, the EB-5 investment program has successfully granted permanent resident status to thousands of investors from around the world.

This program is carefully regulated by United States Citizenship and Immigration Services (USCIS). Participation requires meticulous planning to ensure that the EB-5 investment fulfills all applicable USCIS criteria.

The adjudication of I-526 petitions is one of the key roles carried out by USCIS to ensure that all EB-5 projects and their investors adhere to its guidelines. USCIS places great importance on making sure that all EB-5 funds originate lawfully, and investors often encounter problems when trying to prove the origin of the funds they used for their investment. Indeed, proving that EB-5 funds were sourced legally can be challenging.

Regulations on EB-5 Sources of Funds

Form I-526 should trace the capital from its origin up to the point of investment. This requires carrying out rigorous research and compiling many documents. Due to the complexities of the process, EB-5 investors should seek guidance from an immigration attorney.

The evidentiary standard set out by USCIS dictates that EB-5 investors must demonstrate that their capital was obtained lawfully based on “a preponderance of the evidence.” This means that the proof and documentation provided should be thorough enough for USCIS adjudicators to conclude that the funds were most likely obtained in a legal manner. Of course, it is always safest to provide USCIS with a surplus of evidence; investors should provide more documentation than required rather than fall short.

How to Submit the Required Evidence

EB-5 investors must provide documents that accurately trace the source of their funds. Fortunately, USCIS places no restrictions on which sources of funds can be used for an EB5 investment as long as the sources are lawful.

No matter what source of funds they choose, all EB-5 investors must submit their tax returns for the last five years in Form I-526. If their funds come from multiple sources, investors must provide the relevant documentation for each source of income. In addition, if an EB-5 investor comes from a non-English-speaking country, they must provide a translation of all the attached evidence.

One of the biggest challenges for prospective participants in the EB-5 program is compiling a thorough and convincing I-526 petition. EB5AN, a leading consulting firm in the EB-5 industry, has helped many investors succeed in the EB-5 process and obtain their coveted U.S. green cards.

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First Steps in the EB-5 Process

First Steps in the EB-5 Process

The EB-5 investment program has enabled thousands of foreign nationals to relocate to the United States and acquire permanent residency. While United States Citizenship and Immigration Services (USCIS) lays out clear regulations for the program, the EB-5 process is complex and time consuming. Moreover, if an EB-5 project fails to comply with USCIS regulations, its investors’ visa petitions may be denied.

Because of the complexity of the EB-5 process, prospective investors are advised to work closely with an experienced immigration attorney. It is also important for them to begin preparing as early as possible so that they can start gathering the documentation they will need later in the process.

In this article, we describe the early preparations that prospective EB-5 investors should make and how they can begin the EB-5 process.

Preparing for the EB-5 Process

First, interested foreign nationals need to determine whether the EB-5 visa is a viable immigration option and hire an immigration attorney. They should examine the source of funds that would be used to make an EB-5 investment as well as the minimum investment thresholds: $500,000 for targeted employment area (TEA) projects and $1,000,000 for non-TEA projects.

Having hired an immigration attorney and examined basic requirements for EB-5 investors, interested foreign nationals must then select a suitable EB-5 project. They should carefully examine the details of each option and determine whether the project fulfills EB-5 criteria, especially the requirement to create 10 qualifying U.S. jobs.

Making an EB-5 Investment

Having selected a qualifying EB-5 business, investors must then subscribe to the project and make their investment. Then, they must prepare to file Form I-526, Immigrant Petition by Alien Investor. In this petition, the investor must provide details such as how the funds will be used and prove compliance with the at-risk requirement. Proving that the funds were sourced lawfully can be particularly challenging.

Preparing the source-of-funds documentation to meet USCIS’s high evidentiary standard can take some time. Investors are advised to start preparing this material as soon as they decide to pursue the EB-5 investment visa. Their immigration attorney will be able to advise on exactly what documentation is required, depending on the specific source of capital used in the investment.

The path to obtaining permanent U.S. residency through the EB5 investment program can be complex. However, with the help of an experienced attorney, foreign nationals will be able to navigate this process with confidence.

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Attracting EB-5 Investors

Attracting EB-5 Investors

Since its launch in the 1990s, the EB-5 investment program has brought investors from all over the world to the United States. Foreign investment in qualifying EB-5 businesses has helped the United States’ economy and reduced unemployment. This capital is usually offered at below-market rates, which is advantageous for U.S. business owners. In addition, businesses receiving EB-5 investment capital are required to generate at least 10 full-time jobs.

Recent changes to the regulations of the EB5 investment industry have increased interest in the program. The repeal of the Modernization Rule in June 2021 reduced the minimum investment threshold from $900,000 to $500,000 for business projects located in targeted employment areas (TEAs). This makes the EB-5 program more accessible to interested foreign nationals.

EB-5 investments can be an excellent source of funding. However, in order to qualify for the EB-5 program, business owners must plan their projects carefully to ensure compliance with United States Citizenship and Immigration Services (USCIS) regulations and make their offerings attractive.

How to Make an EB-5 Project Attractive to Investors

EB-5 investors tend to look for safe investment opportunities that provide them with the most benefits. Many foreign nationals value their eligibility for U.S. citizenship more than the return on their investments, so they look for projects with low immigration risk. The best projects, therefore, comply with all USCIS regulations and have viable business plans.

Another thing that foreign nationals look for when evaluating EB-5 investment opportunities is the business’s ability to generate jobs. As each EB-5 investment needs to create at least 10 jobs, projects that allow for the creation of large numbers of jobs are more likely to guarantee that each investor’s quota is met early on. Such projects have an especially low immigration risk.

Marketing Your Project

EB-5 projects require a carefully devised marketing strategy. EB-5 business owners must create marketing materials that appeal to their target audience. This may include brochures and other printed materials translated into the potential investors’ native language. As many potential investors do research on available projects from overseas, EB-5 projects must have a strong online presence to catch their attention. Informational videos, for instance, can help business owners engage investors. Seminars, conducted online or in person, can be a good way for business owners to interact directly with their potential investors and answer their questions.

EB-5 capital provides significant benefits to U.S. businesses. Of course, creating and marketing an EB-5 project that follows all USCIS regulations can be challenging. Business owners are advised to consult with an immigration attorney and EB-5 specialists.