The first step in the EB-5 visa process is the irrevocable commitment of investment funds in a new commercial enterprise (NCE) in the United States. After that, investors must submit Form I-526, Immigrant Petition by Alien Investor. In this form, investors should include details about the terms of the project they have invested in. In addition, foreign nationals should include documentation supporting the fact that their funds have come from credible sources and that the applicable taxes have been paid. This form is reviewed by United States Citizenship and Immigration Services (USCIS) and, should it determine that their requirements were met, the investor and their immediate family members are granted a two-year residency status.
Although it is a safe pathway to U.S. permanent residency, the EB-5 investment process is not without its challenges. USCIS carefully scrutinizes every detail of Form I-526 and, if they find that there is information missing or something was done incorrectly, they may send a request for evidence (RFE). This doesn’t necessarily mean that the petition will be denied, but it does add another layer of time to a historically slow process.
In order to avoid additional requests for information, potential investors and their immigration attorneys should pay careful attention to an aspect of Form I-526 that demonstrates the financial viability and stability of the EB5 investment project: the business plan.
Potential for Financial Success
A solid EB-5 investment project business plan will show USCIS that the project will successfully meet the job creation criteria, have a positive impact on the economy, and be financially viable. In order to do that, the business plan has to detail how the NCE will operate, including a marketing strategy, a projected budget, and a market analysis from a third party. All aspects of the business plan are important, but the market analysis supports the project developers’ projections for the NCE’s success. The projects most likely to receive approval are the ones that are only using the EB-5 investment funds as a small portion of the business’ overall capital. An overdependence on EB-5 investment funds shows that the business is not financially viable.
Another key factor to keep in mind is consistency throughout the business plan. These may seem like harmless mistakes, but if the information contained in the business plan is not consistent, USCIS is likely to deny the petition. It is in the best interest of the project developers and investors to carefully look over the petition and ensure there are no discrepancies.
Meeting EB-5 Investment Regulations
Prior to irrevocably committing their funds, investors should consider several factors. It is critical that the EB5 investment project not only be a sound, financially viable business, but that it also meets USCIS regulations. One example is ensuring that the NCE can created the required minimum of 10 jobs per investor. In addition, investors should ensure that they’ve met the required minimum investment threshold which, as of March 2022, is $1,050,000 for projects that are not in a targeted employment area (TEA). Projects that are in a TEA have an investment threshold of $800,000.
Meeting the job creation requirement is a key obligation of every EB-5 investment project. After all, the program was created to benefit the U.S. economy while also providing a pathway to U.S. residency for foreign nationals. The minimum of 10 jobs must be available for the entirety of the two-year conditional residency period granted to investors and must be filled by persons who are lawfully authorized for employment in the United States. In addition, the type of employment that can be counted towards the required minimum will depend on the investment model that is being used. The regional center model allows for indirect and induced employment (those that are created by the NCE’s overall economic impact) to be counted. By contrast, direct investments only allow jobs that are directly created by the NCE to count towards the required minimum.
The EB-5 visa process can at times seem overwhelming, which is why it is recommended that foreign nationals choose an immigration attorney with substantial expertise in the industry to guide them through the process.
