What is an EB-5 Investor Visa?

The EB-5 investor visa program enables foreign entrepreneurs who make an investment in a U.S. business to obtain their green cards to become lawful permanent residents of the United States. EB-5 visa holders can permanently live and work in the United States with their spouse and unmarried children under the age of 21. The EB-5 visa program, which is also designated as the Employment-Based Immigration: Fifth Preference immigrant investor program, is operated by the United States Citizenship and Immigration Services (USCIS). The program was established by the United States Congress in 1990 to facilitate increased investment in the U.S. economy. Several reforms have been made to the program over the years to increase demand for EB-5 visas. Such reforms include the establishment of EB-5 Regional Centers through a Pilot Program.

EB-5 Visa Immigrant Investment Requirements

To meet EB-5 investor visa requirements, foreign investors must make a capital investment in a for-profit U.S. business entity. The required investment amount depends on the location and type of business that receives the investment. In general, the capital investment must be $1 million valuated at current U.S. market rates. Investments made in economically depressed locations called Targeted Employment Areas (TEA) or in rural areas can qualify for a lowered mandatory investment threshold of $500,000. EB-5 investments must lead to the creation of 10 full-time U.S. jobs for at least 2 years.

How many EB-5 Visas are issued each year?

The United States Immigration and Citizenship Services reserves 10,000 visas for EB-5 investors each fiscal year. This 10,000 visa quota has never been met. There was a drastic increase in the number of EB-5 program participants in 2011 with more than 3,000 investors applying through the program. Roughly 3,500 EB-5 visas were issued in the 2011 fiscal year which marked an 80% increase from 2010. This growth can be attributed to increased confidence in the program due to USCIS transparency within the program, efficiencies in the application process, and growth in the number of Regional Centers established across the United States.

*April 23, 2012 Quarterly Data on I-526 Receipts released by the USCIS Office of Performance and Quality

EB-5 Regional Centers

EB-5 investor visa applicants have two main investment options. They can either invest as an individual or through an EB-5 Regional Center. Individual investors must find their own investment project and must take a direct managerial role in overseeing that project. Individual investment is best for those who want more hands on control of their investment and the project that received their investment.

EB-5 investor visa applicants can also make their investment to an EB-5 Regional Center. This option is best for those who are more interested in immigration rather than obtaining a maximum return on their investment. Regional Centers receive designation from the USCIS to administer EB-5 investment projects. Regional Centers are responsible for adhering to USCIS EB-5 program regulations. This takes strain off of the investors so that they are not solely responsible for meeting program requirements. As a result, investment through Regional Centers suits those who want a more hands off approach where they are not responsible for the direct management of their investment. Roughly 90 percent of all EB-5 applicants invest through a Regional Center.

EB-5 Investor Visa Application

EB-5 visa applicants must follow three general steps to obtain U.S. permanent residency:

1. Submit I-526 petition to USCIS demonstrating that you have made an EB-5 investment in an:

   • Individual business that will create 10 full-time U.S. jobs per investor OR
   • In a USCIS designated regional center where the investor may create 10 direct, indirect and/ or induced jobs per investor.
2. Upon I-526 approval, the investor submits their conditional permanent resident application either through the filing of an I-485, Application for Adjustment of Status, or DS-230, Application for Immigrant Visa, depending on if the applicant is currently in the U.S. on a valid non-immigrant status. This is the petition that will confer the green card to the investor and his eligible dependents.
3. Lastly, the investors must prove that all EB-5 requirements have been met at the end of the two year conditional residency by filing the I-829 application to remove conditions of residency. The investor, their spouse, and their unmarried children under the age of 21 then become lawful permanent residents and receive their ten year green cards.

EB-5 Program Requirements

Foreign investors must meet specific United States Citizenship and Immigration (USCIS) requirements to obtain their permanent residency through the EB-5 visa program. In general, the investor must meet capital investment amount requirements, job creation requirements, and must ensure that the business receiving the investment qualifies for the EB-5 program. EB-5 visa applicants, their spouse, and their children under 21 will obtain their permanent residency green card once all requirements have been successfully met and approved by the USCIS.

Required EB-5 Investment Amount

EB-5 visa applicants are typically required to make either a $500,000 or $1 million capital investment amount into a U.S. commercial enterprise. The EB-5 investment can take the form of cash, inventory, equipment, secured indebtedness, tangible property, or cash equivalents and is valuated based on U.S. dollar fair-market value.

The minimum amount of capital required for the EB-5 visa program may be decreased from $1 million to $500,000 if the investment is made in a commercial entity that is located in a Targeted Employment Area (TEA). The EB-5 project must either be in a rural area or in an area that has high unemployment in order to qualify for TEA designation.

High unemployment areas are geographic locations that have an unemployment rate that is at least 150 percent of the national unemployment rate at the time of the EB-5 investment. Rural areas are geographic regions that are outside of a city that has a population of 20,000 or more. Rural areas can also be geographic regions that are outside of what the U.S. Office of Management and Budget has designated as metropolitan statistical areas.

EB-5 Job Creation Requirements

The USCIS requires that EB-5 investments result in the creation of 10 full-time jobs for U.S. workers. These jobs must be created within the 2 year period after the investor has received their conditional Permanent Residency. In some cases the investor must be able to prove that their investment led to the creation of direct jobs for employees who work directly within the commercial entity that received the investment. However, the EB-5 investor may only have to show that 10 full-time indirect or induced jobs were created if the investment was made in a Regional Center. Indirect jobs are those created in businesses that supply goods or services to the EB-5 project. Induced jobs are jobs created within the greater community as a result of income being spent by EB-5 project employees.

EB-5 Business Entities

There are several types of business entities that an EB-5 visa applicant can invest in. In general, the applicants can invest directly to a new commercial enterprise or to a Regional Center. New commercial enterprises are lawful for-profit entities that can take one of many different business structures. Such business structures include corporations, limited or general partnerships, sole proprietorships, business trusts, or other privately or publicly owned business structures. All new commercial enterprises must be established after November 29, 1990. However, older commercial enterprises may qualify if the investment leads to a 40-percent increase in the number of employees or net worth, or if an older business is restructured to such a degree that a new commercial enterprise results. In addition to individual business enterprises, EB-5 visa applicants can also invest in EB-5 Regional Centers. Regional Centers administer EB-5 projects. It may be more advantageous for an investor to invest in a Regional Center run project because the investor will not have to independently set up the EB-5 projects.

EB-5 Visa Requirements Summary

• $500,000 (if in TEA) or $1 million capital investment
• Investment must be made to for-profit U.S. commercial entity
• Investment must create 10 full-time U.S. jobs for 2 years