The U.S. government created the EB-5 Immigrant Investor Program to encourage foreign investment in U.S. businesses. In exchange for investing in a business that creates jobs for U.S. workers, foreign nationals and their families can become permanent residents of the United States. The program’s name, “EB-5”, comes from the visa category for which immigrant investors apply – the Employment-Based 5th Visa.
While the program has evolved considerably since its creation in 1990, there are currently two ways for foreign investors to obtain an EB-5 Visa:
- Direct investment in a new or existing commercial enterprise that creates jobs, or
- Investing capital through a “Regional Center”, a government-approved firm that actively manages investor funds and the immigration approval process
Investing capital through a Regional Center provides several major benefits to immigrants seeking residency through the traditional EB-5 program. One of the most important advantages of working with a designated Regional Center is the relaxed job creation requirement, which is critical to obtaining and sustaining permanent residency. Normally, an investor must prove he or she created and sustained 10 new, direct jobs over a 24 month period. Under the Regional Center program, however, the investor can satisfy this requirement by showing indirect job creation as the result of pooled funds from all investors in the project. In other words, the investor does not need to show that he or she directly employs any workers.
Regardless of which option an investor chooses, the minimum investment amounts are the same. Each EB-5 Visa applicant must invest a minimum of $1,000,000 in a job-creating venture. If the business receiving capital is located in a Targeted Employment Area (TEA) – a rural area or region with high unemployment – the minimum investment amount drops to $500,000. The majority of offerings are $500,000 investments and EB5 Capital focuses on these types of investments.
To read the actual EB-5 statutes passed by Congress, please visit the following links: