EB-5 Investors & Regional Centers
What is an EB-5 visa?
The fifth employment-based visa preference category, created by Congress in 1990, is available to immigrants seeking to enter the United States in order to invest in a commercial enterprise that will benefit the U.S. economy and create at least 10 full-time jobs.
The investment can lead to a green card for the investor to permanently live and work in the United States with their spouse and unmarried children under the age of 21 through an investment of at least $1,050,000 or more of lawfully sourced funds. Please note, the government can change the minimum at any time.
There are four methods by which an investor may meet the EB-5 criteria:
- Creating a new business
- Expanding an existing business
- Investing in a troubled business
- Investing in a “Regional Center” project (90% of all EB-5 Investors use this method)
What qualifies as a “new business enterprise” for EB-5?
- Invest or be in the process of investing at least $1,050,000 USD. If your investment is in a designated Targeted Employment Area (“TEA”, discussed further below), then the minimum investment requirement is $800,000 USD.
- Benefit the U.S. economy by providing goods or services to U.S. markets.
- Create full-time employment for at least 10 U.S. workers. This includes U.S. Citizens, Green Card holders (lawful permanent residents), and other individuals lawfully authorized to work in the U.S.
- Be involved in the day-to-day management of the new business or directly manage it through formulating business policy.
What qualifies as a “existing business” for EB-5?
The investment must EITHER:
- Increase the capital of the enterprise by 40%.
- Increase the employment base by 40% (with a minimum of 10 additional workers).
- Be involved in the day-to-day management or in policy-making for the business.
- The same investment requirements of the new commercial enterprise investment apply to a troubled business investment ($1,050,000 or $800,000 USD in a TEA).
What qualifies as a “troubled business” for EB-5?
- Invest in a business that has existed for at least two years.
- Invest in a business that has incurred a net loss, based on generally accepted accounting principles, for the 12 to 24-month period before you filed the Form I-526 Immigrant Petition by an Alien Entrepreneur.
- The loss for the 12 to 24-month period must be at least equal to 20 percent of the business’s net worth before the loss.
- Maintain the number of jobs at no less than the pre-investment level for a period of at least two years.
- Be involved in the day-to-day management of the troubled business or directly manage it through formulating business policy. For example, as a corporate officer or board member.
- The same investment requirements of the new commercial enterprise investment apply to a troubled business investment ($1,800,000USD or $900,000USD in a TEA).
What qualifies as a “Regional Center”?
A regional center is defined by any economic unit, public or private, engaged in the promotion of economic growth, improved regional productivity, job creation and increased domestic capital investment. The program was created in 1992 for the purpose of drawing large-scale investment projects to rural areas or areas of high unemployment.
There are over 700 approved regional centers, but many do not have viable projects that are in compliance with today’s current regulations and expectations. Meyer Law Group is able to assist clients with the parameters surrounding the process of helping EB-5 investors who invest in a Regional Center-promoted New Commercial Enterprise that complies with the requirements of the EB-5 visa category.
What qualified as a “Targeted Employment Area” (TEA)?
TEA Investors only have to invest $800,000 USD. Although TEA investors must create 10 new jobs, the requirements are more relaxed and jobs indirect in nature can count towards the 10. TEA is defined as either:
- An area of high unemployment (150% of the US nationwide average)
- Or, a rural area with less than 20,000 residents not in a “Metropolitan Statistical Area”
Who qualifies for EB-5 and what is a “lawful source of funds”?
There are no requirements for an investor’s background, language, or education. As far as the investor can prove the source of investment of $800,000 USD within a TEA or $1,050,000 USD, they will be a qualified investor. The lawful source of funds must pass through MLG’s renowned rigorous examination and a due diligence exercise performed by our outstanding team of finance and accounting professionals. MLG’s legal professionals have a strong background from the top investment, finance, and accounting firms to qualify them to carefully ensure that all EB-5 capital derives from a lawful source. MLG has a 100% success rate in source of funds analysis.
Meyer Law Group (“MLG”) offers its clients world-class experience and service from application through approval.
Some of the services we offer include the following:
- Consultation and guidance through the completion of the visa application:
- Stage I: Completing and filing application (Form I-526)
- Stage II: Consular processing (CP) or Adjustment of status (AOS) for conditional residence status (CR)
- Stage III: Filing for removal of condition within 2 years of CR (Form I-829) Filing
- Writ of Mandamus
- A Writ of Mandamus is a legal action brought in Federal Court to compel USCIS to act and either approve or deny an immigration application. MLG is now recommending that applicants strongly consider pursuing a Writ of Mandamus if they have filed their Form I-526 on or before December 31, 2018, filed a Form I-829 on or before June 15, 2019, or filed a project exemplar Form I-924 on or before March 15, 2019. We believe that a Writ of Mandamus is an important tool that the EB-5 community can rely on when USCIS unreasonably delays in performing its duties. We recommend you speak with MLG about the potential for using a Writ of Mandamus to accelerate action on your I-526, I-829, or I-924 and look forward to discussing any questions you may have.
- Regional Center Annual Compliance
- Regional Center compliance reviews are another way to enhance EB-5 Immigrant Investor Program integrity and verify information in regional center applications and annual certifications. Under this program, USCIS will collect case-specific data as part of a compliance review.
- A compliance review verifies the information that designated regional centers provide in applications and annual certifications. It also verifies compliance with applicable laws and authorities to ensure continued eligibility for the regional center designation. This process includes, for example, researching information in government systems, reviewing commercial and public records, and reviewing evidence that accompanies regional center applications and certifications. It also includes obtaining information, on a consensual basis, through compliance review data requests and site assessments.
The review team will perform such tasks as:
- Reviewing applications, certifications, and associated records;
- Reviewing public records and information on the regional center;
- Verifying the information, including supporting documentation, submitted with the application(s) and in the annual certification(s);
- Conducting site assessments;
- Assessing the effectiveness of internal controls related to the regional center’s administration, oversight, and management functions;
- Reviewing and analyzing financial documentation;
- Interviewing personnel to confirm the validity of the information provided with the application(s) and annual certification(s).
The review team will document the results in a compliance report, which becomes part of the regional center’s record. Information obtained through the compliance review will be used to assess the regional center’s adherence to applicable laws and authorities. If the report contains any indicators of fraud, USCIS will assess whether further investigation is warranted.
- Investor litigation
- MLG has a wide-range of commercial litigation practice with an unparalleled depth of experience litigating EB-5 investor immigration cases. MLG’s foremost goal is to serve the clients’ interests as efficiently and effectively as possible. To that end, we have achieved results for our clients through negotiated resolutions as well as through Court Orders obtained in the litigation process.
- Regional Center rental or sales brokering
- MLG can connect developers who would like to rent or purchase/sell a regional center.
- MLG can refer to registered broker-dealers who will introduce a suitable EB-5 investment opportunity to EB-5 investors. A broker-dealer will typically work closely with the corporate/securities attorneys for the project to perform initial due diligence and assess the likelihood of success. They will review the project’s marketing, offering and subscription materials, both in English and the investors’ native language(s), and will conduct due diligence to help ensure the accuracy of these materials.
EB-5 Related Forms
Common forms used throughout the EB-5 process are listed below:
I-924A – Supplement to Form I-924
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