EB 5 Investment

Conditional permanent residence

In order to gain legal permanent residence in the US EB-5 applicants must first apply for conditional permanent residence, which lasts for 2 years. During this time the investor must meet the conditions outlined below in order to be granted full legal permanent residence.

New commercial enterprise

EB5 applicants’ investment must be directed towards ‘new commercial enterprises’, as defined by USCIS. This does not mean investors must set up a business from scratch, but the business receiving investment must meet certain conditions. These are:

• Having begun trading either on or after November 29^th, 1990, OR 
• Having been taken over and undergone extensive restructuring, OR 
• Having gained either 40% net worth, or 40% more employees as a result of the EB-5 investment

Job creation

In order to gain lawful permanent residence through the EB5 visa category investors must have created a minimum of 10 full-time US jobs within two years of entering the US.

Minimum investment: Targeted Employment Areas

For most EB-5 investors a minimum of $1,800,000 of investment is required. However, If the location of the investment is deemed to be a Targeted Employment Area (TEA) that amount drops to $900,000. Targeted Employment Areas fall into 2 categories:

• Rural TEAs; To be designated a rural TEA an area must be outside of the U.S. Office of Management and Budget’s designated metropolitan statistical areas (MSA). The exact definition of such areas is often unclear, but essentially the TEA they must not be near towns or cities with more than 50,000 residents. A full US map of MSAs can be found here the second condition of an area being designated a rural TEA is that it must not be within the boundaries of any town with 20,000 residents or more. 
• High unemployment TEAs; High unemployment TEAs are areas with 20,000 or more residents with an unemployment rate of at least 1.5 times the US average.

Visa Classification Description

USCIS administers the EB-5 program, created by Congress in 1990 to stimulate the U.S. economy through job creation and capital investment by foreign investors. Under a program initially enacted as a pilot in 1992, and regularly reauthorized since then, investors may also qualify for EB-5 classification by investing through regional centers designated by USCIS based on proposals for promoting economic growth. On Feb. 15, 2019, President Trump signed a law extending the Regional Center Program through Sept. 30, 2019.

All EB-5 investors must invest in a new commercial enterprise that was established:

• After Nov. 29, 1990, or
• On or before Nov. 29, 1990, that was:
  1. Purchased and the existing business is restructured or reorganized in such a way that a new commercial enterprise result; or
  2. Expanded through the investment, resulting in at least a 40% increase in the net worth or number of employees.

Job Creation Requirements

An EB-5 investor must invest the required amount of capital in a new commercial enterprise that will create full-time positions for at least 10 qualifying ​employees. ​  

• For a new commercial enterprise not located within a regional center, ​ ​the new commercial enterprise must directly create the full-time positions ​to be counted.​ ​This means that the new commercial enterprise (or its wholly owned​subsidiaries) must itself be the employer of the qualifying employees​.​​
• For a new commercial enterprise located within a regional center, the new commercial enterprise can directly or indirectly create the full-time positions. ​​
  • Direct jobs are those jobs that establish an employer-employee relationship between the new commercial enterprise and the persons it employs.
  • Indirect jobs are those jobs held outside of the new commercial enterprise but that are created as a result of the new commercial enterprise.
• In the case of a troubled business, the EB-5 investor may rely on job maintenance.
  • The investor must show that the number of existing employees is being, ​ or will be​,​ maintained at no less than the pre-investment level for a period of at least ​two​ ​years.​ 

A troubled business is one that has been in existence for at least two years and has incurred a net loss during the 12- or 24-month period before the priority date on the immigrant investor’s Form I-526. The loss for this period must be at least 20% of the troubled business’ net worth before the loss. When determining whether the troubled business has been in existence for two years, USCIS will consider successors in interest to the troubled business when evaluating whether they have been in existence for the same period of time as the business they succeeded.

A qualifying employee is a U.S. citizen, lawful permanent resident, or other immigrant authorized to work in the United States including, but not limited to, a conditional resident, temporary resident, asylee, refugee, or a person residing in the United States under suspension of deportation. This definition does not include immigrant investors; their spouses, sons, or daughters; or any alien in any nonimmigrant status (such as an H-1B nonimmigrant) or who is not authorized to work in the United States.

Full-time employment means employment of a qualifying employee by the new commercial enterprise in a position that requires a minimum of 35 working hours per week. In the case of the regional center program, “full-time employment” also means employment of a qualifying employee in a position that has been created indirectly that requires a minimum of 35 working hours per week.

A job-sharing arrangement where two or more qualifying employees share a full-time position will count as full-time employment provided the hourly requirement per week is met. This definition does not include combinations of part-time positions even if, when combined, the positions meet the hourly requirement per week.

Jobs that are intermittent, temporary, seasonal, or transient in nature do not qualify as permanent full-time jobs. However, jobs that are expected to last at least two years are generally not considered intermittent, temporary, seasonal, or transient in nature.

 Capital Investment Requirements

Capital means cash, equipment, inventory, other tangible property, cash equivalents, and indebtedness secured by assets owned by immigrant investors, if they are personally and primarily liable and the assets of the new commercial enterprise upon which the petition is based are not used to secure any of the indebtedness. All capital shall be valued at fair-market value in U.S. dollars. Assets acquired, directly or indirectly, by unlawful means (such as criminal activities) will not be considered capital for the purposes of section 203(b)(5) of the Act.

Note: Immigrant investors must establish that they are the legal owner of the capital invested. Capital can include their promise to pay (a promissory note) under certain circumstances.

The minimum investment amounts by filing date and investment location are:

Future adjustments will be tied to inflation (per the Consumer Price Index for All Urban Consumers, or CPI-U) and occur every five years.

A TEA can be, at the time of investment, either:

• A rural area; or
• An area that has experienced high unemployment (defined as at least 150% of the national average unemployment rate).

A rural area is any area other than an area within a metropolitan statistical area (MSA) (as designated by the Office of Management and Budget) or within the outer boundary of any city or town having a population of 20,000 or more according to the most recent decennial census of the United States.

A high-unemployment area may be any of the following areas, if that area is where the new commercial enterprise is principally doing business and the area has experienced an average unemployment rate of at least 150% of the national average unemployment rate:

• An MSA;
• A specific county in an MSA;
• A county in which a city or town with a population of 20,000 or more is located; or
• A city or town with a population of 20,000 or more outside of an MSA.

A high-unemployment area may also consist of the census tract or contiguous census tracts in which the new commercial enterprise is principally doing business, which may include any or all directly adjacent census tracts, if the weighted average unemployment for the specified area based on the labor force employment measure for each tract is 150% of the national unemployment average.