EB-5 Program overview
The EB-5 visa for Immigrant Investors is a United States visa created by the Immigration Act of 1990. This visa provides a method of obtaining a green card for foreign nationals who invest money in the United States. To obtain the visa, individuals must invest at least $1 million, creating at least 10 jobs.
The required investment is reduced to $500,000 for a business established in a Targeted Employment Area (TEA). TEAs include:
- Rural areas, defined as any area other than one within a metropolitan statistical area or within the boundary of a city or town with a population of 20,000 or more; and
- Areas having an unemployment rate that is at least 150% of the national average.
The EB-5 Visa program offers a few advantages over other types of immigrant visas. First, it currently has no quota backlogs. 10,000 visas are set aside each year for investors in the EB-5 program, and this quota has never been fully utilized. Qualified investors generally can receive temporary green cards within a few months. Second, investors do not require sponsorship from either an employer or a family member in the United States. In addition, investors' family members, spouses/partners and all children under age 21, will also receive their own green cards. Once approved for permanent residency, foreign investors have the freedom to live, work and retire anywhere in the United States, and are entitled to most benefits enjoyed by US citizens.
To encourage EB-5 investment, the United States Congress created a pilot program in 1993 allowing U.S. Citizenship and Immigration Services (USCIS) to designate regional centers. A regional center is a private enterprise or corporation or a regional governmental agency with a targeted EB-5 investment program within a defined geographic region. The main functions of a regional center include:
- Identify qualifying investment projects
- Market those investment projects to attract investors
- Help investors prepare immigration documents
- Assist investors in handling investment paperwork
- Manage investors' visa application process
- Oversee funded projects to ensure their proper execution
Region centers generally pool EB-5 funds together to invest in large projects that require millions of dollars. This type of investment is usually either loan-based or equity-based. Compared to an individual/direct EB-5 application, where an investor establishes a new business and then applies for an EB-5 visa, the regional center program has several significant advantages:
- Investment has been pre-approved by USCIS with respect to the qualifying amount of the investment and with respect to the job creation requirement;
- The job creation requirement counts direct, indirect and induced jobs; and
- Investors do not need to manage day-to-day business.
There are some cases where the EB-5 investor may prefer a direct or individual EB-5 program, such as when the primary investment objective is to create a successful business in the United States. However, over 90% EB-5 investors use regional centers.