Many countries around the world have immigrant investor programs. The most successful today of these programs are located in Australia, the United Kingdom, and the United States. Canada was the most successful at bringing in investment dollars; however recently parts of its program have been closed. The United States immigrant investor program is called the EB5 program which is short for: Employment Based 5th Preference. Success for immigrant investors in this program results in a permanent United States visa (Permanent or green card for themselves and qualified family members under the age of 21 at the time of filing the initial petition). Success for the United States is the program requires immigrant investors to make an at-risk investment (One million dollars or $500,000 depending on several factors) that creates no fewer than 10 new American jobs, thus the name Employment Based 5th Preference Visa.
If a foreign national invests $1 million (or in some cases $500,000 within a targeted employment area, an area statistically proven to be 150% of the U.S. national unemployment rate or rural area) in a business that creates ten new American jobs, the immigrant investor would be eligible to obtain a green card (permanent visa) for themselves and their qualifying family members. The program has many other provisions, such as maintaining the investment throughout the EB5 conditional permanent residency period, increasing regional productivity, and other requirements. The program is divided into two distinct phases. In the first phase the immigrant investor is granted a conditional visa. After two years, the conditions on the visa are removed if the investor has proven the creation ten new American jobs, maintained the required amount of investment and met the residency time requirement the conditions on the visa are removed and the visa is made permanent.
What is the history of the EB5 visa category?
The EB5 visa category started in 1991. Regional Centers started in 1993. CMB Export LLC’s application to become Regional Center was duly approved by the Immigration and Naturalization Service in 1997 (we believe the 2nd Regional Center to be approved). During the mid 1990’s several companies competed for investment capital from foreign investors within the EB5 program. Most of the companies did not offer sound investments, and investment opportunities, did not place the full $500,000 investment capital in the new commercial enterprise or create the required number of new American jobs. The legacy INS wanted to stop these abuses and other abuses of the program, this involved law suits and the EB5 program was effectively placed on hold between 1999 and 2002/2003. In 2002, Congress passed new changes to the existing EB5 law more particularly to the “Pilot Program” which contained the creation of regional centers to protect the integrity of the program. Also, in 2002, in a case commonly known as “Chang” in the 9th Circuit Court of Appeals ruled that USCIS or INS may not apply their new rules retroactively or readjudicate the I-526 at the I-829 phase. In August of 2003, USCIS began approving Regional Center petitions for the first time since 1998.
In January 2005, to improve and expedite EB5 Regional Center related applications USCIS established an Investor and Regional Center Unit, IRCU, the unit being the sole adjudicative jurisdiction for Regional Center applications pursuant to the Immigrant Investor Pilot Program for purposes of approval, denial and Requests for Evidence (RFE’s). In light of the “Chang” case and the new Congressional enactments in this area, CMB sought and received an updated Regional Center authorization letter in 2007. It is now common knowledge that EB5 immigration petitions based on sound investments in designated Regional Centers with a proven TEA designation backed by accurate statistical data including reasonable proof ten new jobs will be created for each foreign national investor and the full $500,000 has been placed in a new commercial enterprise in an at-risk investment as prescribed by the rules, with proper supporting documentation, should be approved.
What is an EB5 Designated Regional Center?
A “Regional Center:”
Types of EB5 Investments
EB5 Investments are broken into two categories: a direct investment by a foreign national into a particular business or an investment into a Regional Center. The direct investment is just that – an investment into a specific company. In the direct EB5 investment, the investor is only allowed to utilize direct jobs to qualify for residency (A permanent green card for themselves and all qualified family members under 21 years old). The direct jobs are those new American jobs created within that particular company (the new commercial enterprise) the investor placed their investment.
A Regional Center is a designation granted by the USCIS to an entity that has satisfied requirements under the regional center regulations of the USCIS. This application process is rigorous and complex and the application among many other things outlines the Regional Center’s entire business plan and the job creation methodology that will be utilized to show ten new jobs will be created for each of the foreign national investors in the new commercial enterprise. Once approved, by the USCIS, the Regional Center has much greater power in that the Regional Center can demonstrate creating jobs through pooling investor funds as well as utilizing indirect as well as direct jobs. This is a very powerful tool that allows for greater leeway in demonstrating job creation proof. Regional Centers are allowed to utilize both direct and indirect job creation to support the investor’s requirement for a minimum of ten new American jobs created. Simply stated, a Regional Center has greater flexibility in demonstrating job creation within the new commercial enterprise than a direct investment for an EB5 applicant to prove their requisite job creation. We believe investing through the CMB Regional Center offers the immigrant investor the most expeditious means for obtaining a permanent visa. Our methodology for demonstrating job creation begins at the I-526 and has been 100% successful to date on every final CMB I-829 adjudication.