Mon. Nov 4th, 2024

WWICS Group Announces: Understanding the EB-5 Visa Program

The WWICS Group is pleased to provide comprehensive information about the Employer-based fifth preference (EB-5) visa for the United States, under the EB-5 Immigrant Investor Visa Program. Established in 1990 by the Immigration Act, this program offers eligible immigrant investors the opportunity to become lawful permanent residents, commonly known as “green card” holders, by contributing a significant sum of money to finance a U.S. company (referred to as a “new commercial enterprise”). A crucial requirement is that the investment must create ten or more full-time jobs for American citizens and immigrants with work permits. The primary objective of the EB-5 program is to foster “foreign investments and economic growth.”

The United States has five employment-based (EB) preference programs, one of which is the EB-5 Immigrant Investor Visa Program. Under the EB-5 Reform and Integrity Act, which became law on March 15, 2022, the minimum investment required to be eligible for the EB-5 program is $1,050,000. However, if the investment is made in a targeted employment area (TEA) or an eligible infrastructure project, the investment threshold is reduced to $800,000. To invest less capital, most immigrant investors participating in the EB-5 program invest in TEAs—rural areas or areas with high unemployment rates. The $800,000 investment minimum for TEA or infrastructure projects qualifies investors for EB-5 “set aside” visas, which are divided into three categories: projects in rural areas, high-unemployment areas, and infrastructure projects.

The EB-5 Program is managed by USCIS. Investors, along with their spouses and unmarried children under 21 years of age, may apply for lawful permanent residence (a.k.a. a Green Card) under this scheme if they invest the required sum in a U.S.-based business and intend to establish or maintain 10 full-time, permanent positions for eligible U.S. workers.

Investment Options:

Investors have two primary options when making an EB-5 investment: direct investment into a start-up business or investment through a Regional Center.

Direct Investment: This requires a capital investment of $1,050,000, or $800,000 if the business is located in a Targeted Employment Area (TEA), and grants the investor total control over the business. Direct Investments typically involve launching a new company or acquiring an existing one and being actively involved in its management. The emphasis is on creating direct jobs, which involve forming an employer-employee relationship between the newly established enterprise and its employees. Direct Investments are considered riskier than Regional Center investments because their success largely depends on the investor’s management skills. This method is suitable for investors seeking greater autonomy over their business.

Regional Center Investment: Regional Centers are specifically designated organizations authorized by the U.S. Citizenship and Immigration Services (USCIS) to stimulate economic development in their designated areas. They play a crucial role in supporting major investment projects funded by EB-5 investors. These investments primarily aim to generate indirect employment opportunities in the community rather than directly at the invested enterprise. By pooling their resources to finance larger projects, usually in TEAs, investors can more easily meet job creation requirements when they invest through a Regional Center, which is officially authorized by USCIS. Regional Centers offer a slightly less active investment choice by managing the day-to-day activities of the investment project.

To ensure that investors are genuinely committing funds and not merely “buying” a visa, all EB-5 investments must be “At Risk.” Investors must perform extensive due diligence to assess the risks associated with their chosen investment. This involves evaluating the project’s potential for job creation, financial sustainability, and the credibility of the Regional Center or direct investment opportunity.

For more information on how to navigate the EB-5 Visa Program and explore investment opportunities, please contact the WWICS Group. ( Courtsey : Parvinder Singh Sandhu Sr. Director WWICS Group)

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