The EB-5 Immigrant Investor Visa Program is designed to allow would-be immigrants the opportunity to apply for U.S. permanent residence by investing in a new commercial venture with an approved ‘regional center’. The aim of this elite program is to provide green cards to foreign investors and their families in exchange for creating jobs in the U.S. economy by investing US $1M (or US $500,000 in certain cases) in an EB-5 regional center project. Each project must lead to the creation of ten full-time jobs as a direct or indirect result of the investment.

In exchange for the investment, the EB-5 Immigration Investor Visa Program grants the issuance of “conditional” or temporary (two-year) green cards to investors and their families. Provided that the investment is maintained and achieves the job requirements of the EB-5 program, “unconditional” or permanent green cards will be issued after a two-year period. These foreign investors subsequently become residents of the United States having actively invested in the economy and promoted job growth.

Benefits to the Investor:

• Live and work anywhere in U.S.
• Expedited permanent green card process
• Travel outside of the U.S. and return without a visa.
• Spouse and children (under the age of 21) become citizens of U.S.
• Sponsor green cards for your relatives.
• Free public school systems for children.
• Resident cost at state universities.

There are two ways to invest within the EB-5 category:

1. creation of a new job-generating commercial enterprise or
2. direct investment in a troubled business

For the immigrant’s convenience (and with the intent of facilitating larger scale job-creation enterprises), Congress approved an alternative job creation program:

• Investment by the immigrant in a Regional Center, a 3rd party-managed investment vehicle whose purpose is the promotion of economic growth, improved regional productivity, job creation, and increased domestic capital investment. A Regional Center takes the responsibility of creating the requisite jobs out of the hands of the individual investor.

A U.S. government approved “regional center” is designated by the United States Citizenship and Immigration Services (“USCIS”) to operate within the EB-5 immigrant investor program. Approved regional centers were certified through a detailed application process by the U.S. government to facilitate the investment process and manage funds invested in new commercial enterprise.

A regional center is defined as any economic unit, public or private, which is involved with the promotion of economic growth, improved regional productivity, job creation, and increased domestic capital investment (“Regional Center”). By investing through this “economic unit”, the immigrant investor enjoys the much more generous job creation/retention calculation methodology afforded only to Regional Centers and not to individual entrepreneurs.

Regional Center job creation includes not only direct jobs, which is the job type that an individual entrepreneur immigrant investor would rely on, but indirect jobs as well, which are a major source for job creation as qualified by the EB-5 visa program.

Direct jobs simply include (i) the employees of the business that the Regional Center acquires (also known as W-2 Jobs) and (ii) the employees of the tenant(s) of the real estate that the Regional Center acquired (also known as non W-2 jobs) (collectively, “Direct Jobs”).

Additionally, the jobs created by the companies that supply the new demand that was created by the investment will also be counted – they are considered indirect jobs. Indirect jobs are those created in response to the new demands of the industries directly affected by the new Direct Jobs (“Indirect Jobs”).

Finally, the Regional Center enjoys a third type of qualifying job – those that are created by induced effects, which typically reflect changes in spending from households as income increases or decreases due to changes in production (“Induced Jobs”).

The Regional Center will perform an economic impact analysis (based on market data) that captures the direct effects of the investment project as well as the secondary indirect and induced effects in order to calculate total full-time job creation and demonstrate that its immigrant investor have satisfied the jobs creation requirements.

By investing in a Regional Center, the immigrant investor puts himself in the best position to achieve the job creation requirements and obtain a visa by opening himself or herself up to the most qualifying jobs.

The purpose of the EB-5 visa program is to retain and create jobs within the U.S. economy. INA §203(b)(5)(ii) requires that a qualifying investment:

1. in a new commercial enterprise creates full-time employment for not fewer than 10 persons qualified to work in the United States, or
2. in a troubled business maintains the number of existing employees (qualified to work in the United States) 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
• has incurred a net loss for accounting purposes (determined on the basis of generally accepted accounting principles) during the twelve or twenty-four month period prior to the priority date on the alien entrepreneur’s Form I-526 and the loss for such period is at least equal to 20% of the trouble business’ net worth prior to such loss