Investing in the United States. EB-5s and E-2s
There is a growing number of individuals who have earned, acquired, or inherited substantial wealth and now want to use that wealth towards investing in the United States. One of the best pathways to U.S. Permanent Residence or a renewable long-term visa is via investment. You can earn a visa or green card by investing in a new or existing U.S. company. We realize that most will be unable to afford the steep price tag for an EB-5 green card, but for those who do, it is a wonderful opportunity to create a new life for you and your family in the United States. For those who can’t or don’t want to risk as much, an E-2 investment visa is also a great plan for business in the U.S.
First of all, what is an EB-5? The EB-5 is known as the “Immigrant Investor Program”. You have to a) make a necessary investment in a commercial enterprise in the U.S. and b) plan to create or preserve 10 permanent full-time jobs for qualified U.S. workers. EB-5’s can either be a direct investment or a regional center investment. With a Direct Investment you either create a new company/project or buy an existing company/project and directly manage and control the enterprise. There is also an EB-5 Regional Center Program which allows you to invest in commercial enterprises via approved USCIS “Regional Centers” designed for economic growth.
Advantages of EB-5s:
- You can obtain a green card for you, your spouse, and minor dependent children with a sizable investment.
- You can be from any country.
- Even if you are born in India, the visa bulletin backlog is much shorter in the 1st employment preference category (EB-1A, EB-1B, EB-1C, EB-5).
- You don’t have to demonstrate extraordinary ability or have an existing job or job offer or sponsor. All you need is money and a plan.
Disadvantages of EB-5s:
- They are expensive. They are cost prohibitive for most investors.
- There is still market risk as in any investment.
- There is also a lot of EB-5 fraud out there. Make sure you hire a qualified immigration attorney along with an investment/finance/accounting team to analyze your potential investment. *** Plenty of companies purposely prey on people desperate for green cards.
- Due diligence and research are most important in an EB-5. Don’t rush into anything.
The EB-5 Direct Investment requires a more sizable initial investment. However, you have many more options to choose from including starting your own business or buying an existing business. You also have to be willing to run your company or at least play a more active role on the management side. Since you have more flexibility in the type of business to start or purchase, you potentially can earn a lot more money in return. If you invest in a hotel for 2.5 million dollars it could turn into both a green card and a very profitable enterprise.
On the other hand, the EB-5 Regional Center Program allows you to invest less money, sometimes even under a million dollars (U.S.), but you have much less control over the company. EB-5 Regional Centers are projects designed to have numerous investors who passively invest in a project. Essentially, you buy into an existing project but you don’t have much direct control. These investments are more limited in options because they must be USCIS approved “Regional Centers”. Also, there is a greater chance for fraud or for your investment to lose money or outright fail. For this reason, be careful which project you choose.
Don’t invest your entire life savings into a project simply to get a U.S. Green Card. You should invest in an EB-5 because the project is vetted and seems like a good investment even without the green card. However, be prepared to take some sort of loss. I am not an expert in accounting, finance, or real estate like my law partner Hao “Howard” Li. I don’t offer any tax, investment, or financial advice on any project. Very few immigration attorneys have any type of financial background which would qualify them to give business advice on an EB-5 or even an E-2 project. It is best to come to us once you have selected a suitable project.
What if you don’t have enough money for an EB-5 but still want to invest in a U.S. company or start a business in the United States? The E-2 investment visa is a great option for that. You just need to make sure you are from an eligible E-2 “treaty country”. India unfortunately is not E-2 eligible. Neither is China. However, Bangladesh, Pakistan, and Sri Lanka are in addition to countries such as Canada or the UK. Did you know if you obtain citizenship from an E-2 country, you may then potentially be eligible for an E-2. For example, if you were born in India but became a Canadian Citizen, you could then consider an E-2 visa.
An E-2 visa allows you to start or buy a business in the U.S. and live here with your family while running your business. An E-2 is still a non-immigrant visa, meaning it does not lead to a green card but it can be renewed for years as long as your company is solvent. Examples of E-2 investments could be buying a restaurant, a convenience store, or even a small software company. You will still need to invest a substantial amount of money and have a solid business plan to present in your petition. While there is no set minimum amount for an E-2, the more you put at risk the better your chances of approval. Also, the better your plan is and the more business experience you have the better your chances are.
E-2 visas can also be tricky because of the different U.S. consulates you have to deal with. Some are stricter, some have much longer processing delays, and each may have their own set of rules you must comply with in order to obtain your visa. Some consulates may not even give out E-2 visas so you may have to apply at a third country consulate. Overall, an E-2 visa is less risky than an EB-5 due to the much lower amount required to invest along with the greater flexibility in possible projects or business choices. E-2s also can be obtained in a much shorter time period. An EB-5 or E-2 can be a great solution under the right circumstances.
This article does not constitute a solicitation or provision of legal advice and does not establish an attorney-client relationship. The answers provided should not be used as a substitute for obtaining legal advice from an attorney licensed or authorized to practice in your jurisdiction. You should always consult a suitably qualified attorney regarding any specific legal problem or matter on time.
U.S. Immigration Attorney Seth Finberg is a 2005 graduate of the University of Georgia School of Law. Seth is a member of the Georgia Bar and the American Immigration Lawyers Association (AILA). Mr. Finberg is the owner and founder of South Florida based Finberg Firm PLLC and he represents clients nationwide and internationally in business, employment, and investment immigration. He can be reached by phone at (305)-707-8787 or by email at info@finbergfirm.com or visiting www.finbergfirm.com.
