A Step-by-Step Guide for Business Leaders

EB-5 investment benefits the U.S. economy, areas in need of investment, business leaders and EB-5 investors alike. The main aim of the EB-5 program is to create jobs for U.S. workers through foreign investment. In exchange, EB-5 investors qualify for U.S. permanent residency and U.S. citizenship if they so desire. For business leaders, EB-5 investments are a source of funding at below-market rates.

Following the sunset of the regional center program on June 30, 2021, only direct EB-5 investment is available. This simply means that each EB-5 investor must make a direct investment in a project or entity that will create 10 jobs because of that investment. To access this source of capital for your next project, follow these five steps.

Related: Is Regional Center EB-5 Funding the Right Investment for You?

1. Engage the right EB-5 professionals


Although the requirements of the EB-5 program seem quite simple, they are more complex than many people realize. You can try to secure EB-5 capital yourself, but relying on professional EB-5 partners vastly simplifies and speeds up the process. You may need to consult several legal professionals to ensure that you know all you need to about the immigration, tax and securities implications of using EB-5 capital. Other helpful EB-5 professionals include accountants, consultants and business plan writers. 

2. Assess the project’s suitability for direct EB-5 investment

The needs and characteristics of your project determine whether it is suitable for direct EB-5 investment. Each EB-5 investor’s investment must create 10 new, full-time, salaried jobs for American workers for at least two years. Consequently, your project must be able to create 10 jobs per investor. Smaller projects or businesses are usually better suited to direct EB-5 investment because they require less capital and can accommodate a limited number of investors. Thus, it is also important to determine the percentage of project capital you need to source from EB-5 investment.

To ensure that investors’ I-526 petitions are approved, your business plan must include a concrete, plausible plan that shows how the required jobs will be created. The business plan must conform to the requirements set out in the Matter of Ho, so work with a business plan writer with EB-5 experience.

To qualify for permanent U.S. residency, an EB-5 investor’s investment must also remain invested and at risk until the investor has held conditional permanent residency for at least two years. In this context, “at risk” means that the investor can benefit from gains or experience losses — neither condition is guaranteed. If the investor fails to meet this requirement, he or she no longer qualifies for residency based on the EB-5 program, so the project must allow investors to meet this requirement.

https://www.stamfordadvocate.com/business/article/How-to-Secure-Direct-EB-5-Investment-A-16826271.php

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