EB-5 101

Launched in 1990, the EB-5 immigrant investor program was designed to stimulate the U.S. economy by attracting foreign investors able to create jobs. Often incorrectly labeled an immigration program, Chicagoland Foreign Investment Group recognizes the importance of properly explaining EB-5’s origin, mission, and terminology in order to elucidate the many economic benefits.

 At Chicagoland Foreign Investment Group, we recognize that the EB-5 visa category has been instrumental for both foreign nationals interested in investing in the U.S. and for job creation. The name of the program comes from the fact that this visa is the 5th category of employment based (EB) visas. Ten thousand visas are set aside annually for investors and their immediate family members under the program. Each investment must create at least 10 new jobs.

What Are the Basic Criteria Required for an EB-5 Visa? In order to qualify for an EB-5 Visa, an investor must invest at least $1,000,000, or $500,000 for a project in a “targeted employment area” (as discussed below), in an enterprise that will create at least 10 new full-time jobs for U.S. citizens and legal residents. If the project is an existing business, the 10 new jobs have to be in addition to the existing jobs in the business. Chicagoland Foreign Investment Group can help further demystify the visa application process.

What is a Targeted Employment Area? A targeted employment area is any city, county, census tract or other geographical area accepted by the USCIS that has an unemployment rate over 150% of the national average rate, or a “rural area.” A rural area is an area outside a metropolitan statistical area or outer boundary of any city or town having a population of 20,000 or more.

What is an EB-5 Regional Center? A Regional Center is an entity created by either a public or private group to sponsor projects for EB-5 investors. There are currently about 150 approved Regional Centers, but many more applications are pending with the USCIS and are expected to be approved if their business plans are considered feasible and meet the job creation criteria. According to the trade association IIUSA, Regional Centers have invested over $2.0 billion of foreign capital, creating over 50,000 jobs in the U.S. Chicagoland Foreign Investment Group has the only regional center that allows investors to invest on themselves and play a vital role in their own projects

Who are the EB-5 Investors? EB-5 investors can come from any country outside the U.S., and can even include people who are in the U.S. legally under a temporary visa. In the first three quarters of fiscal 2011, over 70% of all EB-5 investors have come from mainland China and Dubai, where Chicagoland Foreign Investment Group has very strong contacts.

What issue has caused the most problem when applying for an EB-5 visa? The most common problem area has been insufficient documentation of the source of funds. Many people try to disclose the least possible information only to have the file returned with a request for further information.

With the continued economic instability in the United States, the EB-5 program offers a tremendous opportunity to build infrastructure and promote job growth. Chicagoland Foreign Investment group remains committed to both educating and promoting this powerful stimulus program.