Wednesday, August 3, 2011

What is EB5 Program?

EB-5 and EB5 Regional Center are two buzz words. They occur often side by side in people’s conversation. What exactly are EB-5 and EB-5 Regional Center?

EB5 program, also known as the Immigrant Investor Program, was created by Congress in 1990 to stimulate the U.S economy through job creation and capital investment by immigrant investors . Immigrant investors who create a new commercial enterprise or invest in a troubled business, at the same time create 10 jobs will be eligible for permanent residence. There are 10,000 EB-5 immigrant visas available annually. Since 1992, and regularly reauthorized since then, 3,000 EB-5 visas are also set aside for investors in Regional Centers designated by USCIS based on proposals for promoting economic growth.

EB5  program requires that the immigrant make a capital investment of either $500,000 or $1,000,000 (depending on whether the investment is in a Targeted Employment Area [TEA] or not) in a new commercial enterprise located within the United States. TEA is defined by law as “a rural area or an area that has experienced high unemployment of at least 150 percent of the national average.”

The new commercial enterprise must create or preserve 10 full-time jobs for qualifying U.S. workers within two years (or under certain circumstances, within a reasonable time after the two year period) of the immigrant investor’s admission to the United States as a Conditional Permanent Resident (CPR).

There are two distinctive EB5 pathway for immigrant investors. One is direct investment, another one is to invest in a new commercial enterprise affiliated with a USCIS-designated regional center under the Regional Center Pilot Program. n immigrant investing in a new commercial enterprise under the Basic Program may only satisfy the job creation requirements through the creation of direct jobs. Yet an immigrant investor may satisfy the job creation requirements of the program through the creation of either direct or indirect jobs, which means jobs created collaterally or as a result of capital invested in a Indirect jobs are those jobs shown a commercial enterprise affiliated with a regional center by an EB-5 investor.