Sunday, April 22, 2012

Standalone EB5 or EB5 Regional Center

EB5 program, in nutshell, is a promise of USCIS to grant green card to foreign investors on the condition that they invest in Us as per certain requirements. 
  • There are two types of EB5 programs
  • Standalone EB5 
  • Regional Centers
Standalone EB5 program is a new commercial enterprise that will create at least 10 full-time direct or indirect 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. A Regional Center is defined as any economic entity, public or private, which is involved with the promotion of economic growth, improved regional productivity, job creation and increased domestic capital investment.
Required minimum investments is in generally $1 million. If the jobs were created in Targeted Employment Area (High Unemployment or Rural Area), the minimum qualifying investment is $500,000.
Regional centers are entities that have convinced USCIS to believe each investor of theirs, supported by statistically correct predicting tool and detailed plan, will result in 10 direct or indirect jobs. 
Either through EB5 Standalone or Regional Center, foreign investor may be granted a conditioned green card for two years.  If 10 jobs can be proven to have been created in two years, the condition on the green card will be removed. The only difference between investing in Standalone EB5 program and in Regional Center is that investor affiliated with a Regional Center can be qualified with 10 indirect jobs. 
The Pro to choose Standalone EB5 is that business stays in control of investors and as long as the project is operated, the risk that the condition won’t be removed is minimum. The con, to some people, is that a foreigner has to manage a new business in an unfamiliar country. The fix to the con is to hire a consulting company to manage the business or to enroll into a franchise company. 
The Pro to choose EB5 center is that investors don’t have to manage the projects themselves. However, trust is a gigantic issue here, let alone, let’s face it, some projects are indeed scams. 
In author’s opinion, franchising business is the best way to take advantage of EB5 center because here trust is not an issue and management can be guided.