Investor/Employment Creation (EB-5)

The fifth preference employment-based immigrant category (EB-5) allocates 7.1 percent of available visas to foreign nationals who commit to investing in qualified Regional Centers, establishing new commercial enterprises, or reviving troubled commercial enterprises. The program has existed since 1990 and has been repeatedly re-authorized. The program was most recently extended in late-September 2016, through December 9, 2016. A further extension is likely.


To qualify for the EB-5 program, an investor must show he or she:

  • Has invested or is actively in the process of investing
    • In a new commercial enterprise or is actively in the process of investing in a qualifying enterprise;
    • $1 million of capital, or $500,000 if the enterprise is in “targeted employment areas” (“TEAs” a rural area or area deemed to be suffering from high unemployment);
  • Is making an investment that will benefit the U.S. economy and create at least 10 full-time jobs for individuals other than the investor and their immediate family; and
  • Is or will be engaged in the management of the related U.S. enterprise.

If these conditions are met, the EB-5 program grants a qualifying investor, his or her qualifying spouse, and his or her unmarried children conditionalpermanent residence for two years. Within ninety days of the two year anniversary of obtaining conditional permanent residency, the qualified investor can petition to remove the conditions on their green card and will be given unconditional permanent residency if they show:

  • The investment has been sustained;
  • The requisite jobs have been created; and
  • The investment continues to meet other requirements.

The EB-5 petition is filed by the investor directly and needs no third party sponsor. The investor must, however, provide substantial evidence demonstrating the nature, scope and purpose of the investment.

Types of EB-5 Projects

All EB-5 investments must be in a commercial enterprise that is actively involved in a for-profit activity. There are three main types of EB-5 projects.

Regional Centers

Regional Centers are business organizations which USCIS has authorized to accept investments from EB-5 investors on the basis of their proposals to promote economic growth. Regional Centers must apply for and receive USCIS approval prior to accepting investments and annually must demonstrate their continued eligibility for Regional Center designation. (A list of approved Regional Centers is available on the USCIS website, as too is a list of Regional Centers whose approvals have been terminated for failure to maintain compliance.)

Regional Centers and those promoting them must also abide by federal securities law related to the offering of financial instruments, including applicable registration and disclosure rules. The U.S. Securities and Exchange Commission (SEC) has imposed fines on immigration attorneys representing EB-5 beneficiaries investing in Regional Centers where the SEC determined that the investment promotion had taken place in connection with the representation.

From an immigration benefits perspective, investing in a Regional Center has two substantial advantages for investors over investing in an otherwise qualified enterprise: 1) as most Regional Centers are intentionally located in TEAs, the threshold investment level usually qualifies at the $500,000 level, rather than $1 million; and 2) it is considerably easier to demonstrate the creation of 10 U.S. jobs, as the beneficiary may take into account indirect employment creation (e.g., by contractors of the investment entity).

These benefits have resulted to great popularity for the EB-5 Regional Center investment route. In recent years, over 90 percent of EB-5 visas were issued to individuals investing in Regional Centers. As with any investment, however, those interested in EB-5 Regional Center involvement should perform their due diligence on the merits and quality of the enterprise.

Stand-Alone Enterprises

The investment may also be made in stand-alone business enterprise owned in whole or in part by the principal beneficiary. There is no minimal investment percentage required, but each investor relying on the enterprise for EB-5 eligibility must meet all EB-5 requirements, including the requirements for capital investment, job creation, and participation in management.

The investment can be made in a completely original enterprise, or a previously existing enterprise that has been reorganized (through changes to its structure, organization, or operations) such that a new enterprise has been created. Expanding an existing business would also qualify, provided that the investment increases by 40{877c034753eacee7259c3c97ae2e02ad1f8f94c95ed6455a0455c04073043e02} either the net worth of the enterprise or its number of employees as a result of the investment.

Troubled Businesses

A qualified investment may also be made a “troubled business” (i.e., one that has been in existence for at least two years and has lost 20{877c034753eacee7259c3c97ae2e02ad1f8f94c95ed6455a0455c04073043e02} or more of its net worth in the 12 or 24 months preceding the investment) provided that, after the investment, the business maintains employment at pre-investment levels for at least two years.


The EB-5 program is open to nationals of all foreign countries, unlike the E-1/E-2 non-immigration category.

Each year, 10,000 immigrant visas are allocated to this category. These 10,000 visas are allocated as follows: 1) 3,000 are reserved for investors in a targeted rural or high-unemployment area; 2) 3,000 are set aside for investors in Regional Centers; and 3) the remaining 4,000 are generally available to be used by other qualified investors (this pool can also be used by investors in targeted areas or Regional Centers if demand in those categories exceed the set-asides).

EB-5 visas are consistently available for all countries except China. This is due to per-country limitations and high EB-5 demand from China. In recent years, over 80{877c034753eacee7259c3c97ae2e02ad1f8f94c95ed6455a0455c04073043e02} of EB-5 investors have been from China. For those reasons, since May 2015 there have been cut-off dates for Chinese EB-5 visa availability. As of November 2016, the cut-off date for the China EB-5 category is March 8, 2014.

Investment Requirements

Amount and Source of Capital

The petitioner must establish that he has placed the minimum level of capital at risk in the business ($1 million, or $500,000 if the investment is located in a TEA). This requires more than a mere intent to invest, or the existence of a highly conditioned commitment (although the investment may be conditioned on grant of the visa itself). Evidence of investment may include:

  • Bank statements showing the requisite amounts deposited in the business account of the enterprise (but not in the account of the petitioner if the deposit may be easily withdrawn and used for other purposes);
  • Invoices, purchase contracts, receipts or other evidence of assets purchased for use in the U.S. business;
  • Documents demonstrating the transfer of assets from offshore into the United States for use in connection with the business;
  • Shareholder or stock purchase agreements demonstrating a commitment to invest in the U.S. enterprise and which bar the redemption of invested funds on demand; and
  • Evidence of loans secured by the property of the petitioner or which otherwise provide recourse to the petitioner's assets so as to guarantee the obligations of the business.

The investment is not sufficiently at risk if the individual has a contractual right to the return of his investment at a future date.

The burden is also on the investor to demonstrate that he has secured investment capital from a lawful source. Evidence might include foreign business records, tax returns, or copies of legal judgments resulting in an award.

Job Creation

In general, every EB-5 investment must result in the creation of no fewer than 10 full-time positions, although there are some variations to this requirement.

If the investment is in a Regional Center, the required 10 jobs can be either direct jobs for qualified employees which are actually identifiable in the commercial enterprise(s) affiliated with the Regional Center, or indirect jobs that it is demonstrated have been created at non-affiliated businesses as a result of the capital invested in the Regional Center. Indirect job creation is often demonstrated using economic analyses.

If the investment is in a new enterprise, the ten jobs must be in the enterprise itself. Indirect jobs and retained jobs are not counted toward this requirement.

If the investment is to be made in a "troubled business" the petitioner must demonstrate that at least 10 existing qualifying jobs will be maintained for at least two years.

Company Management

The fifth preference requires the investor's active participation in the management of the enterprise, either through day-to-day managerial control or through policy formulation. This could be shown by evidence of, for example, a senior management position, membership in the company's board of directors, or managing/general partner status. This is required regardless of whether the investment is in a traditional business, or in a Regional Center.

However, for Regional Centers, the actual amount of participation can be very low as the immigration regulations allow Regional Centers to be set up as limited partnerships with each EB-5 investor serving as a limited partner. The EB-5 investor will be considered “sufficiently engaged in the management of the new commercial enterprise” so long as enterprise’s limited partnership agreement grants them “certain rights, powers, and duties normally granted to limited partners under the Uniform Limited Partnership Act.”

Removal of Conditional Status

The burden is on the investor to petition for removal of conditional status within the 90 days immediately preceding the two-year anniversary of the grant of fifth preference immigrant status, and failure to do so can result in removal proceedings. The petition must include evidence that:

  • The business was created, documented by, e.g., copies of tax returns;
  • The individual invested or was actively in the process of investing the appropriate level of capital and maintained the investment through the two year period;
  • The individual substantially met the investment requirement and continued the maintain the investment over the two years; and
  • The business has either created or can be expected to create, within a reasonable time, the requisite ten full-time jobs (directly or, in the case of Regional Center investments, indirectly), or, in a "troubled business" has maintained company employment at pre-investment levels.

Future Developments in EB-5

The EB-5 program requires regular Congressional reauthorization, as it is not permanently written into the immigration law. The program has come under a great deal of political pressure however, so there is a degree of uncertainty about the future of the EB-5 category. Recent proposals in Congress have called for increasing the minimum investment requirements to $800,000 for investments in TEAs (a 60{877c034753eacee7259c3c97ae2e02ad1f8f94c95ed6455a0455c04073043e02} increase), to $1.2 million for other investments (a 20{877c034753eacee7259c3c97ae2e02ad1f8f94c95ed6455a0455c04073043e02} increase), and to thereafter index the minimum investment requirements to inflation. There have also been proposals to initiate integrity-related measures such as requirements for all investors and Regional Centers to disclose fee arrangements and for Regional Centers to receive approval from USCIS in advance of any significant changes to their organizational structure or ownership. To keep abreast of future changes to the EB-5 program, follow our blog, follow us on twitter, or contact us and let us know you want to receive future updates.