By: Kyle J. Barella, Esq.
Despite past scandal and a tarnished reputation among certain American politicians, the EB-5 investor visa remains an attractive and successful path for obtaining US permanent residency (Green Card).
The often negative press surrounding the EB-5 visa is underserved, as it focuses solely on corrupt project developers, greedy foreign agents, and incompetent immigration lawyers. It fails to highlight the success stories (which are many) and the contributions EB-5 investors make to US culture, and more importantly, the US economy.
The EB-5 program allows high-net-worth individuals the opportunity to obtain a Green Card in exchange for a large investment in a US business which must create (or save) ten (10) full-time jobs for US citizens (or those authorised to work in the US). The current investment is set at $1 million USD, which may be reduced to $500,000 USD for investments located in Targeted Employment Areas (TEAs).
Who qualifies for the EB-5 visa program?
The advantage of the EB-5 visa scheme is that there are no educational or language requirements. One needs no familial ties in the United States and does not require a job offer from a US company. In addition to being of good moral character (clean law enforcement history), an investor must simply be able to meet the minimum investment amount.
When consulting with a potential EB-5 client, our firm performs an assessment to ensure the investor qualifies for their selected EB-5 project. In addition to our assessment, we ensure the potential client has a realistic view of the EB-5 program. We often advise that the EB-5 investment is not a ‘get rich’ type of investment. In fact, the return on investment (ROI) is usually quite low. We recommend potential investors keep in mind the three goals of the EB-5 visa program, as outlined by Barella Global.
The first goal is to obtain the Green Card (US permanent resident status).
The second goal is to recoup the initial capital contribution (i.e. $500,000 USD in the case of a Regional Center investment).
Finally, the third goal would be to make a little money off the investment if at all possible.
A successful EB-5 investment in the opinion of our firm is one where the investor obtains their Green Card and eventually recoups their initial investment. In this instance, the investor has essentially immigrated to the United States for next to nothing.
Who should avoid the EB-5 visa?
Unfortunately, the EB-5 visa is not a suitable option for everyone considering immigration to the United States. Potential EB-5 investors who would be spending a significant amount of their net-worth to fund the investment should be cautious about proceeding down the EB-5 path.
Like with any investment, there is always risk involved. In fact, one of the rules regulating the EB-5 program strictly forbids guaranteed investments.
Nevertheless, clients who will be spending a large amount of their savings to proceed with the visa can successfully obtain their Green Card if they are fully informed and knowledgable about the EB-5 program and the individual project they choose to invest in. We always advise potential investors speak with an EB-5 lawyer before reaching out to EB-5 projects or Regional Centers independently.
How much can I expect to spend?
How much money an investor typically spends depends on whether they proceed with a Regional Center investment or a Direct EB-5 investment. The below figures account for a standard Regional Center EB-5 investment (by far the most popular route utilised by investors).
EB-5 capital contribution = $500,000 USD
EB-5 project administration fee = $30,000 USD - $50,000 USD
EB-5 government filing fees = $3,675 USD
Embassy Fees = $500 USD
EB-5 Lawyer Professional Fee = $15,000 USD - $25,000 USD
Approximate Total Cost = $549,175 USD - $579,175 USD
Why is the negative EB-5 reputation undeserved?
As mentioned above, the vast majority of media outlets only focus on the scandal caused by corrupt projects and inexperienced lawyers. The vast majority of EB-5 cases process successfully through USCIS. Unfortunately, as is typical with any industry, a few ‘bad apples’ cast a negative light over the overwhelming successful EB-5 industry.
The real truth about EB-5 investors and their family is that they contribute tremendously to the US economy. Not only is their investment required to create employment for ten (10) workers, they often end up establishing additional businesses in the United States which produce more jobs. EB-5 investors also contribute through paying taxes, purchasing real estate and consumer goods, all of which benefit the United States. EB-5 investors are the type of immigrants the US wants and needs.
The Barella Global Advantage
I founded Barella Global with a focus on assisting EB-5 investors in their dream of achieving US permanent residency. Prior to my work as Managing Attorney of the firm, I worked for a prominent London based US immigration firm where I was the lead EB-5 counsel. Additionally, I previously served as External General Counsel for a successful EB-5 investment advisory firm. We have a great deal of experience assisting EB-5 investors and provide concierge style service to our investor clientele.
We are the only US immigration firm in Europe with a dedicated EB-5 website. We assist high-net-worth investors throughout Europe. We maintain offices in London and Brussels to work conveniently with our clients in their timezone.
To learn more about the EB-5 visa program and how Barella Global can assist you, contact our London or Brussels office to arrange a consultation. Additional information may be found on our firm’s website, www.barellalaw.com or our dedicated EB-5 website, www.eb5investmentlaw.com.
E2 Treaty Investor Visa versus L-1 New Office/Transfer Visa: Which visa works best for your business?
Frequently our firm receives telephone calls from potential clients asking for our quote to source their company a L-1A visa for an executives or managers. After collecting the requisite preliminary information, the first question we ask is why do they believe the L-1A visa is the best visa option for their company.
Were they advised by a US immigration lawyer this is the appropriate visa? Have they previously transferred employees to a US branch or subsidiary office under this visa category?
The most common answer received is usually the potential client informing us they did a bit of independent research online and found the L-1A visa best fit their company’s needs.
However, is the L visa always the best option for transferring an employee abroad or establishing a new branch, subsidiary, or related office in the United States?
Unfortunately, there isn’t a straightforward answer to this question. Much depends on the company, the employee to be transferred, and the longterm corporate immigration goals. Nevertheless, most potential clients who ring our office inquiring about the L visa do not realise there may be a more suitable visa category which would save their company time and money.
At the most basic level, the L-1 visa allows a company to transfer an executive or managerial employee to an existing US subsidiary or branch office, or establish a new branch or subsidiary company in the United States.
If approved, employees being transferred to an already existing related office will be granted the L-1A visa for a period of three (3) years. New office L visa petitions will be granted for a period of one (1) year. A new office is any related US entity which has been operating (i.e. trading) for a period of less than one (1) year.
Nationals of certain countries, including the United Kingdom, Belgium, and much of the European Union, may benefit from exploring an alternative visa option which accomplishes the same goal as the L-1 visa. This options is the E-2 Treaty Investor Visa.
Why is the E-2 a better option over the L-1 visa?
For qualified applicants, the E-2 visa may be a more cost effective solution. This is particularly the case for those exploring the idea of opening of a new US branch or subsidiary.
As discussed above, the L-1 visa for a new office in the United States will be granted for a maximum period of one (1) year. Alternatively, the E-2 investor visa may be granted for a period of five (5) years. This includes visas for startups.
By utilising the E-2 visa, clients can save valuable time and money should they obtain a five (5) year visa over a one (1) year L-1 visa. Additionally, the E-2 visa is processed directly through the investor’s local US Embassy or Consulate. The L-1 visa, although partially processed at the consular level, must first go through adjudication at USCIS in the United States. Further, the government filing fees for the L-1 visa are approximately $2,000 USD, whilst the E-2 government fees are approximately $350 USD.
Most US immigration lawyers are also of the opinion that the burden of proof required by US immigration officials is higher for L-1 visas being processed through USCIS versus the E-2 visa at the consular level.
Some potential clients wish to explore the L-1 visa as they do not want to make an investment in the business, as required by the E-2 visa. However, both the E-2 and L-1 visas have similar requirements which inevitably lead to an investment in the US enterprise.
Both visa categories require a US entity to be incorporated, an office space to be secured, and the appropriate equipment and operating capital to begin trading. Both visas also require a comprehensive business plan to be submitted along with the petition/application.
In the end, most qualified clients are better suited to proceed with the E-2 visa over the L-1 visa, as they will save money and have the potential to be granted a visa for a longer period.
When would the E-2 visa not be an appropriate visa option over the L-1 visa?
As the E-2 visa is treaty based, nationals of countries that do not have the requisite treaty with the United States are not eligible for the E-2 visa.
For example, if a potential client holding a Russian passport consulted with our office regarding a business expansion visa, we would not discuss the E-2 visa as the United States do not maintain a treaty with Russia.
Fortunately, Belgium, the United Kingdom, and much of the EU do maintain an E-2 treaty with the United States.
Some larger companies with complex corporate structures may also not qualify for E-2 visa status if they are unable to account for at least 50% ownership from the same treaty company.
Take the following hypothetical.
Acme Company Ltd. is a United Kingdom limited company looking to make a US expansion and send over their VP of Operations, a UK national, to run the new US entity. The US entity, Acme Company LLC is owned 100% by Acme Company Ltd.
Acme Company Ltd. is privately owned by four individuals. One of the owners is a United Kingdom national. The remaining three owners are Belgian nationals.
We would not be able to proceed with the E-2 visa in this scenario, as the employee needing to be transferred is a UK national, and the ultimate owner of the US entity is not owned at least 50% by UK nationals (only 25%).
Alternatively, since Belgium is also an E-2 treaty country, the company could be registered as an E-2 entity if they wished to send employees to the US who also hold Belgian nationality.
Contact our London or Brussels office to speak with a US immigration lawyer and to learn more about your business’ US expansion options.
Barella Global | www.barellalaw.com