Though the American Dream has somewhat lost its luster, the number of people wishing to move to the United States is not decreasing, and the green card continues to be a cherished dream for many.
The Trump administration is serious about reducing legal immigration in the coming years. It is also planned to stop Green Card lottery. At the same time, the government is still very supportive of those who invest in the US economy. Therefore, wealthy people wishing to grow their business in the United States will find the option of obtaining investor visa more attractive. The benefits of this option include the applicant’s ability to bring his/her spouse and children to the United States as well.
These three visa programs are most popular among the investors: EB-5, L1 and E-2. In this article we will highlight the conditions, advantages and disadvantages of each of the program.
The EB-5 Visa Program was launched in 1990 when the Congress of the United States set an objective of stimulating the US economy, attracting private foreign capital, creating additional jobs. The government only opens about 10,000 EB-5 spots for applicants per year, while the actual number of applications is usually much higher.
To qualify for the EB-5 visa an applicant is required to invest $1million or $500,000 (depending on the region) in the development of a US company. The lower cost is available to those investors who decided to invest in companies located in high unemployment regions or in rural areas called Targeted Employment Areas.
The program provides the following options of participation:
At the same time the investment schemes that guarantee the return of funds, such as lending to the existing businesses, are not allowed. Investments should be subject to risks.
Investments in regional centers are not so profitable, but in a way more reliable since these companies meet the conditions of the program without fail. An investor does not need to actively participate in asset management. Therefore, this option is often chosen by those who are interested primarily in moving to the United States.
Applicants are eligible to participate in the program if their capital exceeds $1 million or an annual income over the past two years is at least $200,000. There is an alternative requirement according to which the annual amount of joint income of the spouses should not be less than $300,000. According to the program conditions, the investor must create at least 10 full-time jobs for US citizens. At the same time, their salary should not be lower than the industry average. It is also important that the capital allocated for investment was fully legal; the income sources are subject to rigorous due diligence check. Supporting documents may include certificates on the sale of real estate or business, gift or inheritance certificates, data on profits from commercial activities.
For the first two years, the permanent residence is granted. This status is removed if the enterprise still meets program requirements, namely the required 10 jobs are maintained. The same status (first, conditional and then permanent) shall be granted to investor’s spouse and children younger than 21.
Advantages of EB-5 visa:
The disadvantages of the EB-5 visa include:
Important note: since 2016, the adjustment of the conditions for this type of visa has been discussed. It is proposed to increase the cost of participation in the program from $500,000 to $800,000 and from $1 million to $1.2 million, respectively. However, so far it has been decided to keep the terms of the program unchanged until December 2018.
The L1 visa is granted to senior managers and top-level specialists of foreign companies, who are relocated to work in a company’s US office. This type of visa allows an applicant together with his spouse and children under 21 years of age to reside in the United States. The spouse and children are granted an L2 visa.
To apply for this type of visa it is required:
The application process normally takes several months. Initially, the status is granted for 1 year to managers and specialized knowledge workers of branch offices of foreign companies that were established recently, and for 3 years in case an already existing and operating US business was acquired. Subsequently, the visa can be renewed every 2 years. In the case of specialized knowledge workers, the L1 visa is issued for a total period of up to 5 years. For managers this term is increased to 7 years. After that you need to work for at least 1 year outside the US, and then you can again apply for this visa. However, after 1 year of successful operation of the company, the management can apply for the grant of an EB-1 visa to the employee (top level management) which is immigration visa and leads to getting a green card.
To renew the visa after the first year, it is important to demonstrate the results of the manager’s work. It is easier in the case of a new business. On the one hand, if you buy an existing company, you can get the status for 2-3 years. However, it must be noted that such a business should have been a successfully operating one and have a clean financial history. Therefore, such purchase may be risky and require gathering support of a good financial expert to check all the details before acquiring the company.
The advantages of the L1 visa include its lower cost compared to the EB-5 program, as well as the prospect of applying for a green card after one-year of work. This is a business visa, so there is no need to prove that you don’t have intentions to immigrate. The applicant’s children can study in the US schools and universities, and the wife/husband has the right to work. This visa can be obtained at once by several employees of a foreign company, if they occupy sufficiently high positions.
The disadvantages include the requirement to have at least one-year work experience and being able to prove it. A foreign company must have been operating for at least one year, and only after that it may open a branch office in the United States and a visa application may be filed. Furthermore, it is rather difficult to foresee the actual amount of expenses. Though at the time of filing an application there should be at least $40,000-50,000 on the account of a branch office, the rental of the office and paying service fees to the staff may result in heavier expenses even for the first year of operation. In addition, with this option it is important to show the results of the work, so you need to pay enough attention to real business management.
The E-2 visa is an investor visa which is issued to foreign individuals wishing to grow their business in the United States. However, the applicants may be eligible for the program only if they come from the states which concluded a respective treaty with the United States. Such countries do not include China, Russia, Brazil, South Africa, Dubai, etc. Ukraine, Kazakhstan, Georgia, Armenia, Azerbaijan, Kyrgyzstan, Moldova and the Baltic States are on the list of countries signed the treaty with the US. Being a citizen of one of these countries allows you to apply for an E-2 business visa.
What are the options for the investors from China, Russia and other countries which did not sign the treaty with the US? The best option is to obtain the second citizenship of Grenada first. This is the only Caribbean country offering a second passport for purchase which allows applying for an E-2 visa in the United States.
There are no specific requirements to the amount of investments. It is only mentioned that the investments should be “substantial” and the threshold of minimum investment is approximately $50,000. These should be the funds commensurate with the purchase of a new or existing business, and sufficient for its development. The amount also depends on the industry in which the future company operates.
Still, apart from the already mentioned restrictions on the countries, the program has some other disadvantages. They include:
The main advantage of EB-5, L1 and E-2 programs is the possibility for the investors to get a visa not only for themselves but also for their family members. This gives their children access to US education, and the whole family will be able to benefit from the US healthcare and other positive aspects of the American way of life.
In terms of immigration, the EB-5 program is the most attractive. It allows you first to get a conditional, and then a permanent resident status. However, the costs involved in applying for this program are quite high. At the same time, there is an option of investing in regional centers, which means that the investor does not need to monitor compliance with all program conditions, and in many cases such income may become passive. The L1 and E-2 programs call for active participation in the company’s activities; however, the level of required investments for programs is much lower. The holder of the E-2 visa, who has achieved a certain success in business, may apply for an EB-5 visa. The L-1 visa gives you the right to apply for a permanent residence in the USA just one year later.