The EB-5 visa program, popular among the investors, will continue to accept applications at least until the end of September 2018. In late March, Donald Trump signed a bill on the allocation of budgetary funds for 2018, which also provides for the extension of the investment program for another six months.
The EB-5 visa program has been operating since 1990. Its goal is to attract foreign investors to participate in important infrastructure projects. The program has always been provisional and was occasionally extended by Congress, usually for a period of 3-5 years. However, after 2015, the terms of the extension became substantially shorter – from 1 week to 9 months. One of the most famous projects, funded within the program, is Hudson Yards, a complex of office and residential buildings in Manhattan.
Recently, the EB-5 investor program has been criticized by some American politicians. In particular, the opponents of the program are dissatisfied with the fact that funds are often used for elite development projects, rather than for the development of suburban areas or the construction of affordable housing.
Important note: many officials are putting forward proposals to reform the program. The government’s latest proposal envisaged raising the minimum investment threshold to $925,000. It is also likely that the number of jobs that need to be created will be increased from 10 to 12.
The EB-5 program is aimed at attracting foreign investment in the US economy and creating new jobs. In order to meet the requirements of the program, an investor must fulfill one of the following conditions:
In addition, investing in a new or existing business should be accompanied by the creation of 10 full-time jobs for the US citizens. It should also be taken into account that proving the legality of the invested funds is important for government structures. The investor can be refused merely because of the insufficient transparency of the origin of capital.
One of the conditions for participation in the program is sufficient material wellbeing. An investor must either own a fortune of at least $1 million, or his annual income should be at least $200,000 for each of the last two years.
After the application is approved and the required investment amount is contributed, the applicant gets a ‘conditional’ permanent residence for 2 years. To get a permanent green card it is required to submit an l-829 petition 90 days before the expiry of the two-year period. If all the conditions of the program are met and the required number of jobs is maintained, a resident’s conditional status is changed to unconditional.
GREAT MAJORITY OF APPLICANTS – MORE THAN 90% – PREFER TO INVEST THROUGH REGIONAL CENTERS.
Important note: Investing through regional centers is more popular, as this eliminates the need for constant monitoring of the investment project and fulfillment of program requirements. Furthermore, many projects involving such investments are associated with real estate and are potentially profitable. In any case, prior to investing assets, an investor has the right to conduct a thorough analysis of the project.
Along with the main investor, the status may be obtained by his spouse and children under the age of 21. In this case, investor’s children may attend colleges and universities.
There is a limit of maximum 10,000 visas issued per year within the EB-5 program. Until recently, the number of investors and their dependents was far from exhausting the annual quota. For example, in 2010 only 1885 visas were issued by the government. However, in 2011 their number almost doubled, being 3463. Then it began to consistently approach the limit – 7640 (2012), 8564 (2013), 9228 (2014), 9764 (2015), 9947 (2016). In 2017, the maximum number of visas was issued – 10 thousand.
Hudson Yards is a large-scale Manhattan development project, funded, inter alia, in the frames of the EB-5 visa program.
This increase in the program’s popularity is explained by the growing interest of investors from China. They account for 75-85% of all applicants. Due to such influx of those wishing to apply, there even formed a “waiting list” – in December 2017 it included 30,000 people, most of them Chinese citizens. In this regard, many industry experts began to talk about a possible increase in the quota to 24 thousand visas per year.
In recent years, the number of investors from other countries, primarily from Vietnam, Brazil and South Korea, has increased. Growing interest among Vietnamese and Brazilians is especially noticeable: in 2017 their share among the program participants increased 10 times.
NIGERIAN AND SOUTH AFRICAN INVESTORS ARE SHOWING GROWING INTEREST TO EB-5 VISA TO THE US. COMPARED TO 2012 THE NUMBER OF PROGRAM PARTICIPANTS HAS INCREASED ALMOST TWICE FROM SOUTH AFRICANS – FROM 34 TO 53, AND ALMOST THRICE FROM NIGERIANS – FROM 24 TO 89.
According to the data provided by Invest in the USA (IIUSA), the EB-5 visa program annually helps attract more than $4 billion of foreign investments, and also creates tens of thousands of jobs every year.
Advantages of the EB-5 investor program are obvious. They include the prospect for obtaining a green card, and further the US citizenship. Although the program will be open for till the end of September, its future is still just as vague. Moreover, in light of the current US policy concerning migration issues, the price threshold of the program is likely to be increased.