Aginsky Capital | EB-5
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Overview

EB-5 is a U.S. Immigrant Investor Program, created by Congress in 1990, that allows a foreign investor to obtain a Green Card and eventually, U.S. citizenship. The basic program requirements include:

 

- A minimum capital investment of $1 million (or $500,000 in TEAs)
- Legitimate source of funds with substantiating evidence
- Creation of 10 new jobs

 

Path to EB-5

United States Citizenship and Immigration Services (USCIS) administers the EB-5 program , which was created to stimulate the U.S. economy through job creation and capital investment by foreign investors. There are two structures through which you may invest:

 

Direct Investments

 

Entrepreneurs (and their spouses and unmarried children under 21) who make an investment in a commercial enterprise in the U.S. and who plan to create or preserve ten permanent full time jobs for qualified United States workers, are eligible to apply for a Green Card (permanent residence). Through this route, the investment has to generate direct jobs and not induced or indirect. The investment can be into an existing business or to set up a new business. The investor has the option of owning a minority or a majority stake.

 

Regional Centers

 

A Regional Center is defined by the USCIS 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. In other words, Regional Center is an entity that facilitates the pooling of capital from multiple EB-5 investors into various multimillion-dollar projects.

 

ACG will assist you with making an investment into either of the two structures for EB-5 and also provide recommendations with regard to which route makes most sense for the investor. Since we don’t officially represent any Regional Center, we can offer an unbiased, neutral view of what is in the investor’s best interest.

Requirements/qualifications

 

Capital Requirements

Capital means cash, equipment, inventory, other tangible property, cash equivalents and indebtedness secured by assets owned by the alien entrepreneur, provided that the alien entrepreneur is personally and primarily liable and that the assets of the new commercial enterprise upon which the petition is based are not used to secure any of the indebtedness.

Required minimum investments are

General: The minimum qualifying investment in the United States is $1 million.

Targeted Employment Area (High Unemployment or Rural Area): The minimum qualifying investment either within a high-unemployment area or rural area in the United States is $500,000.

Job Creation Requirements

The EB-5 investor must create or preserve at least 10 full-time 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.

Note that the investment must create 10 direct jobs per investor for the direct investment route. On other hand, the 10 jobs can be direct, indirect, or induced jobs per investor for the Regional Center route.

 

Note: Investors may only be credited with preserving jobs in a troubled business, which is defined as an enterprise that has been in existence for at least two years and has incurred a net loss during the 12-month or 24-month period prior to the priority date on the immigrant investor’s Form I-526. The loss for this period must be at least 20 percent of the troubled business’ net worth prior to the loss.

Benefits of EB-5

Benefits of EB-5 and becoming a U.S. Green Card holder

 

EB-5 is one of the quickest ways to obtain a U.S. permanent residency, eventually leading to citizenship. Permanent residency in the United States confers the majority of the rights and privileges of a native-born U.S. citizen to the investor and his immediate family including:

 

- Freedom to live and work anywhere in the U.S. indefinitely;

- Freedom to start a business or expand current business activities to the North American market;

- Access to the world’s most dynamic economy;

- Strong property rights and stable political system;

- Access to the American primary and secondary education system;

- Attending universities at the same cost as U.S. citizens;

- Travel easier globally (as U.S. Green Card holders can travel to 166 countries visa-free, or with visa on arrival);

- (Once citizenship is attained), ability to travel with a U.S. passport, one of the least restricted passports in the world.

 

* The only draw-back of U.S. citizenship, in our professional opinion, is the requirement to pay taxes for all Green Card holders on all of their world-wide income.

Services

Our team can help form a Special Purpose Vehicle (SPV), which will be owned by the client and used to acquire and manage the selected business asset(s).

Entity formation

We can help you identify potential investment assets that are ‘EB-5 eligible’. This will be a two-step process; (i) we will first create a long list based on a wide set of criteria and (ii) we will narrow it down to a much shorter list after screening it through a more stringent set of criteria and further discussions with you.

Identification of the asset

ACG and its service partners will assist you with transferring funds from your home country to the U.S. Each country has their own set of guidelines and regulations and we will help you navigate the entire process to ensure compliance and a smooth transaction.

International fund transfer advisory

We can conduct thorough due diligence on each of these potential acquisition targets to obtain and develop substantial analysis and detailed information about each potential investment vehicle. The due diligence will be comprehensive and will include (i) financial, (ii) EB-5 specific due diligence, (iii) legal, (iv) tax analysis, (v) personnel, (vi) physical assets, (vii) customers, etc.

Due diligence

ACG and its team of accountants and lawyers will review the source of funds and determine if the documentation is satisfactory. ACG will not file the application if the source of funds is not satisfactory.

Source of funds verification

Once the search has been narrowed down to the finalists, we will manage and structure any negotiations with the sellers, including contract drafting and signing.

Property Management

We will advise the buyer on how to structure the transaction. This may involve setting up a different kind of entity (corporation or a trust), negotiating additional seller financing, including earn-out options, etc.

Leasing Services

ACG will coordinate all the legal activity that is required for the EB-5 application including collection and review of the documents and filing the application. ACG will work with its partner law firms but as far as the client is concerned, there will be just one point of contact, making the process much simpler and streamlined.

Legal coordination for EB-5 application

We will draft a ’Matter of Ho’ compliant business plan post-acquisition, which is a key part of the application.

Business Plan

We will work in a transparent manner, providing monthly updates and quarterly financial reports to maintain an intimate understanding of the performance of the business. Also, there will be annual strategic reviews during which there may be considerations to expand or adapt the business.

Project and business reporting service