EB-5 Immigrant Investor Program: Direct investment vs. Regional Center investment


Under the EB-5 Immigrant Investor Program, foreign investors can apply for a green card if they 1) invest in a company in the United States and 2) plan to create ten permanent full-time jobs for qualified US workers. There are two options for an EB-5 investment: 1) direct investment or 2) regional center investment.  While both methods provide access to permanent residence, the EB-5 investor should be familiar with the differences between the two options before investing.

Direct investment

A direct investment is best suited for an investor who wants to own and be directly involved in the day-to-day operation of the company. The investor should be well-versed in business practices, since this option requires more time and effort. The investor should also formulate a business plan that will project the creation of ten jobs for qualified US workers within two years after becoming a conditional lawful permanent resident. A qualified US worker is a US citizen, lawful permanent resident, or other immigrant lawfully authorized to be employed in the United States.

Regional Center investment

EB-5 requirements for an investor who has invested in a Regional Center project are essentially the same as a direct investment. The only difference is that these investments are affiliated with an economic unit known as a “Regional Center.”  A Regional Center is a business entity that coordinates foreign EB-5 investment within an area in compliance with EB-5 statutory, regulatory, and precedent decision framework.

A regional center investment is best suited for an investor who would rather participate in the policy-making activities of the business, instead of managing the day-to-day activities of the business. Limited partnerships and limited liability companies have generally been recognized as appropriate investment vehicles under the EB-5 program. The benefit of a regional center investment is that regional centers are permitted to use reasonable job creation methodologies to calculate direct, indirect, and induced jobs. Thus, regional centers are able to solicit several to hundreds of EB-5 investors for their EB-5 projects, since indirect and induced jobs can be counted towards the total job creation count.

Conclusion

It’s important to note that both types of investments provide access to a green card for the investor and his/her family. Also, both types of investments have the same processing timeline. There is currently no wait time for EB-5s for Filipino nationals, and through an EB-5 investment, the investor can apply for green cards for himself, his spouse, and unmarried children under the age of 21. As a green card holder, you are considered a lawful permanent resident of the US, which allows you to lawfully reside in the US, work in the US, and travel internationally with your green card.

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Catharine Yen manages the immigration department at Sullivan, Krieger, Truong, Spagnola, and Klausner. She has a 100% approval rate for filed EB-5 petitions. She has spoken at national conferences and co-authored several articles on various EB-5 topics. 

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