Clear your doubts regarding the “Investor Visa”.

From the daily dealings with my fellow Latin Americans, I have noticed that there is confusion in relation to the issue of “Investor Visa” that in the next lines I will try to clarify.

The essence of the misunderstanding is that Many people assign the title of "Investor Visa" to two types of visas that differ substantially in terms of their purpose, scope and mode of granting. These visas are the EB-5 visa and the E-2 visa.

  • The EB-5 Visa

The EB-5 visa is so named because it is fifth in order of preference of employment-based visas (EB=Employment Based) that grant the possibility of obtaining residence (Green Card) to “breaks”, bypassing temporary nonimmigrant status. EB-5, known colloquially as the "half million visa," was enacted by Congress in 1990 as a formula to increase foreign investment and improve domestic employment levels.

In 1992, a pilot immigration program based on so-called "Regional Centers" was incorporated into the original concept of EB-5. Regional Centers are public or private entities authorized by the USCIS to promote economic activities that generate high levels of employment by attracting foreign capital..

With the introduction of the Regional Center the regulatory norm of the EB-5 visa has been divided into two aspects:

  1. The primary version that grants the beneficiary the residence if he develops a business activity under his own tutelage, that generates 10 or more jobs, with a minimum investment of $1 in normal areas or $000,000 in economically affected areas.
  2. The version that grants the beneficiary residency if he invests $500,000 in stocks or shares of a project qualified by the Federal Government (USCIS) as a “Regional Center” for the purposes of the Immigration Law.

We see here that the investor can manage his own company, in case 1, or acquire shares in an investment project classified by the Federal Government as a "Regional Center" and thus remain a passive investor, in case 2.

The residence granted under the EB-5 category is conditional. The foreign investor must file a petition to remove the condition within the second anniversary of the grant of residence. If it is determined that the foreigner did not keep the new company operating in accordance with the commitments acquired with the Federal Government or if the Regional Center ceased its activity, the "Green Card” will be suspended.

At this point it is convenient to point out some warnings to those who intend to take advantage of the EB-5 program to emigrate to the US.

  • To qualify for the EB-5 visa, you must have substantial assets that allows the investor to cover the amount of his investment plus the expenses of professional fees and registration rights and, going further, that the eventual loss of these amounts does not have catastrophic effects on his business life.
  • Although the EB-5 program grants temporary residency to the investor and his or her spouse and children under the age of 21, There is a possibility that the migratory benefit will be lost if the Regional Center project that supports it fails before the first two years of execution..
  • The investment in an EB-5 Project is not guaranteed by the government, so the investor must bear the business risk inherent in any private investment.. It is essential to carry out a thorough evaluation of the background of the promoters as well as the verification of the information contained in the investment prospectus in order to minimize the risk.
  • Since the investment is tied to the granting of the EB-5 visa, it is highly recommended to place the $500,000 in a trust account (escrow account) and subject its disbursement to visa approval.

The EB-5 program has become especially popular among the conglomerate of Chinese investors and is becoming topical among Hispanic groups that seek better levels of legal security and economic stability in the US.

  • The E-2 Visa

The E-2 Visa, on the other hand, is a non-immigrant visa that is granted to a foreigner who expresses his/her willingness to invest a "substantial amount" in a new or existing business., capable of generating enough income to cover the expenses of the company and to create surpluses that support the living expenses of the beneficiary and his family. The E-2 visa can also be granted to executives or specialized technicians who join the company managed by the beneficiary-investor of the E-2 visa.

The business in question must involve the active participation of the beneficiary in the direction of the operations of the company. For these purposes, it is considered that the company must, in “good faith”, carry out commercial activities that generate goods and/or services for profit. The beneficiary must demonstrate that he has shareholding and managerial control of the company as well as his willingness to be in charge of operational activities.

Consequently, passive investments such as the acquisition of real estate or stock papers, made for speculative purposes, do not serve to support the E-2 visa application. The business, meanwhile, can be a new business or an existing business.

It's important to know that the North American immigration authorities will verify the legitimacy of the origin of the funds to be invested and will also verify that the funds are the property of the applicant -not borrowed- and that they will be invested in accordance with what is stated in the visa application. For the purposes of visa processing, practice indicates that an investment amount equal to or greater than US$150,000 could be considered a "substantial amount" sufficient to support the application before the immigration authorities.

To date, only citizens of the countries listed in the following table can benefit from the E-2 visa programs.

Beneficiary Countries of the E-2 Visa Program

AlbaniaSouth KoreaJapanCzech Republic
GermanyCosta RicaJordanSlovak Republic
ArgentinaEcuadorKazakstanUnited Kingdom
ArmeniaEstoniaKirguizistánRomania
AustraliaEgyptlatviaSenegal
AustriaSpainLiberiaSuriname
AzerbaiyánEthiopiaLuxembourgSri Lanka
BangladeshPhilippinesMexicoSweden
BelgiumFinlandMoroccoSwitzerland
BelarusFranceMoldovaThailand
Bosnia-HerzegovinaGeorgiaMongoliaTogo
BulgariaGrenadaNorwayTrinidad and Tobago
CameroonHondurasOmanmoney
CanadaIranNetherlandsTürkiye
Chinese (Taiwan)IrelandPakistanUkraine
ColombiaItalyPanamaUzbekistan
CongoJamaicaPolandYugoslavia

Source: USCIS (5/28/2015)

It is important to point out that the applicant for an E-2 visa, whether he is an investor or an employee of the investor, must at all times express his intention to No. stay in the country for periods longer than those contemplated in the visa, even when you are able to renew it in perpetuity. This legal circumstance prevents the beneficiaries of this visa from changing their status from non-immigrant to immigrant.

Conclusions

In succinct terms, three essential differences can be drawn between the two types of existing “investor visas”:

  • The EB-5 visa requires a minimum investment of US$500,000 while the E-2 requires about US$150,000.
  • The EB-5 Visa leads to residency while the E-2 does not support that possibility.
  • The EB-5 visa allows the beneficiary to operate their business or passively invest in third-party businesses; the E-2 limits the activity of investor to the company for which it was authorized.

To delve into the subject I recommend visiting the website www.uscis.gov which extensively covers aspects related to US immigration law.

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