2017 San Gabriel Valley Realtors' Association Global Summit - Presentation on EB-5 and other business/immigration investment options under Trump administration

1. Albert Justin Lum
Lum Law Group
ajlum@lumlawgroup.com
(626) 236-0538

2.  You have a real estate client, he wants to come to the
United States, and he wants to stay here, maybe not
now, but he wants to eventually immigrate here. He
may or may not have his own company in a foreign
country.
 The question is how does he do it? How can real
estate contribute to his desire to immigrate to the
U.S.? Is it part of his plan to immigrate or to finance
his project in the U.S. (commercial) and/or a result of
that desire to immigrate (residential)?

3. 1. EB-5 Immigrant Investor
 - Traditional EB-5
 - Regional Center
2. Intracompany Transfer (L-1/EB-1C)

4. 3. EB-1A – Extraordinary Ability

5.  The Immigrant Investor Program, also known as “EB-5 Pilot
Program,” was created by Congress in 1990 to stimulate the U.S.
economy through job creation and capital investment by foreign
investors. Initially, the program was by direct investment. Under a
pilot program first enacted in 1992 certain EB-5 visas also are set
aside for investors in Regional Centers designated by U.S. Citizenship
and Immigration Service (“USCIS”) based on proposals for promoting
economic growth through foreign investment, but utilizing both
direct and indirect employment. In either case, the immigrant
investor obtains permanent resident status through investment in
the United States.
This program is currently scheduled to end on September 30, 2017,
but it will most likely be renewed by Congress, but with many
important changes

6.  1. Direct or Traditional EB-5 investment – Active
investment in Business
 2. Regional Center Project – Passive Investment in
Project (ex. hotel, shopping center, movie
production)
Either EB-5 program, Investor receives:
 2 year conditional permanent resident (green card)
status.
 Must later apply for permanent green card status by
end of conditional period, then receives permanent
green card status.

7.  1. Personal investment of $500,000 or $1,000,000*
depending on location of investment. Investment can
be in the form of Real Estate or Cash
 2. Create 10 full time jobs. – Citizens, legal residents,
non-residents authorized to work (not related to
investor).
 3. Doesn’t require any previous connection between
background of investor and the investment.
 *USCIS has currently requested that the program
amounts increase to $1,300,000 and $1,800,000
respectively.

8.  1. Long processing times before obtaining
conditional status and then permanent green
card status.
 2. For China investors – Additional 3 year
priority date waiting period before you can
file for conditional permanent resident status
– means if project is approved for EB-5
investment, must wait until priority date is
current before you can file for conditional
green card status.

9.  Direct investment in own company
 Active role in business
 Hire employees directly in the company for job
creation

10.  Direct control of money through company
 Direct control over ability to obtain
permanent resident card
 Can operate business

11.  Because of length of time until receiving
permanent resident status, may have to
operate a business for 5-7 years (only
matters if losing money)

12.  Passive investment
 No role in business
 Regional Center project utilizes direct and indirect
employment for job creation

13.  Not required to involved in project – passive investor
 Job creation determination is made based on
economic model, not actual jobs, so if USCIS approves
project, then investor should be able to get green
card.

14.  Investment, so money at risk, no control if project
goes under
 If project does not follow its plans, can have green
card taken away by USCIS

15.  Summary - Appeal of one model over the
other depends upon investor’s desire to
control his investment, and his risk
assessment of a Regional Center project vs.
traditional EB-5 project. Both carry risks and
depend upon an investor’s desire to have
control of the project.

16.  Intracompany transfer between parent foreign
company and U.S. subsidiary company
 L-1 visas for nonimmigrant
 EB-1C for immigrants

17.  *U.S. subsidiary company must have been organized
in the U.S. for at least one year in the United States,
the company may petition for managers or executives
to obtain permanent resident status – practically
speaking the time is usually longer.

18.  1. U.S. Company is owned at least 51% by foreign
company
 2. Manager/ executive transferred must have at least 1
year experience as manager/executive in parent company
within the last 3 years.
 3. Transferee must be working in subsidiary as manager
or executive (ex. 3 person subsidiary company unlikely to
qualify)
 4. Job and management experience should be related to
position in subsidiary.
 5. Subsidiary should have 7-8 employees of varying levels

19.  1. Setting up a subsidiary is less expensive
than investing in an EB-5 project, may only
need a few hundred thousand to start the
business
 2. Processing time to obtain non immigrant
visa or status (L-1) is 1 month to 4-5
months.
 3. Processing time to obtain permanent
resident status (EB-1C) may be up to 1 year.
 4. Fewer Employees to Hire (than for EB-5)

20.  1. Person being transferred must have been shown to
have worked in parent foreign company for the required
period of time as a manager/executive.
 2. Work experience and/or educational experience must
be related to new position in U.S. company.
 3. If from China, as of June, 2017, have a priority date of
five years if applying for change of status while in the
United States
 4. Generally more stringent regulation by USCIS.

21.  Purely depends upon goals and experience of
the investor.
 Also possible to combine different programs.

22.  “The EB-1 extraordinary ability classification
is for people who are recognized as being at
the very top of their field and who are coming
to the United States to continue work in that
field.”

23.  Demonstrate sustained national or international acclaim and
that your achievements have been recognized in the field of
expertise by showing:
 (1) received a major internationally recognized award (i.e.,
Nobel, Pulitzer, Oscar, Olympic Medal, etc.); or
 (2) meet at least three of the ten possible requirements
listed below and all your evidence, when evaluated together,
shows that you are among the small percentage of individuals
that have risen to the very top of your field.


24.  • Evidence of receipt of lesser nationally or
internationally recognized prizes or awards for excellence
 • Evidence of your membership in associations in the
field which demand outstanding achievement of their
members
 • Evidence of published material about you in
professional or major trade publications or other major
media
 • Evidence that you have been asked to judge the work
of others, either individually or on a panel
 • Evidence of your original scientific, scholarly, artistic,
athletic, or business-related contributions of major
significance to the field

25.  • Evidence of your authorship of scholarly articles in
professional or major trade publications or other major media
 • Evidence that your work has been displayed at artistic
exhibitions or showcases
 • Evidence of your performance of a leading or critical role
in distinguished organizations
 • Evidence that you command a high salary or other
significantly high remuneration in relation to others in the
field
 • Evidence of your commercial successes in the performing
arts

26.  Advantages:
◦ No monetary income or asset level required.
 Disadvantages:
◦ Must really be “famous”
◦ Similar waiting period for individuals in the U.S. to
adjust status

27.  It’s not about what party is in office.

28.  “ Trump, who last week signed an executive order calling
for an overhaul of high-skilled worker visas, has not
spoken out much on EB-5 visas.
 “The White House issued a statement to The Washington
Post this week saying that the Trump administration is
weighing changes to the foreign investor visa program.
 “‘There are serious concerns held by the administration
regarding the EB-5 visa program, in part because it is not
being used as it was primarily intended,” said Michael
Short, a White House spokesman. “The administration is
continuing to evaluate reforms to the program, which we
believe is in need of substantial repair.’”

 Tracy Jan
 Washington Post
 April 27, 2017

29.  Kushner Family Stands to Gain From Visa Rules in
Trump’s First Major Law
 (Extension of present program, unchanged, to
September 30, 2017)

30.  1. January 2017 – Proposed elimination of
EB-5 program (Sen. Dianne Feinstein (D-CA),
Sen. Charles Grassley (R-Iowa) – U.S.
citizenship for sale.

31.  2. April 2017 – USCIS some proposed changes:
 Raising standard investment requirement from
$1.0 million to $1.8 million (80% increase);
 Raising TEA investment requirement from
$500,000 to $1.35 million (270% increase);
 Limiting TEA to mostly rural investments, and
only limited urban investments; and
 Applying aforementioned dollar amounts
retroactively to EB-5 projects previously
established and approved under the current law;

33.  Greater emphasis on forms of application -
Did you dot your “I”s and cross your “T”s?;
 Longer waiting periods;
 More strict review of application materials;
 Greater emphasis on police aspect of
position, rather than helping people to
complete their immigration; and
 EB-5s – Transition from perception of
fraudulent EB-5s as defrauding immigrant
investors to assisting unscrupulous
immigrants to obtain PR status fraudulently.

34.  “Same as it ever was”
 (Talking Heads – Once in a lifetime)
 Common Sense in:
◦ - Knowing the investment you will make (EB-5)
◦ - Operating a business that is an appropriate size
for the type of immigration (EB-5, EB-1C)
◦ - Making sure you have the proper documentation
and evidence (any visa).
◦ It’s not about whether you show enough evidence,
it’s about utilizing all the evidence you have.

35.  Questions?
 Albert Justin Lum
 Lum Law Group
 Pasadena, California
 626-236-0538
 ajlum@lumlawgroup.com