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Immigration Options for  Foreign Investors Eric Riess / Tiffany Baldwin
Visas <ul><li>Nonimmigrant (temporary) </li></ul><ul><ul><li>E-2: Treaty Investors </li></ul></ul><ul><li>Permanent Reside...
E-2 Eligibility Requirements <ul><li>The investor is a national of a treaty country;  </li></ul><ul><li>The purpose is to ...
Ownership & Nationality <ul><li>Ownership may be as: </li></ul><ul><ul><li>an individual proprietor, </li></ul></ul><ul><u...
What is a “substantial” investment? <ul><li>“ Substantial investment”:  </li></ul><ul><ul><li>Sufficient funds to ensure a...
“Proportionality Test” <ul><li>Compares the total amount invested in the enterprise with the cost of establishing a viable...
General Guidelines <ul><li>In general, a franchisee will have a substantial investment if: </li></ul><ul><li>Cost = $100K ...
Source of Investment Funds <ul><li>The investor must have  </li></ul><ul><li>Possession and control of the capital and fun...
Viable Business <ul><li>Enterprise must have started operating or be close to the start of actual business operations,  </...
Viable Business <ul><li>Enterprise must produce some service or commodity.  </li></ul><ul><li>Enterprise cannot be a paper...
Nonmarginal Business <ul><li>No minimum business size specified </li></ul><ul><li>Cannot be solely for the purpose of earn...
Nonmarginal Business <ul><li>If the income derived from the enterprise exceeds what is necessary to support the investor a...
Employees <ul><li>Certain employees may also obtain E-2s if: </li></ul><ul><li>Principal E-2 investor personally operates ...
Spouse & Children <ul><li>E-2s available to E-2 investor’s spouse and children, regardless of nationality </li></ul><ul><l...
EB-5 Permanent Residence <ul><li>Does not require the investor to manage the day-to-day affairs of a business.  </li></ul>...
EB-5 Permanent Residence <ul><li>Investors eligible by :  </li></ul><ul><li>Creating a business;  </li></ul><ul><li>Invest...
Business Creation <ul><li>Investor must establish a new commercial enterprise by:  </li></ul><ul><li>Creating an original ...
Investment <ul><li>Investment in the new commercial enterprise must be:   </li></ul><ul><ul><li>at least $1,000,000, or  <...
Investment <ul><li>Investment by EB-5 application must be: </li></ul><ul><li>At risk in the commercial enterprise, </li></...
Source of Funds <ul><li>Loans: </li></ul><ul><ul><li>Must be secured by assets owned by the investor; </li></ul></ul><ul><...
Source of Funds <ul><li>Assets acquired, directly or indirectly, by unlawful means (such as criminal activities) not permi...
Job Creation <ul><li>New commercial enterprise will benefit the United States economy by:  </li></ul><ul><ul><li>Employing...
“Engaging” in the Enterprise <ul><li>Investor must “engage” in the new commercial enterprise which requires: </li></ul><ul...
Multiple Investors <ul><li>Two or more individuals may join to make a single new commercial enterprise to be used for EB-5...
Multiple Investors <ul><li>A multi-owner new commercial enterprise may also be used for EB-5 even when some owners of the ...
Conditional Grant of LPR <ul><li>EB-5 investors receive a conditional “greencard” valid for two years.  </li></ul><ul><li>...
QUESTIONS? <ul><li>Eric: </li></ul><ul><li>[email_address] </li></ul><ul><li>(314) 345-4723 </li></ul><ul><li>Tiffany: </l...
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Investor Webinar

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Investor Webinar

  1. 1. Immigration Options for Foreign Investors Eric Riess / Tiffany Baldwin
  2. 2. Visas <ul><li>Nonimmigrant (temporary) </li></ul><ul><ul><li>E-2: Treaty Investors </li></ul></ul><ul><li>Permanent Residence (aka Greencard) visa </li></ul><ul><ul><li>Employment-based Preference </li></ul></ul>
  3. 3. E-2 Eligibility Requirements <ul><li>The investor is a national of a treaty country; </li></ul><ul><li>The purpose is to develop and direct the operations of an enterprise, such as a franchise, in which the individual has substantially invested; and </li></ul><ul><li>The investor must have more than 50% percent ownership of the investment. </li></ul>
  4. 4. Ownership & Nationality <ul><li>Ownership may be as: </li></ul><ul><ul><li>an individual proprietor, </li></ul></ul><ul><ul><li>majority partner, or </li></ul></ul><ul><ul><li>majority corporate shareholder. </li></ul></ul><ul><li>Investor must possess the nationality of the treaty country (60+ nations with treaties) </li></ul><ul><ul><li>Nationality of a business is determined by the nationality of the individual owners of that business. </li></ul></ul><ul><li>Investor must have control of the US business by owning at least 50 percent of the enterprise. </li></ul>
  5. 5. What is a “substantial” investment? <ul><li>“ Substantial investment”: </li></ul><ul><ul><li>Sufficient funds to ensure a financial commitment to the successful operation. </li></ul></ul><ul><ul><li>No minimum dollar amount to qualify. </li></ul></ul>
  6. 6. “Proportionality Test” <ul><li>Compares the total amount invested in the enterprise with the cost of establishing a viable enterprise </li></ul><ul><li>Inverted sliding scale – </li></ul><ul><ul><li>Smaller business = higher percentage of investment </li></ul></ul><ul><ul><li>Large business = lower percentage of qualifying investment. </li></ul></ul>
  7. 7. General Guidelines <ul><li>In general, a franchisee will have a substantial investment if: </li></ul><ul><li>Cost = $100K - $500K and investment is at least 75% </li></ul><ul><li>Cost = $500K - $1M and investment is at least 60% </li></ul><ul><li>Cost = $1M - $3M and investment is at least 50% </li></ul>
  8. 8. Source of Investment Funds <ul><li>The investor must have </li></ul><ul><li>Possession and control of the capital and funds invested. </li></ul><ul><li>Acquired the funds from lawful sources. </li></ul><ul><li>Any loans used as the E-2 investment to be secured by the investor’s personal assets. </li></ul><ul><li>The funds and assets to be invested must be committed to the investment, and the commitment must be real and irrevocable. </li></ul>
  9. 9. Viable Business <ul><li>Enterprise must have started operating or be close to the start of actual business operations, </li></ul><ul><li>Mere intent to invest or possession of uncommitted funds in a bank account does not satisfy the E-2 visa requirements. </li></ul>
  10. 10. Viable Business <ul><li>Enterprise must produce some service or commodity. </li></ul><ul><li>Enterprise cannot be a paper organization or an idle speculative investment held for potential appreciation in value </li></ul><ul><li>Must be a commercial, for-profit enterprise. </li></ul>
  11. 11. Nonmarginal Business <ul><li>No minimum business size specified </li></ul><ul><li>Cannot be solely for the purpose of earning a living. </li></ul><ul><li>Even if investment is substantial, no E-2 if the investment will return only enough income to provide a living for the investor and family. </li></ul>
  12. 12. Nonmarginal Business <ul><li>If the income derived from the enterprise exceeds what is necessary to support the investor and family, then the business is sufficiently large. </li></ul><ul><li>If it does not, then look at the economic impact of the business. </li></ul><ul><ul><li>significant economic contribution such as employing US workers. </li></ul></ul><ul><ul><li>projected profit should be realized within five years from the start of business operations. </li></ul></ul>
  13. 13. Employees <ul><li>Certain employees may also obtain E-2s if: </li></ul><ul><li>Principal E-2 investor personally operates the enterprise, or </li></ul><ul><li>Employee and principal investor share the same nationality. </li></ul><ul><li>Employee coming to the U.S. for work in an executive or managerial capacity or as an essential skilled worker. </li></ul>
  14. 14. Spouse & Children <ul><li>E-2s available to E-2 investor’s spouse and children, regardless of nationality </li></ul><ul><li>Children must be unmarried and under 21 </li></ul><ul><li>Spouses may apply for an employment authorization document </li></ul><ul><ul><li>Open employment: work anywhere </li></ul></ul><ul><ul><li>Start his or her own business </li></ul></ul><ul><ul><li>Full-time or part-time. </li></ul></ul><ul><li>Spouse and children may attend school under the dependent E-2. </li></ul>
  15. 15. EB-5 Permanent Residence <ul><li>Does not require the investor to manage the day-to-day affairs of a business. </li></ul><ul><li>Can invest in an existing business or a new business. </li></ul><ul><li>More than one person may invest in the same business. </li></ul><ul><li>Investor may be a minority owner of the business. </li></ul>
  16. 16. EB-5 Permanent Residence <ul><li>Investors eligible by : </li></ul><ul><li>Creating a business; </li></ul><ul><li>Investing $1,000,000 ($500,000 in certain targeted areas); and </li></ul><ul><li>Create at least 10 full-time jobs for U.S. workers. </li></ul>
  17. 17. Business Creation <ul><li>Investor must establish a new commercial enterprise by: </li></ul><ul><li>Creating an original business; </li></ul><ul><li>Restructure or reorganize an existing business thus creating a new commercial enterprise; </li></ul><ul><li>Expanding an existing business by 140%; or </li></ul><ul><li>Reviving a “troubled business” that has lost 20% of its net worth </li></ul>
  18. 18. Investment <ul><li>Investment in the new commercial enterprise must be: </li></ul><ul><ul><li>at least $1,000,000, or </li></ul></ul><ul><ul><li>least $500,000 where the investment is being made in a &quot;targeted employment area,“: </li></ul></ul><ul><ul><ul><li>An area with an unemployment of at least 150% of the national average rate or </li></ul></ul></ul><ul><ul><ul><li>A rural area as designated by OMB. </li></ul></ul></ul>
  19. 19. Investment <ul><li>Investment by EB-5 application must be: </li></ul><ul><li>At risk in the commercial enterprise, </li></ul><ul><li>Fully committed, and </li></ul><ul><li>Immediately available. </li></ul><ul><li>Investment defined as “capital”: cash and cash equivalents, equipment, inventory, and other tangible property. </li></ul>
  20. 20. Source of Funds <ul><li>Loans: </li></ul><ul><ul><li>Must be secured by assets owned by the investor; </li></ul></ul><ul><ul><li>Investor must be personally and primarily liable, and </li></ul></ul><ul><ul><li>Assets of the new commercial enterprise cannot be used to secure any of the indebtedness. </li></ul></ul>
  21. 21. Source of Funds <ul><li>Assets acquired, directly or indirectly, by unlawful means (such as criminal activities) not permitted </li></ul><ul><ul><li>Must document the &quot;path of funds&quot; from source to investment </li></ul></ul><ul><ul><li>Must document a &quot;pattern of income” that could account for attaining the capital </li></ul></ul>
  22. 22. Job Creation <ul><li>New commercial enterprise will benefit the United States economy by: </li></ul><ul><ul><li>Employing 10 or more U.S. workers full-time; or </li></ul></ul><ul><ul><li>With regard to “troubled businesses”, maintain the number of existing employees at no less than the pre-investment level for a period of at least two years. </li></ul></ul>
  23. 23. “Engaging” in the Enterprise <ul><li>Investor must “engage” in the new commercial enterprise which requires: </li></ul><ul><ul><li>More than a purely passive role </li></ul></ul><ul><ul><li>Involvement in the management, either by: </li></ul></ul><ul><ul><ul><li>day-to-day managerial control or </li></ul></ul></ul><ul><ul><ul><li>policy formulation. </li></ul></ul></ul><ul><li>Corporate officer or board member = engaging </li></ul>
  24. 24. Multiple Investors <ul><li>Two or more individuals may join to make a single new commercial enterprise to be used for EB-5, provided that: </li></ul><ul><ul><li>Each petitioning investor has invested/is investing the required amount; </li></ul></ul><ul><ul><li>The creation of at least 10 qualifying full-time jobs may be attributable to each investor; </li></ul></ul><ul><ul><li>The source(s) of all capital invested is (are) identified; and </li></ul></ul><ul><ul><li>All invested capital has been derived by lawful means. </li></ul></ul>
  25. 25. Multiple Investors <ul><li>A multi-owner new commercial enterprise may also be used for EB-5 even when some owners of the enterprise are not seeking classification. </li></ul>
  26. 26. Conditional Grant of LPR <ul><li>EB-5 investors receive a conditional “greencard” valid for two years. </li></ul><ul><li>At the end of the 2-year period, must file to remove the conditions by showing that: </li></ul><ul><ul><li>their money was &quot;at risk&quot; during the two-year period, </li></ul></ul><ul><ul><li>The requisite jobs have been created. </li></ul></ul>
  27. 27. QUESTIONS? <ul><li>Eric: </li></ul><ul><li>[email_address] </li></ul><ul><li>(314) 345-4723 </li></ul><ul><li>Tiffany: </li></ul><ul><li>[email_address] </li></ul><ul><li>(314) 516-2617 </li></ul><ul><li>Blog: </li></ul><ul><li>immigrationchronicle.wordpress.com </li></ul><ul><li>Twitter: @tlbaldwinlaw </li></ul>

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