07/29/10
Summary of Immigration Options for Investors
Immigration is possible for people who invest $1 million in a new business, or $500,000 if the investment is in a targeted employment area (i.e., a rural area of less than 20,000 population or an area which as experienced high unemployment of at least 150% of the national average).The investment must be in the form of cash, equipment, inventory, property, cash equivalents and/or loans secured by the investor’s personal assets, not including other assets of the business, and for which he or she is personally liable. The investment must have originated from the investor and spouse, only. However, the investor may have partners who also contribute to the business in excess of the investor’s $1 million contribution. The investor has the burden of proving the source of their investment and that it was gained through lawful means.
The $1 million must be “at risk” meaning that there can be no guarantee that the investment will be returned. Except for citizens of China, promissory notes meet this requirement if the note is secured by the investor’s personal assets and the investor’s payments under the note are substantially complete prior to the end of the 2-year conditional residency period. The note cannot grant the investor the right to sell his interest back to his partners at a fixed price, guarantee interest or guarantee a return. None of the investment can be set aside as a reserve.
Multiple investors may seek to immigrate through a new business as long as each investor seeking to immigrate independently meets the $1 million investment requirement and job creation requirement. An investor may qualify by joining an existing partnership, even a limited partnership. The business may be a venture capital firm investing funds into multiple businesses, but in that case, the investor’s management of the business must be related to the VC firm, not the individual businesses. The investor must be engaged in the day-to-day operation of the business or through policy formation.
The investment must create at least 10 full time jobs within the 2-year conditional residence period. Individual workers may change, as long as some person is employed in each of the 10 full time positions. Independent contractors are not considered employees. The workers must be U.S. citizens or green card holders, not people using a temporary visa, the investor, or the investor’s family members.
Procedurally, we file a petition with USCIS, carefully documenting all of the above requirements and clearly showing that each of the requirements has been met, or will be met, within 2 years. The investor, spouse and children (under 21) are then granted Conditional Permanent Resident status (green card) valid for 2 years.
At the end of 2 years, we must clearly show, through detailed documentation, that the $1 million investment has been completed and that ten jobs have been created. There is some flexibility if the investor has “substantially met the capital investment requirement of the statutes” and “can be expected to create within a reasonable period of time 10 full-time jobs”, though USCIS has discretion to approve or deny removal of the condition under those circumstances.
The 2-year conditional permanent resident status and ability to travel will be extended by USCIS while it processes the petition to remove the condition. Delays are common at this stage. At the end of processing, the USCIS Service Center Director will either: 1) ask for more evidence and/or an interview; 2) approve the petition (making the investor, spouse and children Permanent Residents); or 3) deny it.
One very important consideration this memo does not discuss, but may be relevant in your case, is the Immigrant Investor Pilot Program which permits investment through regional centers. In that case, the investor invests in an USCIS approved company. It may be preferable to investors who do not want to be involved in operating the business or ensuring the direct hiring of 10 full-time workers. Please contact me if this alternative makes more sense to you so that we may further discuss it.