Visa Lawyer Blog

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Currently there is a major difference between US Citizens sponsoring foreign spouses to residency, and Permanent Residents (Green Card holders), that are filing for their spouses.

Green card holders married to non-U.S. citizens are able to legally bring their spouses and minor children to join them in the USA, but only after an extensive multi-year delay, during which time the family is separated. The foreign spouse of a green card holder must wait for approval of an ‘immigrant visa’ from the State Department before entering the United States.

Due to numerical limitation on the number of these visas, the current wait time for approval is four to five years for all non-retrogressed countries (including Western Europe), and many more for the retrogressed countries. In the interim, the spouse cannot be legally present in the United States (let alone work), unless he/she secures a visa for himself/herself using some other means.

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A recent liaison meeting with the Customs and Border Protection unit in San Diego provided some clarification on some recent issues with nonimmigrant visas. Below are some questions and answers on some of the nonimmigrant visa issues that were raised at the meeting.

B-2 Admissions – Length of Aggregate Admission in One Year

AILA members report that CBP officers are instructing applicants for admission as B-2 visitors that they are limited to a total period in the United States of no more than six-months in one year. Nonimmigrant aliens who apply for admission as B-2 visitors are being questioned regarding the number of occasions on which they have been in the United States to confirm that the alien has not exceeded 180 days. The U.S. Department of Homeland Security (DHS) regulation, however, does not limit admissions to a total of six months within one year.

The question asked at the liaison meeting was that if an alien is otherwise admissible as a B-2 visitor for pleasure, a CBP officer should not limit the admission of that alien to 180 days in a twelve-month period. Can this be confirmed?
CBP responded that if an alien applicant is otherwise admissible as a B-2 visitor, and passport validity requirements are met, the applicant can be issued more than one 180-day admission period in a 12-month period.

Another question asked was, assuming an individual is otherwise eligible for admission, please confirm that eligibility for admission as a visitor is determined by the nature and expected duration of the intended activity in the U.S.

CBP responded that alien applicants for admission in the B-2 classification are determined to be eligible for that classification based on the purpose of their visit to the U.S., as well as the anticipated period of stay.

It was further noted at the liaison meeting that while previous presence in the U.S. is a relevant factor in determining whether an alien maintains a residence abroad that he or she has no intention of abandoning, please confirm that inspecting CBP officers should not focus solely on the amount of time an individual has previously spent in the United States to determine eligibility for admission as a visitor.

CBP responded that all nonimmigrant applicants seeking admission as B-2 visitors are required to satisfy the inspecting CBP Officer that they are entitled to the admission and classification that they seek, including proving that they maintain a foreign residence abroad that they have no intention of abandoning. A variety of factors are to be taken into consideration by the inspecting officer, including, but not limited to, the intended length of stay, proof of foreign residence, and financial solvency.

Because there have been concerns that immigration officers are not properly trained, it was inquired at the meeting that for the San Diego CBP port of entry, please identify the procedure available to seek supervisory review of an officer’s refusal to admit a visitor due to the period of time he or she was previously present in the U.S.

In instances in which an officer refuses to admit a visitor due to the period of time he/she was previously present in the U.S., the applicant can ask to speak to the Supervisory CBP Officer who is assigned to the area in which the inspection took place. Such refusal would definitely result in a visa cancelation taking place, in which case an inquiry with the Special Cases Office could be initiated in order to have the cancellation reviewed.

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Permanent resident status based on EB-5 eligibility is available to investors, either alone or coming with their spouse and unmarried children. Eligible aliens are those who have invested — or are actively in the process of investing — the required amount of capital into a new commercial enterprise.

They must further demonstrate that this investment will benefit the United States economy and create the requisite number of full-time jobs for qualified persons within the United States.

There is an annual worldwide quota of 10,000 EB-5 immigrants. In fiscal year 2012 (ending October 31), a total of 7631 persons immigrated in this category, of which 80% were from China. According to the U.S. Citizenship and Immigration Services (USCIS), Chinese EB-5 applicant may soon be subject to a wait list. There has never been an EB-5 wait list before.

In this article, we will address the most frequently asked questions to safeguard your EB-5 application.

I. EB-5 Investment Requirements

Generally, you may be eligible for EB-5 immigrant visa if:
1. You establish a new commercial enterprise by:
(1) creating an new business;
(2) restructuring an existing business; or
(3) expanding an existing business resulting in an increase of at least 40% in the net worth of the business or in the number of the employees of the business.

Note: In 2002, Congress has eliminated the “establishment” requirement for EB-5 investors. Instead of proving that they have “established” a commercial enterprise themselves, investors now need only show that they have “invested” in a commercial enterprise.

There are two basic requirements for showing a new commercial enterprise. First, the enterprise must be “new” – i.e. formed after November 29, 1990. However, an enterprise formed before this date may qualify if an investor “restructures” or “expands” an existing business.

Second, it must be a “commercial” enterprise. Any for-profit entity formed for the ongoing conduct of lawful business may serve as a commercial enterprise.

2. You have invested, or are actively in the process of investing, in a new commercial enterprise:
(1) at least $1,000,000, or
(2) at least $500,000 where the investment is being made in a “targeted employment area,” which is an area that has experienced unemployment of at least 150 per cent of the national average rate or a rural area as designated by OMB; and
Note: To qualify, an investor must maintain more than a purely passive role in the new enterprise upon which the petition is based. The petitioner must be either involved in the day-to-day managerial control of the commercial enterprise, or manage it though policy formulation.

The term “invest” means to contribute capital. A contribution of capital in exchange for a note, bond, convertible debt, obligation, or any other debt arrangement between the entrepreneur and the new commercial enterprise does not constitute a contribution of capital and will not constitute an investment. Capital must be obtained though lawful means.

3. Your engagement in a new commercial enterprise will benefit the United States economy:
(1) create full-time employment for at least 10 U.S. citizens, lawful permanent resident, or other immigrants lawfully authorized to be employed in the United States; or
(2) maintain the number of existing employees at no less than the pre-investment level for a period of at least two years, where the capital investment is being made in a “troubled business,” which is a business that has been in existence for at least two years and that has lost 20 percent of its net worth over the past 12 to 24 months.

Note: Neither the investor nor the investor’s spouse and children count toward the 10-employee minimum. Nonimmigrants also are excluded from the count. The definition also excludes independent contractors.

The jobs created must be full-time, meaning employment of a qualified employee in a position that requires a minimum 35 working hours per week. Job-sharing arrangements, where two or more qualifying employees share a full-time position will also serve as a full-time employment, if the hourly requirement per week is met.

II. EB-5 Investment Options

Three types of enterprise entities commonly associated with EB-5 petitions:

1. Corporations
Corporations are the most familiar business structure. A corporation exists as a separate legal entity. This means that when an individual incorporates his/her business in a particular state, the corporation is responsible for its actions, including taxes and debt. Typically under this structure, corporate officers and shareholders cannot be held personally liable for the actions of the corporation.

Additionally, ownership of corporate stock may be freely transferred by sale or by gift, subject to certain corporate restrictions. An incorporated business may buy, sell, and hold property under the corporation name and enjoy unlimited life, meaning the business remains unaffected by the death of a director, officer, or shareholder. However, some types of corporations are subject to “double taxation.” This means that profit is first taxed at the corporate level and then again at the personal level.

2. Limited Liability Companies

A limited liability company (LLC) exists as a separate legal entity. This structure combines some of the limited liability advantages of a corporation with the tax-related benefits of avoiding double taxation associated with a partnership. One of the major advantages of an LLC is that the business can choose how it would like to be taxed—as a corporation or partnership. Additionally, there is no limit to the number of shareholders that can exist in a LLC structure. A LLC can be managed either through “member management,” in which all members of the LLC have a say, or through “manager management,” in which members appoint a manager to operate and direct the business. Many states have implemented “franchise taxes” for LLCs which serve as fees to the company for the limited liability and flexibility they enjoy.

3. Limited Partnership
A limited partnership occurs when two or more individuals join together to form a business by contributing capital, property, labor or skills in exchange for part of the profit or losses of a business. In a limited partnership, there is usually only one general partner and one or more limited partners with limited duties and liabilities. In this structure, the general partner(s) have full management responsibilities and control daily business functions. The limited partner is typically a passive investor. Limited partnerships enjoy the tax benefit of avoiding double taxation on their profit. However, partners are personally liable and not all partners share liability equally. Examples of limited partnerships include large law firms.

III. EB-5 Visa Process

1. Filing for Immigrant Petition
Investors should first file Form I-526, accompanied by all supporting documentations with the USCIS California Service Center. Form I-526 is equivalent to the I-140 in that after approval, one still needs to adjust status through an I-485 if he or she is in the U.S., or through consular processing if he or she is outside of the U.S. The required documentation must show that the immigrant investor has invested or is investing the required lawfully-gained capital in a company within the U.S., and that the investor will create full-time jobs for at least 10 U.S. workers.

Specifically, first, an investor must show that an investment has been made in a qualified commercial enterprise. Evidence may include but not limit to: 1) an organizational document for the new enterprise, including articles of incorporation, certificates of merger and consolidation, or partnership agreements; 2) a business license or authorization to transact business in a state or city, if applicable; and 3) for investment in an existing business, proof that the required amount capital was transferred to the business and the investment has increased the net worth or number of employees by 40% or more.

Second, the investor must prove that the required amount of capital “at risk” has been placed. A mere intention to invest will not satisfy the “actively in the process of investing” requirement. Evidence may include: 1) bank statements showing deposits in the U.S. account of the enterprise; 2) evidence of assets purchased for use in the enterprise; 3) evidence of property transferred from abroad; 4) evidence of funds invested in the enterprise in exchange for stock; 5) evidence of debts secured by the investor’s assets and for which the investor is personally and primarily liable.

Third, the regulation s require filing the following types of documentation to establish that the capital used in the new enterprise was acquired by legitimate means: 1) foreign business registration records; 2) personal and business tax returns, or other tax returns of any kind field anywhere in the world within the past five years; 3) documents identifying any other source of money; or 4) certified copies of all pending governmental civil or criminal actions and proceedings, or any private civil actions involving money judgments against the investor within the past 15 years.

Fourth, the investor needs to show that a new commercial enterprise will create at least 10 full-time positions for qualified employees. Petitioner should provide copies of relevant tax records, Form I-9 or similar documents, and a comprehensive business plan.

Fifth, the petitioner must be involved in the management of a new commercial enterprise, by providing documentations including comprehensive job description for the position occupied by the investor, certificate that the investor is a corporate officer or on the board of directors, or any other documents showing that the investor is involved in direct management activities or policymaking activities.

The filing fee for Form I-526 is $1,500. Current processing time for I-526 is four to six months.

2. Filing for Change of Status Petition
Once an investor has received I-526 approval, he or she can receive Conditional Permanent Residence by filing Form I-485.

If You Are residing Outside the United States

You can become a permanent resident through consular processing if you live outside the United States. Consular processing is when USCIS works with the Department of State to issue a visa on an approved Form I-526, Immigrant Petition by Alien Entrepreneur Petition when a visa is available. Processing time is between 6 months to 1 year.

If You Are residing in the United States

You can become a conditional permanent resident through change of status if you live inside the United States. Once Form I-526 is approved and a visa number is available, you can apply for conditional permanent residence using Form I-485, Application to Register Permanent Residence or Adjust Status.

Upon approval of the Form I-485 or admission on an EB-5 immigrant visa, the investor and his/her derivative family members are granted two-years of “conditional” permanent resident status. Children must be unmarried and under the age of 21 to be considered derivatives at the time the I-526 is filed.

3. Filing for Removal of Conditional Residency
Within 90 days of the 2-year conditional green card’s expiration date, the investor must file Form I-829, to request removal of conditional permanent residency. The petition will be granted if the investor has fulfilled the EB-5 requirements in accordance with the business plan in the approved Form I-526 petition. Failure to file Form I-829 will result in automatic termination of the conditional resident’s status and will initiate deportation proceedings.

Immigrant investors remain in “valid” status while their I-829 petition is pending. Their status is supposed to be extended automatically in one year increments until USCIS acts on the petition. During that time, investors are authorized to travel.

Once conditions have been removed, a full green card is granted for indefinite permanent resident status in the United States. After five years of permanent residency (including the two conditional years), an investor may apply for U.S. citizenship.

If you need assistance with you EB-5 Visa, be sure to email us with your case request.

See Chinese Version below:
EB-5 投资移民律师：EB-5 投资移民申请指南

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Many of our Blog visitors are often asking about the EB5 program, How can I apply? How much does it cost, How Fast?. In this post let us look at the basics of this program. This is in part from a study by the Carlson Consulting Enterprise from Minnesota.

The EB-5 program places two requirements on foreign investors seeking a green card: first, they must invest $1,000,000 in an approved project of their choice, and second, ten new full-time jobs must be created as a direct result of that investment. The investment must be either in a new business (defined by the USCIS as ―a commercial enterprise established after November 29, 1990‖) or in one which has been purchased and restructured such that a new commercial enterprise has resulted, or the investment will spur either a 40% increase in net worth or employees.

Prior to 1992, these restrictions meant that foreign investors either had to create their own new business or find a budding business in which to invest at its earliest stages. In 1992, Congress established a pilot program, which has been regularly reauthorized but has not yet been made permanent, which allows for the creation of economic entities called Regional Centers to assist in the investment process.

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The head of a now out-of-business Los Angeles law firm was sentenced Thursday to 10 months in prison for his role in orchestrating a lengthy employment visa fraud scheme where the illicit profits were used to purchase several hundred thousand dollars’ worth of vacant cemetery plots and grave monuments.

Joseph Wai-Man Wu, 53, former president of the East West Law Group, pleaded guilty in August 2011 to one count of conspiracy to commit visa fraud, one count of money laundering and one count of obstruction of justice. As part of a plea agreement reached in February, Wu surrendered a portion of his profits derived from the visa fraud scheme, forfeiting to the government 30 vacant cemetery plots and 20 grave monuments, all of which were purchased with proceeds from the scam. Wu used the cemetery plot purchasing scheme to launder some of the money he unlawfully obtained through the visa fraud scheme. The grave plots will now be sold at public auction and the proceeds given to the U.S. Treasury.

Wu’s sentencing is the latest development in a 2 ½-year investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) that also involved the U.S. Department of Labor’s Office of the Inspector General, and U.S. Citizenship and Immigration Services’ (USCIS) Fraud Detection and National Security Unit.

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The North American Free Trade Agreement (NAFTA) Professional (TN) visa allows citizens of Canada and Mexico to seek temporary entry into the United States to engage in business activities at a professional level, such as Accountant, Economist, Computer Systems Analyst, Engineer, etc.

Only Canadian and Mexican citizens who are professionals can apply for a TN Visa to work in the United States. The visa lasts up to a maximum of three years which is consistent with other non-immigrant worker categories, such as H1-B. However, the TN process is usually quick if qualify and there are no limits on how many of these visas are issued each year.

In order to obtain the TN status, beneficiaries must have an offer from a U.S. company or a client that is a U.S. company. Also, they need to ensure that they have the necessary qualifications that meet the requirements of the visa, according to the list of “NAFTA Professional Job Series List”.

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In a recent case from the Board of Immigration Appeals (BIA), the BIA has held that where an alien fails to appear for a hearing because he has departed the United States, termination of the pending proceedings is not appropriate if the alien received proper notice of the hearing and is removable as charged.

The alien departed the U.S. to Mexico once removal proceedings were instituted against him. His attorney filed a motion with the court to terminate the proceedings, since he left the country. The Department of Homeland Security (DHS) objected to the motion and wanted to proceed in absentia (in absent) of the alien. The immigration judge sided with the alien and the case was terminated. DHS appealed this decision, wherein the BIA sided with DHS and concluded that it was an error to terminate the proceedings.

The BIA reasoned that under the Immigration and Nationality Act (INA), an alien does not need to be physically in the United States for the Immigration Judge to retain jurisdiction over pending proceedings and to conduct an in absentia hearing. In fact, the purpose of in absentia proceedings is to determine whether the DHS can meet its burden to establish that the alien, who did not appear, received proper notice and is removable as charged. If the DHS meets its burden, the Immigration Judge should issue an order of removal; if it cannot, the Immigration Judge should terminate proceedings.

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We are happy to share USCIS performance data containing statistical information on immigrant petitions by alien entrepreneur and petitions by entrepreneur to remove conditions. The number of cases received, approved and denied for through the fourth quarter of FY2012. These petitions are filed under the fifth employment-based preference category (EB-5) for foreign investors.

It is interesting to note that the number of I-526 applications (for initial EB-5 green card) have more than doubled compared to 2011 (6041 compared to 3805) while the approval rate has dropped at 79%. The rate of I-829 filings (application to remove condition) have dropped off at 712. The approval rate for I-829 has dropped at around 92%.

We can some sort of a slowdown in the EB5 filings, but we hope that with the current elections results, more confident investors will start with more EB5 cases in 2013.

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The division of red states and blue states once again surfaced in an American presidential election. But so did an American tradition of giving a guy who has done a good job under difficult circumstances another term in office.

Moreover, Americans endorsed President Obama’s overall approach to restoring the American economy for the middle class and continuing with a national guarantee of reforming our Broken Immigration System. The general feeling is good, our clients are optimistic and excited and we see that from our Facebook page comments as well as my email inbox.

See Below a statement from AILA:

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A daylong summit on Nov. 10 will teach immigrant entrepreneurs how to overcome obstacles in business. Individuals like Betty Garcia embraces the term “immigrant entrepreneur” as a badge of pride. She says her family hasn’t had it as easy as native-born Americans in turning Tortilleria Sonora, whose name hints at both the product and her family’s origins, into a successful business. “It’s important to recognize backgrounds,” said Garcia, 37, who has helped her Mexican parents run the Des Moines shop for the last four years. “Not to put any other culture down, but Americans have it easier because they are more knowledgeable about the system and have grown up with more tools and resources.” Garcia’s family will receive the Outstanding Immigrant Business Award at the fifth annual Immigrant Entrepreneurs Summit for their successes.

As the summit celebrates success, experts say cultural differences and the law combine to make it difficult for immigrants to create successful businesses. They say lack of credit impedes access to capital. A cultural divide can discourage entrepreneurs from expanding their businesses and reaching out to wider communities. And, because of immigration law, immigrants educated in the U.S. often must return home to start a business.

Stalled legislation in Congress and programs popping up in Iowa and other places aim to help solve those issues.

Immigrants struggle with startup capital

Access to capital remains one of the biggest obstacles all entrepreneurs face. In the wake of the recession, some banks tightened the number of small business loans they handed out. But for immigrant entrepreneurs, that task is made even more difficult by the fact they don’t have any credit and can sometimes get confused by the forms they must fill out.

“For new immigrant businesses, it’s absolutely impossible to get a loan from a bank,” said Ying Sa, chairwoman of the Immigration Entrepreneurs Summit and one of its co-creators. “Immigrant entrepreneurs, typically, don’t have that luxury. They have to start differently.”
Sa said many rely on their community or themselves to get their business off and running, financially. The summit Saturday will include 15 seminars for entrepreneurs that will cover topics like business and legal risks, as well as insurance education and how to access capital.

The summit created a 12-person committee that chose award winners after sifting through nominations submitted by the community. Sa said the goal was not to single out immigrants. Instead, she said, the summit will help immigrant entrepreneurs.

“We are trying to say that business is a universal language,” she said. “We are all doing business in America, so we want to be respectful of the laws and regulations here. We want all participants to realize their American dream in a way they can feel proud.”
Startup Visa Act could open doors

When Steve Case addressed a Thinc Iowa crowd in Des Moines last month, he promoted legislation that would, essentially, “staple a green card” to diplomas and degrees to keep high-skilled immigrants in the U.S. to start businesses.

He said the Startup Visa Act would not only make it easy for immigrants to stay. The law would also tell them, “We have invested in you by giving you this great education. We need you to … serve and contribute by starting a company or joining a company” in the U.S.

The remarks brought a round of applause from the crowd at the technology and entrepreneurship conference. Under current law, immigrants on a student visa must work for others for several years before attaining residence and being allowed to start their own companies. Or, if they do start a company, they cannot work for the company.

The Startup Visa Act would amend U.S. immigration law to create a new visa category that allows foreign entrepreneurs that meet certain qualifications, including raising money from U.S. investors, to remain in the country. The most recent version of the Senate bill, along with its House counterpart, remains stalled in committee.

Critics say the new law could be ripe for abuse, with U.S. Rep. Lamar Smith, a Texas Republican, last year raising the possibility of immigrants creating a “scheme” business just to receive a visa.

White House officials, meanwhile, have maintained that they would support the act only as part of more comprehensive immigration reform.

Congress is not short on ideas regarding immigrant entrepreneurs, including Smith’s own STEM Jobs Act. But coming to a consensus has been a problem.

Vivek Wadhwa, author of “Immigrant Exodus: Why America is Losing the Global Race to Capture Entrepreneurial Talent,” said current law keeps good entrepreneurs from starting a business in the U.S.

“This is a no-brainer,” Wadhwa said of passing the Startup Visa Act. “It’s held up because our politicians are acting like spoiled teenagers. If one side puts forward a bill, the other side opposes it because they have to.”
Wadhwa, who recently co-authored a study published by the Kauffman Foundation on high tech entrepreneurship, says passing the Startup Visa Act could be the impetus the country needs to help the struggling economy recover.

“Within a year of that bill passing, there would be tens of thousands of new startups created,” he said. “It’s a bill that needs to be passed. What could be more sensible?”
Lawyer says current law is prohibitive
As the law stands now, immigrants have options to consider when starting a business, although many depend upon their country of origin.

The EB5 immigrant investor visa program requires heavy foreign investment in an idea or business, sometimes as much as $1 million, before an entrepreneur can start a business. In addition, the business must create at least 10 U.S. jobs.

The U.S. also has treaties with about 50 countries that allow foreign-born entrepreneurs to remain in the country as they build their business. However, Lori Chesser, an immigration law expert with Des Moines’ DavisBrown Law Firm, said those countries do not include two of the most prominent sources of immigrants, China and India.

Chesser often receives questions from people interested in building a business — and creating jobs — in the U.S.

“Many times, there is no way to convert their idea into a productive business in the U.S.,” said Chesser, who will attend the summit as a speaker. “Sometimes, their faces fall. They are looking for that magic bullet. But it’s not there.” Chesser said a better system must be developed, one that could include the Startup Visa Act, which she said is “better than nothing.”
“It’s frustrating for those of us who see the drive and the energy behind the people coming who want to start their business and want to make a contribution here,” she said. “To see us have to turn them away or channel them and divert their talents into other jobs just for a green card, and delaying their entrepreneurship for years, it’s just a frustrating thing to deal with on a daily basis.”

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