U. S. Immigration Benefits For Foreign Investors

   U. S. Immigration Benefits For Foreign Investors

The Magna Carta that King John of England signed in 1215 at Runnymeade under duress mandated that foreign merchants be allowed to travel throughout the kingdom and that they be exempt from the payment of “evil tolls.”[1] And in 1924 the United States Congress authorized the issuance of visas to foreign nationals who wished to come to this country to engage in trade provided that their home country had a treaty with the US that allowed American citizens the same right in their nation.[2]  Such treaties have become known as ‘friendship treaties”.  And since that time the national legislature has seen fit to create different categories of non citizens who are permitted to come to the US for the purpose.

There are currently two classes of nonimmigrant visas that a foreign citizen who wishes to enter the US to invest in businesses here can utilize. The category known as “E-1” allows admission to a foreign national who will engage in “substantial trade” between the US and his or her host country.[3]  An “E-2” visa holder is required to develop and operate a business venture in which he or she has invested a “substantial amount of capital.”[4]  The terms “substantial trade” and “substantial amount of capital” are not defined in the relevant law. Both categories require that the visa holders be citizens of nations that have friendship treaties with the US.[5]  A list of those countries is in place at the US State Department’s website. The majority of holders of those visas are citizens of European and Asian nations since nations in those two areas constitute the majority of states that have friendship treaties with the US. There are several subcategories of those visas, but they all have certain requirements that include the recipient of the visa must be in an executive or supervisor role in the company that he or she his investing in, he or she must have skills that are necessary for the operation of the business in question, or the skills he or she possesses must be essential to the businesses successful operation. There is no test set forth in determining if an applicants skills qualify for that designation, and it is determined on a case by case basis.[6]  In addition, he or she must show an intent to depart the US. when their nonimmigrant visa expires. A holder of an E class visa can normally remain in the United States for a two year period, and can apply for extensions of the visa provided he or she still meets the criteria for the visa.[7]

The Immigration and Nationality Act (“INA”) that was originally passed by the US Congress in 1952 was amended in 1990 to allow foreign investors to immigrate to the US and become what is known as “lawful Permanent Resident”(“LPR”).[8]  That enactment is codified in Section 203 (b) (5) of the INA and this category is known as “EB-5". The individual in question must be coming to this nation to develop a new commercial venture that will employ at least ten U.S. citizens, or legal permanent residents.[9]  The employees can not be the foreign nationals spouse or children.[10]  The measure was said to have been  inspired by a series of laws passed by the Canadian Parliament that had been enacted in a successful effort to entice business people in the British Crown Colony of Hong Kong to emigrate to Canada before that Colony became part of the Peoples Republic of China in 1997.

The investor must invest at least $ 1 million into the venture, unless the site of the business is in a “targeted area” where the investment only has to be $500,000.[11]  A “targeted area” is defined in the statutes as either rural areas or areas that have an unemployment rate of at least 150 % of the national average.[12]  A rural area is described as one that is not located within a metropolitan statistical area or the outer boundary of a city or town with a population of 20,000 or more.[13]  The businesses must be in operation for at least two years and the jobs created must be in place for that time period as well.[14]

The regulations that were implemented in accordance with that section mandate that the business being formed does not have to be financed by a single applicant.[15]  Several foreign investors can jointly fund the undertaking to achieve the required investment and job creation. And to qualify for admission into the US under the Section each individual applicant will have to be engaged in the daily operations of the business.[16]

In 1992 Congress established the “Immigrant Investor Pilot Program” to encourage foreign investment in what was designated “ regional centers” that are in need of economic development.[17]  It was somewhat different than the LPR investment visa  Congressional enactments.  That program allows foreign investors who wish to immigrate to the US to obtain lawful permanent resident status by investing capital in ventures located in those areas.[18]  The minimum amount of capital that has to be invested is $500,000.

   Endnotes