Buy American, Hire American: The Future of U.S. Investment Immigration

By Yohan A. Zingile & Dr Martins I. Imudia

Posted: 26th April 2018 08:26

Since the implementation of the Investors Visa Program, the United States continues to encourage the flow of major investments to help stimulate the economy through job creation. In exchange for the investments made, the United States offers its foreign investors a variety of immigrant and nonimmigrant visa options. This trend has somewhat changed under the Present Trump Administration of buy American, hire American (BAHA).
 
Is it enough to buy property in the United States to obtain investors visa?
 
Generally, the answer is no. However, if the investment in property such as house(s) or other form of real estate is substantial enough, leading to sustainable job creation, investors’ visa may be obtained. This remains the same under the Trump administration, unlike what is obtainable in the United Kingdom and other countries. Thus, the EB-5 regional centre approach (with mainly large real estate projects) remains a viable option though fraught with fraud.
 
Is Chinese Retrogression a factor?
 
Yes. With Chinese retrogression, investors from mainland China are now exploring other ways for obtaining legal residency such as the EB-1C or L-1 visa. Although the foreign investor needs not meet any monetary investment requirements. However, unlike the EB-5, an L-1 visa does not grant its holder permanent residency immediately. Over the course of some years however, the L-1 visa holder may apply for EB-1C visa to obtain an immigrant visa so long as jobs are created based on a sustainable substantial investment. The future trend supports L-1 visa under BAHA contrary to the past when briefcase entities obtained visas for foreign nationals without credible job creation.
  
How do I avoid Investors’ Immigration Scam under the EB-5 program?
 
EB-5 investors can invest in a regional centre or in individual projects (direct investment) so long as the job creation and minimum investment threshold requirements are met. However, investors must beware of entities or individuals who promote projects. Some have collected monies from investors and disappeared into thin air. As immigration attorneys, we do help investors screen projects and guide them based on available information. With over 600 regional centrespromoting EB-5 projects, it is difficult for the innocent investor to know which one is viable or not viable. Also, of great importance is the structuring and handling of escrow accounts, where the investment funds cannot be released to any human or business entity until the initial application for a green card is approved. This prevents fraudulent project managers from defrauding innocent investors. Whenever project promoters promise too much, it is probably wise to reflect, step back, and think twice before investing.
 
Furthermore, the EB-5 process is heavily regulated by the U.S. Securities and Exchange Commission (SEC) and it is complex. The complexity of the U.S. immigration law is further exhibited in the number of agencies involved in the process, including the Department of State, the Department of Homeland Security, the Department of Labor, and the Department of Justice, among others. Decision on steps for obtaining investors’ visa (whether L-1, EB-1C or EB-5)requires careful review of the investor’s immigration goals and financial resources. It is best to consult with a qualified immigration attorney if you are seeking to enter the United States as an investor. With deregulation under the current administration, investors need to move with utmost caution even when it is promising.
 
Am I eligible for Entrepreneur Parole?
 
The International Entrepreneur Parole Rule provides a new avenue for foreign nationals desiring to come to the U.S. through investment. This option is available for foreign national entrepreneurs of start-up who possesses at least 10% ownership interest in the entity, have an active and central role in its operation and future growth, and received an investment capital from qualified U.S. investors of at least $250,000 or more, or received significant monetary awards from government entities of at least $100,000 or more.
 
While it does not provide direct path to legal permanent residence, with lower funding and job creation requirements compared to the EB-5 investment, the International Entrepreneur regulation increases the pool of investors eligible to enter the U.S. The general emphasis being that the investment constitutes a benefit to the nation’s economy. The interesting thing about this option is that those in the United States who are inadmissible and not eligible for other visas due to overstays or entry without inspection may use this as a pathway to reinstate their stay legally in the country. With the BAHA tough approach on temporary protected status (TPS) and deferred action for childhood arrivals (DACA), this is becoming an alternative option for those who have good skills and access to U.S. qualified investors.
 
Is Franchise an Option?
 
Foreign investors wishing to establish a new business in the United States may decide to obtain a U.S. franchise. This will give them the privilege of using popular a U.S. brand to market goods or services of a third-party franchisor.
 
This option is beneficial for E-2 visa investor visa, or even EB-5 investment, for several reasons. First, there exist numerous successful franchises among different industry in the United States. Foreign investors may choose among known franchise brands that are already established in the United States and consequently more likely to be a successful investment. Additionally, immigration officers will be more familiar with the franchise business since there exist a track records for the brand; they will be better able to understand the business model and evaluate or appreciate the likelihood of success of the investment. Moreover, foreign investors who are not business-oriented or who do not have the experience or background demonstrating their capacity to operate a new business may benefit from the training and support system provided by the franchisor. However, the international franchisor may also extend its brand to the United States.
 
Under the current administration of BAHA, the franchise model is an attractive option. However, because job creation and investment threshold affect what visa may be obtained, it is very important to work with an experienced investment immigration attorney in picking a franchise to ensure that the investors’ immigration goals are met.
               
In sum, the future of U.S. immigration looks good for investors under BAHA. While investors ultimately obtain immigrant visas for themselves and their family members (spouse and unmarried children under 21), many investors have used the U.S. investment platform to incubate innovative businesses and transfer technology and resources when needed to their home countries. While most investments are traditional ventures, such as hotels and construction, some innovative areas give investors a competitive advantage in emerging markets, such as hydroponics in agriculture, chemical development and human resources for the oil and gas industry, and the specialised manufacturing sector. The franchise option remains very attractive. With the start of international entrepreneur parole, a new category of investment and work permit is created for those who will otherwise not qualify.
 
Since the United States is the most desired education destination, by obtaining investors visa before children reach the university level, they can take advantage of lower university fees. Upon graduation from university, beneficiaries may remain in the United States to gain work experience, an option that is more difficult to obtain in Britain and other western countries. Whether this trend will continue is debateable under BAHA.
 
Yohan A. Zingile*– Attorney at Law and Business Clients’ Relationship Officer, and
Dr Martins I. Imudia*(Lead Counsel and author, The Investors’ Guide to U.S. Immigration Law)
*Counsels at the Center for U.S. Immigration Services (CFUIS), Tampa, Florida
 
CFUIS is a Private Immigration Law Firm. CFUIS has more than 35 years of combines experience with excellent record representing investors, individuals and businesses who wish to obtain a United States visa to conduct business, manage their investments, or work for a United States branch or subsidiary. The firm handles corporate and international investors clients to ensure that not only the initial visa is approved, but also to maximise the chances of approval for future renewals. CFUIS also helps with employers’ compliance assistance for businesses.

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