MUMBAI: Families, especially those whose children are studying in the US, are increasingly making inquiries about EB-5 visas – also known as investor visas. As the H-1B work visas are getting difficult to come by for entry-level jobs, usually for freshly qualified individuals, investor visas have shot into the limelight.
For those keen on applying for EB-5, a move by the US government that has extended the due date for investments via regional centres – a significantly more popular mode of investment for obtaining the EB-5 visa – by a little over two months, from September 30 to December 8, has come to their aid. This is the second such extension in 2017, as the earlier expiry date of April 28 had been extended to September 30.
“President Trump has signed into law – ‘HR 601’ – which is a continuing resolution for funding the federal government till December 8. This has extended the EB-5 regional centre program beyond the expiry date of September 30,” says Rajiv S Khanna, managing attorney, Immigration.com.
Even as an EB-5 reform bill is on the anvil, which could increase the level of investments required and possibly include other strictures, Khanna adds, “Under the US Constitution, the government cannot make laws that change vested rights retroactively. Therefore, if you have already invested and filed your EB-5 papers, I don’t see why you need to worry about subsequent changes in the law.”
There appears to be a strong correlation between the challenges posed in obtaining an H-1B and the renewed interest in this investor visa. TOI had reported earlier on an increase in inquiries for H-1B applications where salaries are at the entry level. It had also reported that graduates from IITs who were offered US-based jobs last year are facing work visa challenges.
According to the 2016 report by Open Doors, a research agency, there are nearly 1.66 lakh students in the US who make up 15.9 per cent of the total international student population. If a family can afford an EB-5, it enables the student to work in the US without facing H-1B related hurdles.
Immigration experts and firms that specialize in immigration-linked investments have been seeing a sudden spate of inquiries after the extension of the deadline. Jeffrey DeCicco, CEO and chief compliance officer, CanAm Investor Services, says, “The current wait time and proposed new restrictions on H-1B visas have already spurred a significant demand for EB-5 from India and this trend is likely to continue. Families with means to enter the program increasingly see EB-5 as a way to cut as many as 10 years off the waiting time to get a green card and also as a way to allow their children to work freely in US without the need for a corporate sponsor.”
Those opting for the EB-5 need to invest $1 million (around Rs 6.5 crore) in new commercial projects or half a million (nearly Rs 3.25 crore) for operations in specified rural areas or regions with higher unemployment known as targeted employment areas— the objective being to create at least 10 permanent full-time jobs for US workers.
EB-5 offers two routes of investments. One, where the investor directly sets up his own business. The other, via investment in recognized regional centres, which, in turn, sponsor business entities. The latter is a more popular investment route. Of the 90 EB-5 visas issued to Indians between October 1, 2015, till September 30, 2016, 76 were for investments via regional centres. While figures of such visas granted to Indians are still in two digits, it is a sharp rise from just five such visas issued in 2005 (see table). Investors are granted a “conditional” permanent residence for themselves, spouse and children below the age of 21. After two years, they have to apply for lifting of the “conditions”. If approved, they and their family can permanently live and work in the USA.
According to industry estimates, since 2008, over $18.4 billion has been injected via the EB-5. Official country-wise breakup is not available, though.”EB-5 investors need to do significant due diligence of the borrower, the project, and the regional centre. One of the main requirements of the EB-5 program is that the investor’s money must be ‘at risk’ during the investment period. Any regional center that offers or implies a guarantee of any sort should immediately be removed from consideration.