EB-5 Program Stands to Benefit
by Adam Longenbach
On February 11, 2014, the Canadian government released a statement announcing its intention to terminate both their Federal Immigrant Investor Program (IIP) and Federal Entrepreneur Program (EP). The IIP and EP have been the anchors of Canada’s business-oriented immigration programs. As recently as 2011, the programs combined to provide a path for the entrance of nearly 11,000 immigrants into Canada. However, the EP had been put on hold in July 2011 and the IIP suffered the same fate in July 2012. Tuesday’s announcement provided some finality for both programs.
In recent years, both programs have been experiencing significant backlogs of applications. Investors were waiting at least 54 months for processing and many entrepreneurs faced even longer processing times. Citizenship Immigration Canada (CIC) has stated that it anticipates the current backlog of applications could have taken up to six years to process. In an effort to move forward with programs that will focus on attracting experienced business people and raising investment funds that will provide the maximum benefit to Canada, CIC has decided to eliminate the backlogged files. As a result of this decision, as many as 59,000 IIP applications will be returned, as well as 7,000 EP applications.
In their place, the government will be implementing two new pilot programs focused on attracting immigrants who will deliver meaningful benefits to the Canadian economy. One will be a new Immigrant Investor Venture Capital Fund, and the other a new Business Skills Program. As of now, details of these new programs are scarce, but CIC has stated that the new pilot programs will complement the Entrepreneur Start-Up Visa program.
Investors who had applied to the IIP or the EP and will now have their applications returned, and those who were contemplating applying, may now be searching for other investment opportunities. Luckily, interested investors will not have to look very far. The U.S. EB-5 program may present an interesting investment opportunity.
The EB-5 program enables foreign investors, their spouses, and unmarried children under the age of 21 to immigrate to the United States and, if they successfully complete the EB-5 visa program, to become lawful permanent residents of the United States. In order to get an EB-5 visa, foreign investors must meet several requirements to qualify. First, they must make the required capital investment ($500,000 or $1,000,000 depending on the location of the business receiving the funds) in an approved business entity or EB-5 regional centers in the United States. Second, this investment must lead to the creation of 10 full time jobs in the United States for a two year period.