+1-800-997-1228
Questions & Answers

What is the difference between the L-1 and EB-5 programs?

I am a business partner in a family-owned business in the United Arab Emirates (UAE) and would like to open a branch of this same company in the United States. Which program would be better suited for this type of venture: L-1 or EB-5 program? My end goal would be to gain U.S. citizenship while still opening and operating this new branch.

Answers

  • Avatar

    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    The main difference is that the L-1 is a nonimmigrant visa category, while the EB-5 is an employment-based immigrant category. The L-1A is for managers or executives who are transferred from a company abroad to a U.S. company with a qualifying relationship (parent, branch, subsidiary, affiliate). The EB-5 immigrant category is for alien entrepreneurs who make qualifying U.S. investments that create employment in the United States. The L-1A does not qualify you for U.S. citizenship but another immigrant category called EB-1C might if the company meets all of the requirements. If your end goal is to become a U.S. citizen, you must first become a permanent resident and meet the five years of continuous residence requirement, the physical presence requirement and other requirements for naturalization. To make the right decision for your specific situation, you should talk to an experienced immigration attorney.

  • Avatar

    Julia Roussinova

    Immigration Attorney
    Answered on

    In general terms, the L-1 visa is a nonimmigrant visa allowing your foreign-based entity to open a new office in the U.S. and transfer a multinational executive or manager (L-1A visa holder) to its office in the U.S. An L-1A visa eventually leads to a permanent green card in the U.S. However, an I-140 petition is required to be approved first. If the I-140 petition is approved, then you are eligible to apply for a permanent green card in the U.S. (if physically in the U.S. in an underlying L-1A status at the time of I-140 approval) or consular process and receive an immigrant visa to be admitted as a green card holder (if abroad). Then, in 4 years and 9 months after the initial grant of your green card, you may apply for U.S. citizenship if all other criteria are met. The EB-5 visa is an immigrant visa that directly leads to a conditional (2-year) green card in the U.S. and then you must apply for removal of conditions to obtain a permanent green card in the U.S. within 90 days of the expiration of your 2-year green card. You may then apply for U.S. citizenship in the same manner as above. Your EB-5 investment must come from a lawful source of funds. An underlying EB-5 business (new commercial enterprise) must also directly create the minimum of 10 full-time (at least 35 hours/week) positions for qualifying employees in the U.S. Requirements are different for each type of visa and you should consult an experienced immigration attorney for a more in-depth discussion of your specific situation and what type of visa may be best suited for you.

  • Avatar

    Barbara Suri

    Immigration Attorney
    Answered on

    The L-1 visa is issued to an Intracompany Transferee. It facilitates the temporary transfer of a foreign worker in the executive, managerial or specialized knowledge category, to the U.S. to continue employment with an office of the same employer, but an affiliate, branch, parent or subsidiary. The EB-5 Immigrant Investor program was created by Congress in 1990 to stimulate the United States economy through job creation and capital investment by foreign investors.

  • Avatar

    Mitch Wexler

    Immigration Attorney
    Answered on

    It depends on your time horizon. If you would like to be in the U.S. launching the business soon, the L-1 would be a good option as that can happen within a few months. To apply for U.S. citizenship, you will need a green card for 5 years. You can also immediately pursue a green card application in the EB-5 category if the U.S. enterprise qualifies. It will likely take about 2 years to get conditional residency. Alternatively, after a year of operation for the U.S. enterprise, if the enterprise qualifies, you can apply for a green card in the EB-1C category. That is currently taking about 1-1.5 years but that green card is "unconditional" which is an added benefit. You can do both as well. There are strategic decisions to be made here and it is advisable to ask competent counsel how to proceed.

  • Avatar

    Jinhee Wilde

    Immigration Attorney
    Answered on

    L-1 visa is a non-immigrant visa, which you should be able to get if you set up an affiliate or subsidiary of your UAE based company. This path will not directly grant permanent residency (green card) without pursuing another path to permanent residency, such as EB-1C or even EB-5. EB-5 is an immigrant visa category, for which you will get a conditional green card for an investment minimum of $500,000 if the business is in a TEA or otherwise $1 million. Depending on how much your investment may be to establish the U.S. subsidiary, you may wish to structure the business in such a way that could become an EB-5 investment after obtaining the L-1. You should work with a corporate attorney who knows how to structure the EB-5 business as well as an immigration attorney with significant EB-5 experience to accomplish your goal in a two-step process.

  • Avatar

    Dale Schwartz

    Immigration Attorney
    Answered on

    If you qualify for the L-1 visa, it can lead to a green card and ultimately citizenship much faster and less expensively than the EB-5 category. But, to qualify, you must have a substantial business outside the USA for one full year (out of the last 3 years) and have been an executive and manager. It is hard to get L-1 cases approved if the foreign company has less than 7-10 employees. In the US company, he will also have to be an executive and/or manager and the US company should project having at least 6-10 employees by the end of its first year of operations. Once the US company has one full year of business operations, it can sponsor the executive/manager for a green card. The initial L-1 will usually be approved for 1 year and can be renewed for up to 7 years (or until the green card is obtained). It only takes a few months to obtain a decision on an L-1 case. The EB-5 visa is great if the person is investing $1,000,000 anywhere in the USA (or $500,000 in a rural area or high-unemployment area) and will hire 10 US employees. Currently, USCIS is taking nearly 24 months to decide EB-5 cases.

  • Avatar

    Lynne Feldman

    Immigration Attorney
    Answered on

    There are several differences. The L-1 is an intracompany transferee nonimmigrant status and the EB-5 is a program leading to a green card. The L-1A can lead to a green card after a year so if both companies are solid this is an easier, faster and less expensive route to permanent residency and then U.S. citizenship. Further, there is no interim 2-year green card as there is with the EB-5 program. Set up a consultation to discuss the specifics of your case.

  • Avatar

    Charles Foster

    Immigration Attorney
    Answered on

    There are significant differences between the L-1 and the EB-5 program. The L-1 program is a non-immigrant program that would give one the right to work temporarily in the U.S. as an Intra-Company Transferee. It may ultimately lead to Permanent Residency. If you can open a branch or subsidiary in the United States and transfer from your UAE company in a managerial or executive position to a managerial or executive position in the United States, you could qualify initially for a 1-year, New Office L-1 Intracompany Transferee visa. After 1 year, you would extend same for an additional 2 years and continue to extend same 2 years at a time for a total of 6 years allowing you 7 years of L-1 non-immigrant status. After the 1st year, you could apply for Lawful Permanent Residency based upon the fact you have been transferred from a managerial or executive position to a managerial or executive position. The advantage of using the L-1 is you do not have to make a minimum investment of $500,000 or more or employ 10 U.S. workers. The disadvantage is this can be very difficult for new offices to have these petitions approved today. To meet the definition of a manager or executive in a UAE company, typically, you must have a considerable number of employees to show that you occupied a managerial or executive position for at least 1 year and you need a similarly high number of employees in the U.S. for the same purposes. The real problem with this route is that many foreign nationals who wish to acquire their Lawful Permanent Residency really do not need or want to open a U.S. business or, even if they do, it may be a small business and may never justify developing the business to such a size that you could qualify as a manager or executive under the EB-1 multinational manager classification through your own business to qualify for Lawful Permanent Residency. The advantage of the EB-5 program is its simplicity and its predictability. Essentially, if you utilize an EB-5 Regional Center program, you can invest in a project where you already have not only an approved exemplar and with one or more approved petitions, you do not have to be responsible for the day-to-day management and, in fact, you have no managerial responsibility and, as a practical matter, all you need to do is have the financial means to effectively loan $500,000 for approximately 5 years. Your chances of success are extremely high with very little risk. Again, you do not have to be responsible for opening a U.S. business and maintaining that business for an extended period.

  • Avatar

    BoBi Ahn

    Immigration Attorney
    Answered on

    L-1 will give you the temporary ability to live work in the U.S., and eventually be able to process for lawful permanent residence as a priority worker through the L-1 company. If L-1 is a viable option for you and you have an immediate need to be in the U.S. to work/run the business/branch in the U.S., then L-1 may be the best option (since E-2/investor visa is not an option for UAE nationals).

  • Avatar

    Debbie Klis

    Securities Attorney
    Answered on

    That is a great question. As you know, both are visa programs. The L-1 only requires you to be an executive, manager or specialized employee in a multinational company to be qualified. The L-1 visa restricts an investor's stay in the U.S. to seven years but, at the end of seven years, the investor may apply for another U.S. visa. Thus, if a multinational employer does not currently have an office or branch in the U.S., an L-1 holder can be sent to establish a new one. To maintain status, he or she must only work for the sponsoring employer. In contrast, an EB-5 visa allows investors to obtain U.S. lawful permanent residency through investment. The job creation requirement for EB-5 is easier if the investment is associated with a USCIS-designated regional center where job creation may include indirect jobs calculated using a reasonable economic methodology. The benefit of an EB-5 visa is that the program leads to a permanent green card and eventually citizenship after five years of residency. The EB-5 program permits investment in other enterprises and employment while here in the U.S. and there is more flexibility. So, while the L-1 is steered more to your scenario and is simpler, the EB-5 program has fewer restrictions. On the other hand, the EB-5 visa may have a longer processing backlog than the L01. Sounds like you have some pros and cons to weigh.

  • Avatar

    Ian E Scott

    Immigration Attorney
    Answered on

    L-1 is a visa and EB-5 is a green card. With a green card, you can apply for citizenship in 5 years. L-1 could lead to a green card under EB-1 if the business expands significantly over several years. EB-5 will take a few years to get, so you may want to start with L-1 and then look at green card options.

  • Avatar

    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    You would want to examine all options. The L-1 company transfer will work if you are transferred to the United States as a senior manager or executive of a company with at least 20 employees. If not, you want to look at the EB-5 Immigrant Investor Program and other options. EB-5 is pretty good, now, as one can still qualify for the program with a $500,000 investment.

  • Avatar

    Sarah A Schroeder

    Immigration Attorney
    Answered on

    The L-1 is a nonimmigrant visa which permits individuals who have worked at least 1 out of the last 3 years in an executive, managerial or specialized knowledge position to come to the United States to open a new office that is an affiliate, branch, parent, or subsidiary of the overseas office and assume a similar position within the U.S. operation. The L-1 visa is a nonimmigrant work visa (not a green card) that is valid for a maximum of 5-7 years depending on whether the visa holder has specialized knowledge L-1B visa (5 years) or a managerial/executive L-1A visa (7 years). There is a green card corollary to the L-1A visa called the EB-13 (or EB-1C) which might be a good green card option, but it only typically works for very strong L-1A cases and only after the U.S. company has been operating for at least one year and is able to show sufficient revenues to qualify.

Add your comment

Use a Facebook account to add a comment, subject to Facebook's Terms of Service and Privacy Policy. Your Facebook name, photo & other personal information you make public on Facebook will appear with your comment.