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What are requirements for investing in a newer EB-5 company?

If I am investing $1 million in a company that has been operating since 2013, does that company HAVE to show a 20 percent annual net loss in order for me to invest in it and qualify for an EB-5 visa, or is that requirement just for pre-1990 companies? And does my investment have to represent a 40 percent increase of that company's value? Or is it enough that I just invest the $1 million and create the 10 jobs, regardless of its current state?

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    Raymond Lahoud

    Immigration Attorney
    Answered on

    A new commercial enterprise is one which is: (1) established after Nov. 29, 1990, or, (2) if established on or before Nov. 29, 1990, that is (a) Purchased and the existing business is restructured or reorganized in such a way that a new commercial enterprise results, or (b) expanded through the investment so that a 40 percent increase in the net worth or number of employees occurs. As for existing businesses established post-Nov. 29, 1990, the investment would have to be into the company that is restructured or reorganized. Changing the legal structure or name of an enterprise is insufficient. It has to be a conversion - something different. Or, you can expand an existing business. Through this, an EB-5 investor must either expand the net worth of an existing business or the number of employees by 40 percent. If an investor chooses to increase the number of employees, the investor may be required to create more than 10 jobs; the larger the number of existing/current employees, the more of a burden on job creation grows.

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    Charles Foster

    Immigration Attorney
    Answered on

    If you invest $1 million in a company that has been operating since 2013, it does not have to show a 20 percent annual net loss in order for you to invest, provided you can show that as a result of your investment at least 10 new jobs were created for U.S. workers.

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    John J Downey

    Immigration Attorney
    Answered on

    What you are referring to is a "troubled business" category under the statute. The company you mentioned does not seem to fit that category. Your investment would only have to show the creation of the 10 new jobs.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    The 40 percent rule applies unless it is a troubled business. Caution because USCIS applies these rules in a confusing way, basically meeting these requirements, plus focusing on creating 10 new jobs.

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