Creating a USCIS-designated EB-5 regional center can be a strategic move for American businesses looking to access capital by EB-5 investors funding.
Among its advantages is that established businesses can expand their fundraising potential, diversify their investor base, and undertake larger-scale projects with a broader economic impact.
Pros and cons of creating a designated EB-5 regional center
Under current EB-5 legislation, U.S. businesses can operate as private projects without affiliation with a regional center but can only obtain capital from a single EB-5 investor. Meanwhile, a business that creates a regional center or affiliates with one can accept EB-5 investments from many applicants.
However, navigating the process of obtaining a regional center designation and understanding the subsequent steps is complex. Businesses must have guidance from immigration and legal experts who specialize in EB-5 visa program compliance for a successful designation.
USCIS-Designated Regional Center for EB-5 Capital:
Pros: Regional centers attract various EB-5 investors funding, which increases the capital available for projects while lowering reliance on a single funding source. This diversification reduces risk and enhances financial stability. Additionally, projects funded through regional centers create jobs and make significant contributions to local development.
Cons: Having an EB-5 regional center entails navigating complex regulatory EB-5 requirements and reporting obligations and considerable expenses, which often demand additional resources and expertise. The management involves ongoing administrative tasks, such as investor relations and compliance, contributing to increased operational complexity.
Benefits and Drawbacks of Having One EB-5 Investor
Pros: Having one EB-5 investor through a direct EB-5 investment offers several advantages, including simplicity and speed due to reduced paperwork, which can lead to a quicker funding process. It fosters a direct relationship between the business and the investor, encouraging closer collaboration and communication. Additionally, the business maintains greater control over investment terms and project decisions, making it easier to navigate the investment landscape.
Cons: Relying on a single investor for an expansion project has several drawbacks. It may limit the available capital, constraining growth opportunities, and increase risk exposure since the project’s success is closely tied to that investor’s performance and decisions. Additionally, meeting job creation requirements for EB-5 compliance may prove more challenging with just one investor, as opposed to a larger pool in a regional center.
Criteria to obtain USCIS-regional center designation
Not every type of U.S. business can establish its regional center to attract EB-5 capital, among other points to consider:
- Eligibility Requirements: The business must demonstrate a solid business plan that shows how the EB-5 investments will create jobs in the designated area. The company should also have a history of promoting economic growth.
- Approval Process: The regional center must apply for and obtain USCIS approval to operate as a regional center under the EB-5 visa program. This involves submitting detailed documentation and evidence to demonstrate compliance with EB-5 regulations.
- Compliance: The business must comply with all EB-5 regulations, including job creation requirements and reporting obligations to USCIS.
- Investment Structure: The business should have a suitable investment structure allowing EB-5 investors to participate in the project in compliance with U.S. securities laws.
The business plan that the U.S. business must present when applying for a regional center permit must include:
- The target demographic of EB-5 investors and whether the business is in a Targeted Employment Area (TEA), either rural or high-unemployment.
- The amount of EB-5 capital required to create or preserve at least 10 full-time jobs. The minimum EB-5 investment is $800,000 for TEA projects and $1,050,000 for non-TEA projects.
- The role of the investors in the business and ensure that the offering complies with securities laws.
This business plan must have two distinct features: a clear economic growth focus and compliance with U.S. securities laws, job creation requirements, reporting obligations, and other EB-5 visa program requirements.
Once the business plan and the proper documentation, like a private placement memorandum (PPM), economic study, and other project documents, are ready, then the U.S. business must file Form I-956F, Application for Approval of an Investment in a Commercial Enterprise, with USCIS before accepting EB-5 investments.
Step-by-Step checklist for applying for EB-5 Regional Center designation
Define the Scope of the Regional Center: Decide the economic and geographic scope, including industry, location, business model, required investment amount, and total capital needed.
Hire an EB-5 Team: Engage industry experts, including EB-5 visa attorneys, corporate and securities attorneys, business plan writers, and economists.
Prepare Documentation: Develop a compliant business plan, economic job forecast, and other necessary documents.
File Form I-956: Apply for EB-5 regional center designation to USCIS. Once you receive approval, you can apply for the agency’s authorization of your EB-5 project by filing Form I-956F: Apply for approval of an EB-5 investment in a commercial enterprise before accepting EB-5 investments.
Maintain Compliance: Ensure ongoing compliance with EB-5 visa regulations, including job creation requirements and reporting obligations.
Marketing outreach to EB-5 investors funding through global events
Attending EB-5 industry events offers regional centers a valuable platform to connect directly with qualified investors, migration agents, and global partners. These events provide a unique opportunity to showcase active projects, build credibility, and establish trust through face-to-face interactions.
By participating, regional centers can gain real-time insights into EB-5 investors furnding, priorities, market trends, and regulatory updates—helping them tailor their offerings more effectively. In a competitive landscape, visibility and relationship-building are critical; industry events create the space to do both, ultimately accelerating EB-5 project funding and expanding their international reach. For upcoming EB5 events, click here.
Comparison of Direct vs. Regional Center EB-5 Investment
| Aspect | Direct EB-5 Investment | Regional Center EB-5 Investment |
| Number of Investors | One EB-5 investor | Multiple EB-5 investors |
| Job Creation | Direct job creation only | Direct, indirect, and induced job creation |
| Investment Amount | Minimum $800,000 in TEA, $1,050,000 in non-TEA | Minimum $800,000 in TEA, $1,050,000 in non-TEA |
| Management Complexity | Simpler management | Increased operational complexity |
| Investor Relationship | Direct relationship with investor | Indirect relationship through regional center |
| Risk Diversification | Higher risk due to single investor | Lower risk due to multiple investors |
DISCLAIMER: The views expressed in this article are solely the views of the author and do not necessarily represent the views of the publisher, its employees. or its affiliates. The information found on this website is intended to be general information; it is not legal or financial advice. Specific legal or financial advice can only be given by a licensed professional with full knowledge of all the facts and circumstances of your particular situation. You should seek consultation with legal, immigration, and financial experts prior to participating in the EB-5 program Posting a question on this website does not create an attorney-client relationship. All questions you post will be available to the public; do not include confidential information in your question.
