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How can we apply for EB-5 if we have stakes in a foreign company that will acquire a U.S. company?

My father holds 20% shares of an Indian company. The company is now considering acquiring a U.S. company with $10 million. What are the potential ways we can apply for EB-5 through this opportunity?

Answers

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    A Olusanjo Omoniyi

    Immigration Attorney
    Answered on

    Based on experience, this type of investment can certainly qualify for EB-5 but it may take the form of direct investment. However, the Indian company needs to prepare a very good business plan that includes all the information that shows the operations of the U.S. company will meet EB-5 requirements. Finally, the process may involve an assembly of EB-5 attorney along with various professionals, but this idea is feasible.

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    Barbara Suri

    Immigration Attorney
    Answered on

    EB-5 visas are for individuals who invest funds at-risk in a business in the U.S.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    To qualify for EB-5, your father must invest personal funds in a new commercial enterprise, not corporate funds via corporate acquisition of a U.S. company by an Indian company. Your father may want to consider L-1A visa as an option and then eventually immigrate to the U.S. via the EB-1C category if all requirements are met.

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    Lynne Feldman

    Immigration Attorney
    Answered on

    This should be doable if 10 new jobs can be created by the acquisition within a couple of years.

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    Charles Foster

    Immigration Attorney
    Answered on

    In order for your father to qualify for lawful permanent residency through the EB-5 program, he must make a direct investment, and must do so in his own name. If your father had a majority interest in the Indian company, it might be possible to do so through a company he controls, but even then, it is better to make the investment 100% in the name of the investor. Your father possibly could negotiate with the company that will make the $10-million investment, given the fact that he has a 20% interest to see whether or not the company would provide him a portion of that intended capital investment, so he could make the investment in his own name. These sources of funds would have to be explained as a dividend, gift, loan or return of capital.

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    Marko Issever

    EB-5 Broker Dealer
    Answered on

    First and foremost, your father needs to invest his own personal funds. It appears like given his ownership percentage in the Indian company, his indirect investment in the American company will be $2 million. As long as he is willing to divest a portion of his stake in the Indian company and directly invest that in the U.S. company, that could work. The issue would be buying an already existing business, which could be challenging. If it is not a troubled company where he is "saving" jobs, he might have to restructure or reorganize the company to make the investment EB-5 compliant. If you are already older than 21 or even if you are not, due to potential retrogression considerations, he should probably consider two applications: one for himself, your mother and young siblings, if any, and one for you. If the company is not in a TEA designated jurisdiction then he would need to invest $ 1 million for each application. He would need to gift you the $ 1 million so that you file on your own. Given the implied worth of his stake in the Indian company, it appears like this could be engineered. Best of luck!

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    He would have to make a personal investment into the U.S. company, even if he owned 100% of the Indian company.

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    Stephen Berman

    Immigration Attorney
    Answered on

    Could be, but it would need to be his money at stake, and not the corporation's money.

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    Phuong Le

    Immigration Attorney
    Answered on

    Sounds more like you should strongly consider whether L-1/EB-1C is an option for you if you qualify. It may be a better path given what you've described so far.

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    Hassan Elkhalil

    Immigration Attorney
    Answered on

    As much we we would like to answer, your question is very broad and requires a close attention and consultation with your business and immigration lawyers for best advice.

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    Mitch Wexler

    Immigration Attorney
    Answered on

    Depends who "we" is and how old you are. Generally, if you are under 21 when the EB-5 petition is filed and your dad is the investor/applicant, you can get the green card with him. His investment must be from his personal funds, not from his business. So he will have to realize the income and then invest in the U.S. business. If you are over 21, he can gift you the funds and you can be the investor/applicant. The investment must create 10 additional jobs. There are exceptions for failing businesses. You should consult with an experienced EB-5 lawyer at this point.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    The investment has to be made personally and not by a corporation, so this likely will not work for EB-5. Also when you buy an existing business, unless it is a troubled business and you are saving jobs, it is very hard to prove actual new job creation. The other two options are to purchase an existing business and subsequently restructure or reorganize such that a new commercial enterprise results. The other option is to expand the existing business such that a 40% increase either in the net worth or the number of employees results, but generally you need to create at least 10 new jobs.

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    Mark AM Catam, Esq

    Immigration Attorney
    Answered on

    Additional facts of the case are needed to determine plausibility of EB-5. If structured properly, it may be possible. You'll need an experienced EB-5 attorney who specializes in direct EB-5. I have structured companies designed to meet EB-5 requirements.

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    Belma Chinchoy

    Immigration Attorney
    Answered on

    EB5 requires a personal investment (not a company's investment). Have part of the investment come from the EB-5 applicant directly.

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    BoBi Ahn

    Immigration Attorney
    Answered on

    For EB-5 purposes, your father has to invest his own personal funds in a company/commercial enterprise in the U.S. and not through the Indian company. It may make more sense for him to divest from his investment in the Indian company and put that money in the U.S. company (if that amounts to $500,000 if the company is located in the TEA or $1 million if not located in TEA) for EB-5 purposes, and create at least 10 full-time jobs, etc. through the U.S. company.

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