How quickly does an investor need to invest the required amount to qualify for the EB-5 Program?

Please note that, in a direct EB-5 investment case, you must invest or be in the process of investing at least $1 million unless the new commercial enterprise is principally doing business in a rural area or high unemployment area at 150% of national average rate. You must demonstrate at the time of filing an I-526 petition that the requisite amount of EB-5 capital is placed at-risk. Therefore, in reality, you will need to have the requisite capital at a minimum in an escrow account to demonstrate that you are in the process of investing. An escrow arrangement may be conditional on I-526 petition approval. In a direct EB-5 case, you must be engaged in the active day-to-day management of the enterprise or be engaged in the policy formulation role of a limited partner.

The investment cannot be gradual; the funds must be available for investment at the time the I-526 petition is filed. Depending on the nature of the investment, an investor may or may not be part of the day-to-day operation of the new enterprises. For instance, in the case of direct investment, an investor must be involved in day-to-day operation of the business entity. On the other hand, if the investment is through a regional center (RC), the investor does not need to be involved in the operation of the enterprise and, in addition, the investor can live anywhere.

Typically, an investor in a new commercial enterprise through a Regional Center must make the full investment at the outset of the process, at least by the time the EB-5 Petition on Form I-526 is filed. For direct investments, it does not necessarily have to be paid in full on the first day but within a reasonable period of time at the commencement of the process. Remember, the dollars need to be invested in order to create, in the case of a direct EB-5 investment, 10 full-time jobs which must also be maintained after the I-526 petition is filed. An investor is required to participate in the management a direct EB-5 petition but, with of an investment through a Regional Center, it is sufficient to be a limited partner.

The amount needs to be fully invested before the I-526 is filed.

To show that the petitioner has invested or is actively in the process of investing the required amount of capital, the petition must be accompanied by evidence that the petitioner has placed the required amount of capital at-risk. Evidence of mere intent to invest or of prospective investment arrangements entailing no present commitment will not suffice. The investor must show a commitment of the required amount of capital. Thus, while technically you could make the investment over the two-year period, the need to show that you have committed to the investment and not just promise to do so makes it hard if the money is not at least in the escrow account when I-526 is filed. As it is taking about 18+ months for the adjudication of I-526s, if the funds are not fully invested at the time of the filing, be prepared to show that you have invested fully when the RFE is issued. Otherwise, it is highly likely that your I-526 will be denied.

Regulations indicate the person must invest or be in the process of investing the requisite amount, which is present $1 million. However, in reality, if the full amount is not invested at the time of filing, there is a high probability the case will be denied. Please note the amount may be reduced to $500,000 only if the business is located in a targeted employment area, which is an either a rural area an area with a high unemployment rate (at 150% above the national average).

$500,000 (if the project/commercial enterprise is located in a targeted employment area. If not, the minimum required investment amount is $1 million) must be invested at the time of the filing of the I-526 Immigrant Petition for the investor.