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US EB-5 Program
Q. What is a US EB-5 Investor Visa?
The EB-5 Visa is a path to a green card based on a US investment. The EB-5 visa does not require the applicant to manage the day-to-day affairs of a business. One may invest in an existing business, or a new business. More than one person may invest in the same business. The EB-5 investor may be a minority owner of the business.
Q. How does one qualify for a US Investor Green Card?
1. Invest US$1 million and hire ten employees anywhere in the USA
2. Invest US$500,000 and hire ten employees in an area where the unemployment rate exceeds the national average unemployment rate by 150%
Q. Who applies for the EB-5 Visa?
EB-5 investors include people from all walks of life; professionals, business people, persons wanting to facilitate a child's education, and retirees. Because the EB-5 visa permits employment in the US, many EB-5 investors become involved in charity or part time work. If you don't want to actively manage your business, you should consider EB-5. NG Franchise Services (NGFS) as your partner will hire day-to-day managers of your business.
Q. How long will it take to obtain the Visa?
We can't predict or promise a particular processing time. This will depend on how fast you submit the required documentation. You should plan for the entire process to take approximately 24-30 months. The green card issued will be "conditional" and initially valid for two years, during which time you may remain in the US as a permanent resident.
The applicant will not have to live in the USA while the application is pending, unless he/she has some other working visa (H, L, E, O, etc). Once the green card is approved, the applicant must maintain status or it will be voided.
Q. What happens next?
Your attorney will file on your behalf a petition to have the U.S. Citizenship and Immigration Services (USCIS), which was formerly known as the Immigration and Nationalization Service (INS) remove any conditions. The petition must show that the business investment continues as of that date, and show the financial status of the company. Also it must show the actual jobs created during the two-year conditional period.
When the investment is an existing business you must show that the investment with its restructuring and reorganization will result in an expansion of the business by forty percent or more. This is measured by the business net worth or number of employees.
Q: What documents must I prepare to process my visa petition?
1. Complete biographical information for each applicant
2. Five years of foreign tax returns
3. Five years of bank records
4. Proof of ownership in any US businesses. We (NGFS) will match you to a qualifying business and help you acquire it).
5. Financial statements for each business and business licenses.
6. Official document showing proof of where investment capital originated, such as a closing statement on the sale of a house, or proof of an inheritance or gift.
7. Other documents may be required and vary on a case-by-case basis.
Q: What are the Visa processing procedures?
A general outline of the application process follows. An attorney will be able to give you a more complete description. NGFS will place you with a law firm which specializes in EB-5 Visa submissions.
Step 1) File form I-526 Petition for Alien Entrepreneur with a State Service Center. This petition requests INS to certify the applicant and the investment as eligible for EB-5 visa status.
Step 2) Upon approval of the I-526 petition, (a) if you are in the United States you may apply for Adjustment of Status to Permanent Residence by sending form I-485 and supporting documents to the INS regional processing center nearest your US residence. (b) If you are abroad you must wait for notification from the US Embassy in your home country to prepare documents for the visa interview.
The purpose of the Adjustment of Status or consular visa interview is to make sure you are not subject to grounds of exclusion, e.g. a criminal past, infectious diseases, etc. This step takes 12-18 months after approval of the I-526.
Step 3) Upon approval you receive a form evidencing the approval and as well as a travel document. You will also receive the temporary green card in the mail. If you are abroad you must enter the US within six months of the date of the Embassy approval.
Step 4) After two years, you must file for removal of conditions or your permanent green card using Form I-829, or the green card will lapse. This procedure permits INS to verify that you have maintained your approved investment for the required two-year period. This takes another 12-24 months to process, although the individual and family remain in the US during the processing.
Q: What issues have been problematic in EB-5 cases?
Insufficient documentation of the source of funds. Many people try to disclose the least possible information only to have the file returned with a request for further information. It is better to provide too much information rather than too little information. In this era of terror alerts, and suspicions about money laundering, USCIS case examiners require a well-documented source of funds. This is a critical item of information required.
Q: Many EB-5 programs include immigration processing as part of the investment package. Why doesn't NG Franchise Services, Inc. do the same?
We believe that it is important for you to have independent legal counsel representing your interests. If you shop for the least expensive legal services, the entire deal can be jeopardized. It is critical that the law firm has a high degree of expertise and experience in this legal specialty. NG Franchise, as your consulting firm, reserves the right the right to preapprove the law firm which will handle the application. We believe it is better to focus on what we do best, providing the best returns on investment to you.
We work closely with immigration and franchise attorneys around the world. As a result we have some idea of which lawyers handle EB-5 cases and will be happy to suggest an attorney. You will make your own arrangements with the attorney, however NGFS will endeavor to make the attorney's job as easy as possible.
Q. Why choose NGFS as your investment advisor?
Nancy Ghanem, President of NG Franchise Services (NGFS) has more than 20 years franchise and both residential and commercial real estate experience. Having lived and traveled extensively abroad she understands the issues related to cross cultures, privacy, and needs.
Q. What services do you provide?
NGFS will:
1. Consult with you to determine your interests
2. Assist you find the right investment which will qualify for the Visa.
3. Direct you to a law firm in the USA. The USA law firm will:
a. Prepare and review the Limited Partnership agreements for either a franchise or business
b. Review real estate contracts on your behalf
c. File the Visa application(s) on your behalf
4. Perform as a limited or general partner in a Limited Partnership. We will
a. Evaluate, negotiate, and purchase the franchise business
b. Evaluate, negotiate and purchase or lease of your residence. Your residence need not be near the investment business since you will not be the manager. You will however be involved in policy decisions.
c. Assist by hiring the business manager , however often a manager is already in place who has operated the business successfully on behalf of the former owner.
d. Assist by finding you an accountant
e. Assist you open bank accounts
f. Provide you with reports and see that the accounting is properly handled and that you are paid a return on your
investment when due.
Q. What is a Limited Partnership?
A limited partnership combines corporate limited liability with partnership taxation. The limited partnership, formed by filing a charter with a state government, consists of a general partner and one or more limited partners. The charter details the rights and powers of the limited and general partners, percentages of ownership, and distributions of profits. The general partner manages the business. As in a corporation, the limited partners are passive investors liable only for the value of their investment. As in a general partnership, limited partnership income is taxed at the partner level, not at the entity level.
Q: How is my limited partner interest protected?
The Certificate of Limited Partnership must be recorded with the State of Washington as a public record. The Certificate refers to a Schedule A of the limited partnership agreement, which lists the names and percentage interests of the limited partners. The deed for the investment property is held in the name of the limited partnership. The deed is also of public record. This means the property cannot be sold, mortgaged or altered without complying with the terms of the limited partnership agreement.
Q: Is my investment guaranteed?
No. The law requires an "at risk" investment without guarantees or redemption rights.
Q: What are my risks?
As in any investment there is a risk of total loss. We invest in real estate without mortgage or bank financing. This lack of debt eliminates much of the risk of total loss. Like everybody we risk the deleterious effects of acts of god, war, and market fluctuations in rental income or real estate prices. We urge all investors to visit us, check our references and to independently verify the information contained in our prospectus.
Q: Why must I invest before you will apply for my green card?
We understand that other investment companies accepting EB-5 investors place funds in a trust or escrow account pending visa approval. In this case the funds may only be released upon visa approval. Escrow or trust agreements present immigration difficulties.
We offer business investment opportunities on a first first-come first first-served basis. While your investment capital sits in escrow or trust pending the results of a visa application, which may take six to eight months to complete, the target investment, which formed the basis of your visa petition may have been sold out to other investors. You would be in the unfortunate position of basing your green card on an investment that didn't exist, and run the risk of having your application denied. Finally, although the regulations permit escrow arrangements we find that INS looks more favorably on petitions based on a completed investment rather than a pending one.
Our primary business is franchise and real estate investments. Most of our capital comes from investors who do not seek an immigration benefit. These investors invest on financial consideration only, without preconditions.
EB-5 investors, however, have two considerations, the soundness of the investment, and obtaining their green card. The investment must be analyzed upon its merits.
Our policy is to require that you commit your capital as any other investor. If for some reason, you do not receive your green card, our contract with you provides an option for us to find a new investor(s), providing a source of funds to refund your investment, should you fail to obtain your green card.
Hopefully, you will be satisfied with your investment and wish to keep all or part of the investment regardless of the outcome of your green card application. The need for a green card is situational. You may decide you don't like life in America, or your family or economic situation may change. The need for sound investments never changes. While you would not have come to us unless you were seeking a green card, we hope you will be more than satisfied by our investment results and service.
Q: How does the partnership distribute income?
Each partnership distributes profits to its investors monthly. The distributions are based on the prior month's gross rental income net of expenses. Investors receive a profit and loss statement with each month's distribution. At the end of the year the partnership issues a summary report along with Internal Revenue Service form K-1. Form K-1 details your yearly income and expenses. Your accountant will require form K-1 to prepare your US annual tax return.
Q. What fees will be due to NGFS?
NGFS requires an upfront consulting and retainer fee. We will spend time with you to help you understand your needs and business investment interests.
We will negotiate on your behalf and be paid a commission on the business investment from you at time of the business purchase, and or real estate purchase or lease, however that commission will in fact be the commission normally due to us from the seller, which will in effect be the same amount as the discount on the purchase price which we have negotiated on your behalf. We represent you and not the seller.
We will also be paid a monthly investment management fee.
At time of resale, we will be the exclusive broker for the transaction and will be paid a commission at time of sale of the business and/or the real estate.
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