For Applicants

I’m not a lawyer and not technically qualified to advise you, but I’ve been involved as a business writer in many EB-5 applications and I try to keep up on EB-5 law and lore. If you’re considering applying for a Regional Center or using direct EB-5 investment in your business, I have a few suggestions and resources for you.

Before you apply: Understand EB-5 and  determine whether it fits what you want to do

Like any funding program, EB-5 fits some business opportunities better than others, and you want to understand the limitations and requirements before you invest too much in the process. To some extent you can do this by calling up EB-5 service providers like me and asking us to vet your ideas. But keep in mind that it’s more fun for us to say “sure, I’ll help you apply for this and here’s my bill” then to discourage your business by warning about possible problems that you, not we, may meet down the road.  Not only that but you won’t be able to separate the good information from the fraudulent and outdated info out there if you don’t approach the process with some knowledge of your own.  A few suggestions:

1.  Read about the EB-5 program on the USCIS website:
EB-5 Immigrant Investor Visa
EB-5 Regional Center
EB-5 Immigrant Investor Process

2.  Look at the forms and instructions:
Regional Centers: Form I-924
Stand-alone EB-5: Form I-526

3.  Additional Resources: My EB-5 links page will lead you to most official documents related to EB-5. At least you should probably review the law at 8 CFR § Sec. 204.6.  The Adjudicator’s Field Manual gives an interesting look behind the scenes at how USCIS will review your petition. If reading through the official info makes you dizzy, you might consult a private website that provides accurate EB-5 FAQ (for example the EB-5 Resource Center at klaskolaw.com)

4.  Think through the practical considerations involved in applying EB-5 to your business. For example, I created a checklist for my direct I-526 clients with “Questions for Screening Appropriateness of Stand-alone EB-5 Investment”. (I also have a checklist for  potential Regional Center clients, but don’t dare publish it since my evolving understanding and  guidance updates from USCIS make the list change so often.)   Note that my checklists are based on my personal (conservative) perspective, and other advisers may disagree. In the end, you need to get some good legal advice and then decide what works for you.

5.  If you’re considering a Regional Center, attend an EB-5 event and talk to people. Get the gossip and stories from existing Regional Centers, meet service providers in person, and run your ideas by immigration agents to get their opinions on marketability. So long as you approach these events with a tight hold on your wallet and plenty of salt handy, you’re sure to learn a lot and save yourself time and trouble in the long run.

When you are applying: Know the instructions and follow them.

The lawyer you hire to file the application should be responsible for making sure that all your documents are in order, and you’ll be safer if you also understand what’s required. You may want to do the homework I suggest above, especially reading the forms.

Regional Center applicants, note the list of common reasons for Requests for Evidence and Denials from USCIS (included in the 9/15/2011 stakeholder meeting presentation) and be especially careful to avoid these common mistakes.

Common Issues Resulting in RFEs or Denials in Form I-924 applications

1.    Business Plan and Economic Analysis for Each Requested Industry Category (Form I-924, Part 7.) 
A.  The application is not supported by a business plan and economic analysis for at least one investment project with sufficient detail to show in verifiable detail how capital investment offerings in the requested industry will create jobs;
B.  Insufficient evidence and/or narrative that describes the investment project activities that the regional center will engage in for each requested industry category, to include;
1. The proposed number of investors for the project(s);
2. The timeline for starting and completing the projects to  demonstrate the requisite job creation;
3. A financial plan or budget including capital required and expenditures for  the investment projects.

2.  Reliability and Appropriateness of Data Sources for Economic Model Inputs, (Form I-924, Part 7.) 
A.  The application of national or state data in the economic model when more accurate regional data is readily available to demonstrate the economic impacts/job creation of the regional center’s investment projects;
B.  The data source for economic or business activity estimates for a given investment project, e.g. the data sources for estimates regarding total revenue generated or for the estimated construction costs (if applicable) for a given project .

3.   Choosing and Identifying Appropriate NAIC Codes. (Form I-924, Part 7.) 
A.  NAIC code should be appropriate to the requested industry;
B.  An overly broad NAIC code may not be representative of the requested industry;
C.  An overly narrow NAIC code may be too restrictive for the scope of the contemplated investment project(s) in the requested industry, e.g “NAIC Code 62” includes assisted living facilities but also covers hospitals.  There may be a more appropriate for the requested industry.

4.    Exemplar Form I-526s submissions should be documented with evidence with the level of detail required for an I-526 petition so that the exemplar petition if approved will facilitate the review of individual Form I-526 petitions (Form I-924 instructions, page 1.)  An exemplar Form I-526 petition should therefore:  
A.  Include a Matter of Ho compliant business plan and an associated economic analysis;
B.  Include project timeframes for milestones: project commencement, key construction or implementation dates, completion date, and time line for the requisite job creation;
C.  Clearly request approval for an exemplar I-526 and include a copy of an exemplar I-526;
D.  Include all documents needed for I-526 approval excluding an investor’s capital investment information;
E.  Identify the amount and source of non-EB5 financing needed for the project.