Navigating the Restrictions on EB-5 Fund Transfers for Vietnamese Nationals

Despite the challenges Vietnamese foreign nationals face in transferring their investment funds to the U.S. due to currency exchange and local transfer restrictions, Vietnam is still among the top countries that participate in the EB-5 Immigrant Investor Program.

What is the EB-5 Immigrant Investor Program?

The EB-5 Immigrant Investor Program, or EB-5 visa program, is a popular option for Vietnamese foreign nationals looking to invest in the United States and obtain permanent residency. It allows foreign investors to obtain a Green Card by investing in a U.S. business that creates jobs for American workers.

We now provide some context on how EB-5 immigration works.

Under the EB-5 visa program, foreign investors must provide a capital investment minimum of $1.05 million in a new commercial enterprise (NCE), or $800,000 in a development located in a specified targeted employment area (TEA). The investment must be made in a qualified NCE, typically a new commercial real estate development.

In addition to the investment, the foreign investor must also create at least 10 full-time jobs for U.S. workers within two years of the investment. The jobs must be created directly by the business in which the investment is made, and they must be maintained for at least two years.

Once the investment and job creation requirements are met, the foreign investor and their immediate family members are eligible to apply for Green Cards and permanent residency in the United States. The Green Card provides investors and their family members with the ability to live and work in the United States permanently.

Direct vs. Regional Center Investment

There are two options for investing in the EB-5 program: direct investment and investment through a regional center.

Direct

Direct investments typically require a more hands-on approach and could require the investor to bear responsibility for creating and/or managing the success of the business. This can be a time-consuming and complex process, as the investor must identify a viable business opportunity, likely assist in developing a business plan, and have a hand in overseeing the day-to-day operations of the enterprise.

Regional Center

Investing through the regional center program, on the other hand, allows investors to pool their funds with others and invest in a larger-scale project managed by a designated regional center.

Regional centers are entities designated by United States Citizenship and Immigration Services (USCIS) to promote economic growth and job creation and encourage capital investment in specific geographic areas.

Regional centers may be able to offer investors a wider range of investment opportunities and more flexibility in their investment structure. In addition, regional center projects can calculate jobs based on construction spending, making it easier for investors to meet this requirement for immigration.

Understanding the Transfer Restrictions

However, transferring funds for EB-5 investment can be a complicated process for Vietnamese investors due to several factors.

First, the Vietnamese government has strict regulations on transferring funds overseas.

Vietnamese investors must follow the country’s foreign exchange regulations, which limit the amount of money that can be transferred abroad. These regulations require Vietnamese investors to provide documentation and justification for the funds they want to transfer, which can be a time-consuming and complex process.

Additionally, Vietnamese investors must ensure that their transferred funds comply with U.S. laws and regulations. EB-5 investors must provide documentation that the funds were legally obtained, and the source of the funds must be verified. This can be a complicated process for Vietnamese investors who may have difficulty in obtaining the necessary documentation, such as bank statements or tax records.

The process of transferring funds can also be complicated by the involvement of intermediaries, such as banks or remittance services. These intermediaries may charge high fees for the transfer of funds.

The EB-5 Reform and Integrity Act of 2022 (RIA) has brought changes to the EB-5 visa program, with a focus on identifying the people involved in transferring or exchanging an investor’s funds. Third parties assisting in the transfer of funds must now be identified, and USCIS has become stricter when reviewing currency transfer methods. While the RIA has created more hurdles in the EB-5 process, foreign wire transfers remain primarily affected by foreign government restrictions.

Overall, the complications of EB-5 fund transfers can make the process challenging for Vietnamese investors. However, with careful planning and the assistance of experienced professionals, investors can navigate these challenges and successfully obtain permanent residency in the United States through the EB-5 visa program.

Navigating the Restrictions

To address the issue of restrictions, investors should seek advice from their local advisors in Vietnam and consider options such as using currency transfer agents in Singapore or Australia or setting up U.S. bank accounts. It is essential that the transfer of funds is clearly documented in Form I-526E to satisfy USCIS requirements.

Experienced participants in the EB-5 visa process have found that opening U.S. bank accounts for foreign investors is an effective solution to streamline the transfer process and ensure funds reach their intended destination. However, liquidity and ongoing anti-corruption campaigns in Vietnam can make it difficult for investors to sell their properties or borrow enough funds to make an $800,000 investment.

Local U.S. regional centers have also been working on solutions, including US-based lending services with their regional center partners and clients, to help overcome these issues.

Next Steps

Ultimately, the decision of how to navigate the restrictions on transferring funds out of Vietnam will depend on the investor’s individual preferences, experience, and risk tolerance. It is important to conduct thorough due diligence on any potential investment opportunity and seek the guidance of an experienced immigration attorney and financial advisor before making a decision.

EB5AN is proud to offer a series of low-risk investment opportunities, as well as EB-5 and investment counseling services. Schedule a free consultation to learn more.