Can multiple investments in unrelated businesses qualify an investor for an EB-5 visa?
A number of investments in separate, independent businesses cannot qualify the investor for an EB-5 visa. However, if they have already invested in an EB-5 offering, it is possible to generate a number of businesses through this investment. Each business must be owned by the investor as a subsidiary or branch of the parent company, which is considered the new commercial enterprise (NCE) and beneficiary of EB-5 funding capital. Further information on the differences in NCEs between direct investment projects and regional center–sponsored projects can be found below.
For regional center–sponsored EB-5 projects, the NCE and job creating enterprise (JCE) are two distinct entities. The scope of these projects is typically larger than those of their direct-investment counterparts, so they usually consist of multiple entities.
For direct EB-5 projects, the NCE and JCE are one entity. Thus, the NCE of the direct EB-5 project must be the sole recipient of the investment capital. In terms of investors who wish to invest their funds into a subsidiary owned by the original business, the original business would be regarded as the NCE in accordance with its proprietary hold over the daughter company. As such, each subsidiary that is given EB-5 funding would be expected to create jobs—minimum of 10 positions per investor.
If the original business is situated in a targeted employment area (TEA) and is eligible for the reduced investment sum, its subsidiaries must also be situated within the region of the TEA. If the investor does not comply, they will not be eligible for the lower investment sum.
The definition of a commercial enterprise entails any of the following profitable, lawfully conducted activities: individual ownership, partnership, holding company, joint venture, corporation, business trust, or any publicly or privately owned entity. A commercial enterprise may also be a parent company and its fully owned subsidiaries, as long as each branch or daughter company is a correspondingly profitable, lawfully conducted activity.