Foreign Investors Seeing EB-1C as Alternative to EB-5

Under EB-5, a foreign investor is required to make the necessary investment in a commercial enterprise in the United States while creating 10 permanent full-time jobs for qualified U.S workers by way of regional centers. Though the trial program has created tens of thousands of jobs and contributed billions to the GDP, the EB-5 path is not without flaws, and many investors are looking elsewhere.

So what’s the alternative? The EB-1C program (also referred to as EB-13) offers several strategic advantages over the EB-5. The fundamental purpose of EB-1C is to allow foreign managers and executives who can acquire or grow a thriving U.S. company to transfer their top-level employees to the U.S. for permanent residence. To qualify for EB-1C, the executive or multinational manager must be petitioned for by a U.S. company that has been doing business for at least a year.

In contrast to EB-5, under EB-1C, an investor with the necessary experience in the overseas entity does not need to wait outside the U.S. for months before entering in a work-authorized capacity. Instead the U.S. company can file an L-1A petition on behalf of the investor. In as little as two weeks, the investor can enter the U.S. to ramp up operations. The investor’s family can also enter the U.S. with work authorization and, with the proper petitions and extensions, can remain in the U.S. for a maximum of 7 years.

Another key factor to note is the documentation of personal funds required under EB-5 in which an investor must thoroughly trace and report personal funds back to its origins in efforts to prove its lawful acquisition. EB-1C only requires documentation of corporate funds and transactions between the U.S. entity and the investor, resulting in the ease of process and records the legitimacy of the business relationship.

In regards to company operations and growth, EB-5 requires investors to hire and maintain 10 U.S. employees at once, whereas EB-1C allows the investor to hire as operations grow over time and positions are organically realized. This lightens the load and contributes to the company’s success rate.

Most attractive and beneficial to the investor on the EB-1C path is the stability holding an L-1A status provides. An investor, his spouse, and children can hold green cards, work and attend school for up to 7 years while the EB-1C petition is pending. If the petition is denied, the investor can simply refile the EB-1C petition the very next day without compromising his status or the status of his spouse and children.

EB-5 has historically provided a foolproof option for foreign investors to enter the U.S. market for decades, however, the process is cumbersome and notorious for tedious obstacles. EB-1C offers both the stability and predictability that attracts foreign investors to the U.S. market. As petitions for EB-5 bottleneck and the wait for permanent residency under this program lengthens, foreign investors are seeing EB-1C as a strategic alternative with greater returns and benefits.

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