An “accredited” investor, as that term is defined by Regulation D of the Securities Act, which means any investor meeting at least one of the following conditions:
- Any natural person whose individual net worth (or joint net worth with that person’s spouse, if applicable) at the time of purchase exceeds $1,000,000; or
- Any natural person who had an individual income in excess of $200,000 or joint income with that person’s spouse in excess of $300,000 in each of the two most recent years and who reasonably expects an income in excess of $300,000 in the current year; or
- Any other “accredited investor” as that term is defined in Regulation D as adopted by the Securities and Exchange Commission.
The EB-5 applicant’s capital investment must be truly at risk. Guarantees of return of any capital are strictly prohibited, and if given negate the “at risk” requirement of the EB-5 law.
Source of funds
The investor must demonstrate that the capital is in fact his or hers and from a legal enterprise or legal operations.
New Commercial Enterprise
Be an enterprise formed after November 29, 1990; and be a for-profit enterprise formed for the ongoing conduct of any lawful business. A commercial enterprise may also involve expanding an existing business. And it has been established and is principally doing business in a targeted employment area (TEA).
Each foreign entrepreneur EB-5 investor must create at least 10 full time U.S.-based jobs When using indirect job creation, the applicant must use any accepted reasonable methodology to substantiate the creation of the requisite 10 jobs. You will need to submit a comprehensive business plan showing that, due to the nature and projected size of the new commercial enterprise, the need for not fewer than 10 employees will result. Using a designated Regional Center will help you with this process.
Participation in Day-to-Day Management
The applicant must have some Day-to-Day involvement in the management of the new commercial enterprise, such as serving as limited partners in an enterprise.