Troubled Business & Job Creation

The eb-5 visa program recognizes that in the case of a troubled business, our economy benefits when the immigrant investor helps preserve the troubled business’s existing jobs. Therefore, when the immigrant investor is investing in a new commercial enterprise that is a troubled business or, in the regional center context, is placing capital into a job-creating entity that is a troubled business,the immigrant investor must only show that the number of existing employees in the troubled business is being or will be maintained at no less than the pre-investment level for a period of at least two years.

This eb-5 visa regulatory provision, while allowing job preservation in lieu of job creation, does not modify the numeric requirement; in the case of a troubled business, ten jobs must be preserved, created, or some combination of the two (e.g., an investment in a troubled business that creates four qualifying jobs and preserves six would satisfy the statutory and regulatory requirements).

A troubled business is defined as follows:

[A] business that has been in existence for at least two years, has incurred a net loss for accounting purposes (determined on the basis of generally accepted accounting principles) during the twelve- or twenty-four month period prior to the priority date on the alien entrepreneur’s Form I-526, and the loss for such period is at least equal to twenty percent of the troubled business’s net worth prior to such loss.

For purposes of determining whether or not the troubled business has been in existence for two years, successors in interest to the troubled business will be deemed to have been in existence for the same period of time as the business they succeeded.

Source: Taken from USCIS Policy Memorandum regarding EB-5 Adjudications Policy on November 9, 2011.