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EB-5 Immigrant Investors: Must Be Engaged in Managing the Enterprise

Simply being a passive investor having no involvement in the new enterprise is not enough for you to qualify as an EB-5 immigrant investor. You must be engaged in the management of the new commercial enterprise. This does not mean you are required to be employed in a management position that requires you to commit a significant amount of time working on the project. You only need to meet the requirement of being “engaged in” management as required by federal regulation. If you have questions about the EB-5 immigrant visa and would like to consult with an attorney, contact The Law Firm of Shihab & Associates. We have over 50 years of combined legal experience in a wide variety of complex and immigration law matters.

What does it mean to be “Engaged in management?”

To qualify as an EB-5 investor, you must be engaged in the management of the new commercial enterprise. This can be established by either one of two ways: by establishing that you have day-to-day managerial responsibility or that you are involved in formulating policy. USCIS provided guidance in its Policy Memorandum dated May 30, 2013, citing 8 CFR § 204.6(j)(5), that this can be satisfactorily established by providing sufficient evidence of one of the following:

  1. A statement of the position title that you have or will have in the new enterprise including a complete description of your position’s duties; or
  2. Proof that you are either a corporate officer or member of the corporate board of directors of the new enterprise; or
  3. If you are a limited partner, and the limited partnership agreement provides you with certain rights, powers, and duties normally granted to limited partners under the Uniform Limited Partnership Act, then you will be considered sufficiently engaged in the management of the new commercial enterprise.

What if I invest through a Regional Center?

There is still a management requirement even when the investment is made through a regional center. Regional centers prefer to have managerial control over project operations, and you will likely not be permitted to control the project. If your investment is in a project with an approved regional center, you will most likely be in the position of a limited partner, a non-managing LLC member, or have a minor managerial role, but you will likely not be involved in the day-to-day management of the new enterprise.

Most regional centers would offer you a limited partnership, which would in effect relieve you from time-consuming job duties or engaging in day-to-day management. This position would also relieve you of the burden of having to present sufficient evidence to the USCIS to establish that you meet the day-to-day management requirement, because you would simply provide proof of your limited partnership. If you would like further information about the EB-5 immigrant visa or any other immigration matter, please contact our immigration attorneys at The Law Firm of Shihab & Associates, Co., LPA to schedule a consultation with an attorney at an office near you.

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