U.S. Sanctions on Russia and the impact on Russian EB-5 investors

Since the collapse of the Soviet Union in the early 1990s, the United States has welcomed a steady flow of immigrants from Russia – many settling in cities like Miami, New York, Denver, Los Angeles and Baltimore.

Russian EB-5 investors, while prosperous in Russia, choose to leave when government corruption and unpredictability become a factor.  These individuals recognize that Russia cannot provide a safe investment environment to protect their wealth, only economic uncertainty. This is evident with Russia’s recent annexation of Crimea, which contributed to the ruble and Russian stock market plummeting earlier this month. The $500,000 EB-5 investment now costs up to 8% more in rubles than it would have just a few months ago. Fortunately, many wealthy Russians who qualify for the EB-5 Visa maintain dollar and/or Euro accounts outside of Russia.

With the recent U.S. sanctions in place, can Russian investors expect other uncertainties during the investment process?

On its face, it appears that unless the investor is part of President Vladimir Putin’s “inner circle”, most EB-5 clients will not be directly affected by the sanctions.  However, although the sanctions appear insignificant to most individuals in Russia, recent sanctions against Bank Rossiya for example, prompted Standard & Poor’s (S&P) rating agency to downgrade its outlook for the lender from stable to a negative rating. As a result, the S&P foresees a deterioration of the bank’s future business and financial profiles. Further, Bank Rossiya can no longer engage in dollar-based transactions, and western banks will not be able to engage in business with them. 

The sanctions on Bank Rossiya were meant to directly impact Putin and other top government officials. The actual ramifications to potential investors, for now, are minimal. However, some economists are predicting the crisis over Crimea could tip the Russian economy into a recession this year, which could serve as a push to potential EB-5 Investors to leave Russia sooner.

Barella Law | +1 (239) 228-2895 | kbarella@barellalaw.com | www.barellalaw.com

The Information contained in this blog is for information purposes only, and should not be considered legal advice for any individual case or situation.  The information provided is not a substitute for consultation with an attorney.  No attorney/client relationship is created by the information contained herein.

The Cost of an EB-5 Regional Center Project Investment

As an immigration attorney representing EB-5 investors, one of the frequently asked questions is: what is the total cost of an EB-5 Regional Center investment?  Savvy investors understand, in order to go through the EB-5 Visa process, they will incur other expenses in addition to the $500,000 capital investment.

So what is the cost of an EB-5 investment?  Unfortunately, there is no set dollar amount.  Each client’s case is distinct, and there are a multitude of factors that may influence their costs.  This article will address the most common EB-5 costs - but it’s important to keep in mind that expenditures for your specific case may vary.

The Investment:
One cost that is universal for all clients is the invested capital.  Most Regional Center projects are located in a Targeted Employment Area, which allows for a reduced investment amount of $500,000.

Legal Fees:
Just as you wouldn’t forgo obtaining a doctor to perform a surgery, you also want to be sure to retain a competent EB-5 attorney to file your petition.  Depending on whether your lawyer bills a flat fee or hourly rate for an EB-5 investment, you can expect to pay anywhere from $10,000 to $20,000 for legal services.  Depending on the firm you choose, this may or may not include the services of an EB-5 Investment Advisor.

Project Administration Fees:
The majority of projects out there charge an administration fee when subscribing to their project.  The typical administration fee ranges from $30,000 to $60,000.  These fees are generally used to pay marketing costs, as well as “finder fees” for agents abroad.

Filing Fees:
With every I-526 Petition filed, USCIS requires the payment of a filing fee.  Currently, the filing fee for an I-526 Petition is $1,500.

Translation Fees:
USCIS requires any documentation or evidence not in English to be accompanied by an English translation.  Further, in their latest EB-5 stakeholder meeting, USCIS indicated that the entire document will need translating and abstract translations are not accepted.  Translation service fees vary depending on the document content and number of words.  You can expect to pay between $0.25 and $0.50 per word.

Miscellaneous Costs:
If you choose to travel to the US to speak with Regional Centers or your attorney, you might incur additional expenses such as travel, housing and visa costs.

Although these are a few of the most common expenses associated with the EB-5 investor visa, additional costs may arise depending on your individual case.  You may also be able to mitigate the costs of EB-5 through varies means.  A conservative estimate of an EB-5 investment from start to finish will be around $568,000.

Barella Law | +1 (239) 228-2895 | kbarella@barellalaw.com | www.barellalaw.com

The Information contained in this blog is for information purposes only, and should not be considered legal advice for any individual case or situation.  The information provided is not a substitute for consultation with an attorney.  No attorney/client relationship is created by the information contained herein.

Conférence Snowbirds en Floride (Snowbirds Conference in Florida)

On January 28, Barella Law, LLC spoke to a group of Quebeckers at the annual Conférence Snowbirds en Floride (Snowbirds Conference in Florida) in Aventura, Florida.

The conference was a great opportunity to explain the different immigration options Canadians have to enter to the US.  We also had the opportunity to meet others in professional industries that serve snowbirds in Florida.Along with our immigration firm, other speakers included a CPA, insurance representative, financial planner, and a Québec attorney.

The conference attendees were very receptive and eager to ask questions.  Barella Law continues to promote and build a relationship with our clients in Québec, as well as other parts of Canada, and around the world. We look forward to hopefully participating in next year’s conference.

Barella Law | +1 (239) 228-2895 | kbarella@barellalaw.com | www.barellalaw.com

The EB-5 Misconception

Does the EB-5 program allow potential immigrants to “cut” to the front of the immigration line? The answer is a definitive, no.  Believed by many to be a shortcut to US permanent residency, the EB-5 program is not a line-cutting program.  In fact, the US Government sets aside each year, 10,000 visas for EB-5 investors.  Of the 10,000 visas, 3,000 are set aside for investments made in Target Employment Areas (TEA).  

As the government specifically sets these visas aside, it’s not possible for EB-5 investors to steal visas from other immigrants or jump to the front of the line.  Compared to other countries around the world that utilize a point system for immigration, the United States does not have such a program.  Unless a potential immigrant has a job or family member available to sponsor them, there are limited options for obtaining US Permanent Residency.  

The EB-5 Visa Program allows these immigrants with limited options to legally move to the US.  This misconception that EB-5 investors “buy” their way into the US at the expense of immigrants of lesser means is outdated and simply incorrect.  The government implements visa quotas, which allow each visa category a limited number of spaces.  

The benefits of the EB-5 program provide immigrants with a chance to live, work and study in the US, with the added benefit of their investment contribution leading to the growth of the US economy.  

Barella Law | +1 (239) 228-2895 | kbarella@barellalaw.com | www.barellalaw.com

The Information contained in this blog is for information purposes only, and should not be considered legal advice for any individual case or situation.  The information provided is not a substitute for consultation with an attorney.  No attorney/client relationship is created by the information contained herein.

Lawful Source of Funds for EB-5

Perhaps the most important aspect of any EB-5 Petition is the Lawful Source of Funds requirement by USCIS.  For apparent reasons, USCIS must ensure that every petitioner has acquired the funds to make their EB-5 investment through lawful means.

Given the different accounting and taxing principles around the world, this sometimes proves to be difficult to trace.  Through no fault of the attorney or investor, some countries simply do not practice the standard of record keeping required by USCIS.  This hurdle may be overcome by providing affidavits and other evidence and documentation to get around the deficiency.

Communication between the client and the attorney is most crucial during this stage of the EB-5 process.  An attorney may only perform his/her job when the client has made a complete disclosure of their source of funds.  USCIS needs to see the money traced back to its origin.

For example, if an investor claims to have gained the funds for the investment through the sale of a property, he must show more than just the bill of sale for that property.  USCIS will want to see that he was in fact the owner of the property, and owned it for a reasonable time.  This may be proved by the investor providing his original purchase agreement, or other evidence to prove ownership.

Although the EB-5 Investment is $500,000 for Regional Center Projects located in target employment areas, there are other costs associated with the investment.  Generally an administration fee is assessed to the Petitioner.  Although an attorney should not have to account for the administration fee in the Lawful Source of Funds, the trend among EB-5 attorneys has been to provide documentation accounting for that money. The last thing an attorney wants is to give USCIS an excuse to issue a Request for Evidence (RFE).

Barella Law | +1 (239) 228-2895 | kbarella@barellalaw.com | www.barellalaw.com

The Information contained in this blog is for information purposes only, and should not be considered legal advice for any individual case or situation.  The information provided is not a substitute for consultation with an attorney.  No attorney/client relationship is created by the information contained herein.

Business Opportunities for the Québécois in Sunny Florida

By Anna Barella |Choice Investments|  www.adviseusa.com

Earlier this week the team at Choice Investments attended a business-networking event hosted by the Québec-Florida Chamber of Commerce.  At the event, we met local business owners originally from Québec, Canada now doing business in Florida, and in some cases those who still operate a business back home. The Québec – Florida Chamber of Commerce offers local and Québec businesses a unique ability to grow their business both in Florida and Québec.  

Each year, Florida welcomes over 800,000 snowbirds from Canada, and nearly a quarter of them hail from the Province of Québec. Every winter they typically spend anywhere between one and six months enjoying Florida’s beaches, shopping, dining and great weather.   Many also invest in real estate, both residential and commercial properties. 

Last year alone, Canadians contributed over $4 billion to Florida’s economy. Many choose to legally reside permanently in Florida, either by immigrating or opting for non-immigrant status such as the TN or E-2 visa. Should the US Government pass the Immigration Reform bill, many Canadians will be allowed to stay in the US for up to eight months out of the year. 

The EB-5 Immigrant Investor Visa remains popular among Canadians wishing to permanently immigrate to the United States.  By becoming a US permanent resident, the investor is able to take full advantage of business opportunities in the US and back in their native Canada.  We saw first hand the success of Quebeckers creating a cross-border life for them self.  Ultimately both the Province of Québec and the State of Florida benefit economically from entrepreneurial endeavors of the Québécois.

The EB-5 Visa: An Increasing Contributor to the Growth of the US Economy

The EB-5 Visa Program has a reputation of being a cash for green card business.  Some view it as a system where wealthy individuals essentially buy their way into the United States.  However, this misconception of the EB-5 program is inaccurate and has often led to negative press regarding the visa.

While it is true that foreign nationals who invest through the EB-5 visa must furnish at minimum around $550,000 ($500,000 investment plus regional center administration fees and legal fees), not all of the investors come from extreme wealth.  Many investors work hard to save the money over years, take out a loan (secured on assets) or inherit the money from family.  These investors make sacrifices in their lives because they still believe in the “American Dream,” and understand that this country still has much to offer.

The EB-5 Visa Program is beneficial to both the foreign investor and the US economy.  Apart from creating ten jobs for US Citizens or Permanent Residents (A requirement for obtaining the EB-5 visa), these foreign nationals invest in real estate, contribute to the local economy, and enroll their children in university programs.  Compared to other paths of obtaining permanent residency, the EB-5 visa comes with positive advantages for US citizens and our economy.

A growing trend among potential EB-5 candidates is their discovery of the program through their student child.  F-1 Student Visas are on the rise, and today more than ever, foreign students are coming to the US to take advantage of our educational programs.  Often, when the student is finished studying their program they have no legal status to remain in the United States.  Unless they secure a job that is willing to sponsor them, they must eventually return to their home country.

Many students are doing their own research on the EB-5 Program, and encouraging their parents to make the investment on their behalf.  It is important to note that unmarried children under the age of 21 may be included on their parents’ petition.  For children 21 years and older, they must file their own EB-5 petition.

Barella Law | +1 (239) 228-2895 | kbarella@barellalaw.com | www.barellalaw.com

The Information contained in this blog is for information purposes only, and should not be considered legal advice for any individual case or situation.  The information provided is not a substitute for consultation with an attorney.  No attorney/client relationship is created by the information contained herein.

My EB-5 Visa Petition Has Been Approved...Now What?

Next steps in the EB-5 Visa process

Waiting for one’s EB-5 Visa petition to be approved by USCIS can be a stressful time in an Immigrant Investor’s life.  Your future is uncertain and placed in the hands of the US government.  However, when you finally do receive that call from your attorney informing you that your petition has been approved, you realize it was worth the wait.  You are now one-step closer to permanent residency in the US, and eventually US citizenship.  But what happens next?  What does an I-526 Approval Notice entail?

Once your EB-5 Visa petition has been approved, your attorney must either 1) adjust your status, or 2) initiate consular processing.  Which path your attorney takes is determined by your current location.  

By far, the easier and more convenient option is to adjust status.  However, an attorney may only adjust an Immigrant Investor’s status if the client is present in the United State at the time of the EB-5 approval and able to remain lawfully in the US during the adjustment of status filing.

For adjustment of status, timing is key.  For example, immigrant investors who are presently residing in the US on an F-1 Student Visa may adjust their status upon approval of their I-526 Petition.

The more common way for investors to complete their EB-5 process is to have the attorney initiate consular processing.  In these instances the investor is currently residing in their home country (or another country abroad) and is not present in the US at the time of their I-526 approval.

When an attorney begins consular processing for a client it originates with the National Visa Center, or NVC.  During this process the investor will be required to provide certain original documents for the attorney to present to the NVC.  After the attorney has completed their work, an appointment will be scheduled for the investor at their designated US embassy or consulate.

For more information on the EB-5 process contact our office today.

Barella Law | +1 (239) 228-2895 | kbarella@barellalaw.com | www.barellalaw.com

The Information contained in this blog is for information purposes only, and should not be considered legal advice for any individual case or situation.  The information provided is not a substitute for consultation with an attorney.  No attorney/client relationship is created by the information contained herein.