20 May Increased Brazilian Interest in EB-5: Why EB-5 Visas are a Good Option for Brazilian Investors
Brazilian nationals seeking admission to the United States are not eligible to apply for the E-2 Treaty investor visa[1]. Brazil is not a Treaty Country,[2] so potential Brazilian investors must find alternate options for coming to the U.S. to invest in and manage a business.
Fortunately, the EB-5 Program remains a viable and attractive option for Brazilian investors seeking residence in addition to investment in the United States. Qualifying foreign nationals from any country can file Immigrant Investor petitions in order to obtain permanent residency in the EB-5 category. While the Department of State does place a fixed limit on the number of visas it grants to a particular country or region, historically, only Chinese applications have reached this quota limit.[3] In any case, visa limits are reset at the beginning of the federal government’s fiscal year, which begins on October 1st.
According to Luciana Zamith Fischer, a Brazilian-born U.S. immigration attorney at Zamith Fischer Law, Brazilian interest in the EB-5 Program has increased significantly in recent years. Though Brazil contributed just two EB-5 investors in 2005, 28 EB-5 visas were issued in 2013,[4] and 30 in 2014;[5] and demand is currently on the upswing. This increase is likely a result of Brazil’s challenging political climate and increasing crime rates, as well as deep concerns over the country’s current economic situation and rising inflationary pressure, which serve as catalysts to those with means to seek alternative places to live, develop businesses and raise families. Having experienced a booming economy during past years, and a quick recovery from the global economic downturn, Brazilian investors are now looking outside the country’s borders for investment opportunities, and a better quality of life. After Brazil’s economy opened up to the world in the 1990s, Brazilian perspectives have become more global, and demand for EB-5 investments evidence a trend for increased global mobility by the country’s investors.
Additionally, Brazilians are no strangers to the U.S. economy and tourist sector, particularly in Florida. Florida is the top U.S. vacation destination for Brazilians – they outnumbered all other international travelers to Florida in 2011, up 41% from the previous year, according to state tourism officials.[6] Brazilians have also been buying up real estate in Florida – and many other parts of the country – for many years now, and many have already made the move north.
Based on e-Council Inc.’s experience, Brazilian investors tend to prefer EB-5 Direct Investment opportunities, particularly in franchise businesses. The investment and job-creation requirements associated with the EB-5 visa[7] can be met by directly purchasing a franchise unit, which generally has a pre-determined cost for construction and start-up as well as a minimum number of jobs required for operation. Opening a franchise can be an ideal option for Brazilian applicants who are looking to invest directly but who lack the entrepreneurial know-how to launch a business from scratch or purchase and run an existing business – particularly on “foreign” soil in the U.S. Franchise chains—e.g. YoBlendz, Elements Therapeutic Massage, Subway, Meineke, and Battery Giant—offer an established business model with a proven track record. To read more about the pros and cons of buying a franchise as an EB-5, read our helpful blog article here.
Notably, some franchise opportunities are also offered through regional centers, which are more passive in nature. The choice of whether the franchise option will be pursued directly or through a Regional Center will depend on the specific investor’s profile, goals, and interest in being directly involved in the operations of the business (direct) vs. a truly passive investment (Regional Center).
e-Council Inc.com can guide Brazilian investors in identifying the right investment opportunity for EB-5, particularly with the help of our network of carefully selected strategic partners, and our close ties with Brazil. Once the appropriate project and EB-5 track (direct vs. regional center) are chosen, e-Council Inc.’s team of experienced professionals and partners will develop and compile all of the necessary documents and reports required for USCIS submission. Most importantly, we will create a Matter of Ho-compliant business plan[8] that has the best possible chance of passing USCIS’ strict scrutiny.
To inquire about our turnkey EB-5 services such as our best-in-class Matter of Ho-compliant business plans, project assessment and ancillary services, please contact us at info@ecouncilinc.com.
e-Council Inc.’s website, newsletter and other forms of communication contain general information about legal matters. The information is not legal advice and should not be treated as such. You must not rely on the information on this website as an alternative to legal advice from an attorney or other professional legal services provider. For specific questions about any legal matter please consult with an attorney or other professional services provider.
[1] The E-2 visa allows a national of a country with which the U.S. maintains a Treaty of Bilateral Investment to be admitted to the U.S. when investing a “substantial” amount of capital in a U.S. business. Brazilians may, however, be eligible for an E-2 visa if he/she also holds a passport from another country with which the US has entered into such Treaty.
[2] See USCIS’ list of Treaty Countries, here: http://travel.state.gov/content/visas/english/fees/treaty.html
[3] http://travel.state.gov/content/dam/visas/Statistics/Immigrant-Statistics/China%20Employment%20Fifth%20Preference.pdf
[4] http://travel.state.gov/content/dam/visas/Statistics/AnnualReports/FY2013AnnualReport/FY13AnnualReport-TableV-PartIII.pdf
[5] http://travel.state.gov/content/dam/visas/Statistics/AnnualReports/FY2014AnnualReport/FY14AnnualReport-TableV-PartIII.pdf
[6] http://www.cnn.com/2012/01/24/travel/brazilian-tourist-invasion/
[7] EB-5 investments require a minimum of $1 million—or $500,000 in a Targeted Employment Area (“TEA”)—and the creation of ten full-time jobs within two years of an investor’s obtaining lawful permanent residency.
[8] Matter of Ho is a 1998 precedent decision issued by the Administrative Appeals Office that set forth the requirements for an EB-5 compliant business plan.