Ronaldo arrived in the US with a B1/B2 visitors visa. He used to be an employee of a prominent and wealthy businessman. After many years of earning profits from illicit activities, Ronaldo left his employer and went to the US. He has more than a million dollars in cash available for investment.
According to Ronaldo, his family’s safety is at risk and wants to settle in the United States for good. After consulting with legal counsel, Ronaldo was informed that even if he has possession of a significant amount of cash, he may still not qualify for the investors visa.
Thereafter, Ronaldo decided to just purchase real estate properties and returned to the Philippines. He continues to hold a visitors visa and goes to the US occasionally to look into his investment properties.
Two Types of Investors Visas
Investors visas may either be granted temporarily or on a permanent basis. The temporary investors visa is known as the E2 treaty investor nonimmigrant visa. The capitalization for this E2 visa is not defined in terms of an exact minimum amount. The statute merely requires a “substantial” investment to qualify.
Substantiality depends on the nature of the business. It must be sufficient to ensure the successful operation of the enterprise. The amount of investment for a low-cost business enterprise will necessarily be lower than the amount of investment in a high-cost enterprise. The E-2 investor must hold ownership of at least 50% of the business enterprise.
On the other hand, the permanent resident investors visa also known as the EB5 or the Employment Creation Greencard requires an investment of at least $1,000,000 or $500,000 depending on where the enterprise investment is located.
Both types of visas allow the investor as well as their spouse and minor children to reside in the United States. Spouses of E2 visa holders are also entitled to an employment authorization card while their children may legally study in US schools.
Legitimate Wealth Only
The pertinent regulations found in 8 CFR Section 204.6 (j)(3) is clear on the specific requirements on the source of capitalization for an investors visa. For a Filipino national, a petition for an investors visa must include the following proof to show that the capital used for the investment comes from a lawful source: (i) Philippine business registration records; (ii) Corporate, partnership and personal tax returns including income, franchise, property (whether real, personal, or intangible), or any other tax returns of any kind filed with in five years, with any taxing jurisdiction in or outside the United States by or on behalf of the petitioner; (iii) Evidence identifying any other source(s) of capital; or (iv) Certified copies of any judgments or evidence of all pending governmental civil or criminal actions, governmental administrative proceedings, and any private civil actions (pending or otherwise) involving monetary judgments against the petitioner from any court in or outside the United States with the past fifteen years.
Just like the case of Ronaldo above, possession of a significant amount of money is not enough. There must be proof that the capital was amassed in a legitimate way. However, it does not necessarily mean that the capital has to be from income earned through employment or business. It can also be shown that the capital was obtained by a loan or gift from a family member, by way of inheritance or even by lotto winnings.
Active vs Passive Investment
Obtaining an investors visa require the applicant to engage in an active investment and not a passive investment. The mere purchase of a real estate property will not qualify an individual for an investors visa. There are countries that do allow passive investments to qualify the applicant for an investors visa. However, the US does require that the investment be an active one before a visa is approved and issued.
There are undoubtedly individuals with substantial capital who merely wish to diversify their investments to real estate in the US with no intention whatsoever to live in the US. However, for individuals with intentions to seek for an investors visa to permanently live in the US, having “unexplained wealth” will not be sufficient. The source of the capital has to be documented.
(Tancinco may be reached at law@tancinco.com or at 02 8877177)
