Analysis of Advantages and Disadvantages of Regional Center

Due to the high risk of EB-5 immigrant visa, before 2008, 10000 visa quota can only attract less than 1000 applicants. In order to attract more overseas assets, the U.S. government launched a pilot program of regional centers. The "regional center" is actually a commercial center built in the United States for investment by immigrants. Such a commercial center needs government approval to provide more preferential policies for EB-5 investment immigrants. Because this kind of immigration scheme is more popular, it has the lowest requirements for applicants' language and management ability, and the applicants account for the largest proportion, which has become the main business of immigration agencies.

The regional center migration plan has the following advantages:

The investment threshold of the regional center is only 500,000 US dollars. If the investment manager is competent, he can save a lot of energy and time. Immigration does not require investors to participate in daily management, which is one of the biggest differences with other investment models. Investors only need to invest money and don't need to live in or near the regional center. Investors don't have to worry about the management office, they can manage other businesses or study with peace of mind. When the Immigration Bureau examines the investment effect of EB-5 applicants two years later to decide whether to issue them permanent green cards, it will not only consider creating employment opportunities directly, but also indirectly. EB-5 applicants only need to obtain the information provided by the regional center to prove that the goal of creating employment opportunities has been achieved, and the immigration bureau can recognize it. Of course, the relocation of regional centers is not perfect, and there are also many uncertain factors that lead to high risks, which are embodied in the following aspects:

Investment is usually carried out in the form of limited partnership, and a single applicant only accounts for a small share and has no management right to the enterprise. Once the regional center does not operate according to the business plan, it is difficult to negotiate with the regional center manager through voting, decision-making and other management means; Most of the operators of regional centers are not experienced asset managers, but some businessmen or former government employees who lack investment experience, so they can't provide the same rate of return as PE investment managers, and powerful PE investment managers won't spend too much time doing business in regional centers. Before contacting the potential project sponsors, the regional center operators have not got the funds, so they need to persuade the project sponsors to agree to help them start the targeted EB-5 investment fund. If the project funds are already in place, the project sponsors will not choose the regional center at all, and only projects without funds can turn to the regional center to recruit investors overseas. In addition, the Immigration Bureau requires investors to bear considerable investment risks, and the regional center can only choose projects in underdeveloped areas, and it is still uncertain whether it can raise money. In this case, the chips are small and it is difficult to get high-quality potential projects. The reason is simple: low-risk and feasible project banks have provided loans; After the potential immigrant investors pay the money to the immigration agency, the agency fee will not be refunded, and they can only choose other regional center projects recommended by the immigration agency. So far, there are more than 220 regional centers and more than 300 projects in the United States. Investors can only choose their own selected immigration intermediary projects, and immigration intermediaries will only provide signed projects. Although immigration agents will also be screened, they are not professional investment institutions and cannot assess project risks; When the project starts, there are the following risks (1). If enough investors are not recruited, the project cannot be carried out. (2) the operator is unwilling to do it for some reason; (3) The funds of other parts of the project are not in place; (4) The Immigration Bureau has revised some other judgments (the Immigration Bureau has the discretion of pre-approval before reversing the case); (5) Investors can't prove the legitimacy of income sources; (6) The Immigration Bureau has the right to modify the economic model of indirect employment opportunities, so that the number of employed people will not be recognized in the end; There are different types of risks at different stages of the project. The financial return of the regional center needs the success of the project. No project has a six-year construction period, so the average project takes several years. If the construction period is completed, the project will have no construction period risk, and the operation period risk will follow. We have studied many projects of 10, and these projects all have certain operational risks. For example, there is a project to invest in a 4D cinema in Broadway, New York, which requires EB-5 investors to contribute 70 million US dollars. Pledge has no property, only cinema facilities. According to the business plan, the risk faced by the project during its operation is to bet whether tourists will spend $28 to watch a 4D movie for more than 50 minutes. Basically, every amusement park has free 4D movies. Based on our judgment, the risk during the operation period is high; The fund lock-up period of regional center projects is longer than that of direct investment. The regional center project needs an investment period of 5-6 years, plus the capital waiting period from the first half of the year to 1 year, which is equivalent to a lock-in period of 7 years, while the direct investment only needs an assessment period of 2 years. Secondly, the regional center project can only be cleared once. If the standard is not met, investors can only go home, and direct investment has multiple application opportunities. If it does not meet the standards in some aspects, it can be revised immediately until it meets the standards. The regional center immigration program is most suitable for most applicants who have no management experience and no cooperative institutions in the United States, which is why this model is so popular. Although the regional center resettlement scheme has many advantages, the risk of this investment model is much higher than that of direct investment. Judging from the success rate of visas over the years, direct investment is much higher than that of regional centers. 20 1 1 Among the approved immigration projects, 8% of the applicants created 24% of the approved cases, while 92% of the applicants in the regional center only created 76% of the successful cases, and the failure rate of the regional center was three times that of the direct investment. Therefore, before deciding to invest, you must consult an experienced immigration lawyer in related fields. Whether it is the choice analysis of regional centers or the preparation of certification materials, a little carelessness may cause the applicant to lose time and money.