The U.S. Immigration & Naturalization Service is making itself available to help small businesses raise capital!  (Sure, sure: We're from the INS and we're here to help you.)  The INS will grant citizenship to the entire family of foreign investors who invest at least $1,000,000  and take an active interest in a small business that creates at least 10 new jobs over a two year period.  This minimum is reduced to $500,000 for rural areas, cities with a population of less than 20,000, Enterprise Zones, or areas of high unemployment.  The funds can be used to start a business, expand a business or save a failing business.   

 This was created by the U.S. Immigration Act of 1990, but the final rules were not approved until November 1991.  Less than 1,000 Employment Creation Immigrant Visas were granted during 1992, although up to 10,000 per year were allowed.  The major difficulty to implementing the program is U.S. entrepreneurs and foreign investors finding each other.  
  

Employment Creation Immigrant Visa - "Entrepreneurs Visa"  
 The newly created Employment Creation Immigrant Visa, that has become known as the "Entrepreneurs Visa" is available to almost any foreign buyer who invests $1 million and creates or saves 10 jobs. "The entrepreneur actually gets a ‘green card' for him and his family.  There is also the "E-2 visa, which is not a "green card' but is a non-immigrant, temporary visa issued for one year at a time to foreign investors who meet several criteria which include making "reasonable  amount" of dollar investment. Visas have been approved based upon an investment in the $100,000 -to- $150,000 range.  "As long as the business is active and the investor meets the criteria, the visa may be extended indefinitely.  Individuals interested in this type of immigrant visa should exercise due diligence and investigate any "quick and easy" schemes being offered for a sum of money significantly less that the statutory amount (note that while the entire amount need not be invested, the investor must be at risk for the entire  amount even though a smaller sum is actually invested).  

 The Immigration Act of 1990, Pub. L. 101-649 created this new visa category.  Its primary purpose is the creation of jobs and stimulation of the US economy.  Immigrant visas issued under this category are initially issued conditionally for a two year period.  Within 90 days of the second anniversary of being granted conditional resident status, the alien must affirmatively seek to remove  the conditional status.  
  

The Application Process  
 The first step is for the prospective immigrant investor to file a petition, requesting the INS make a determination that the petitioner has invested or is actively in the process of investing lawfully obtained capital in a new commercial enterprise in the United States which will create full-time positions for not fewer than 10 qualifying employees.  The timetable depends upon the individual petitioner and the backlogs experienced by the INS. The INS service centers report that they are "current" in this type of application; thus a 45- to 90-day timetable for approval of an immigrant investor petition might be expected unless there are problems with the application.  

 The administrative requirements for the documentation (articles of incorporation, certificate of merger or consolidation, partnership agreement, certified financial reports, stock purchase agreements, payroll records, etc.)are that it must be sufficient to support the petition, including the possible examination of investment income sources by the Internal Revenue Service.  It is possible to help this process along by calling on Congressional support, particularly if new jobs are involved.  

 Approval of the investor immigrant visa entitles the holder to a conditional permanent resident alien ("green card" holder) status for him and each member of his immediate family. The rule is that the investor must show that he has invested or is "actively in the process" of investing the required amount.  The INS defines "invest" as contributing capital.  A contribution in exchange for a note, bond, convertible debt, obligation, or any other debt arrangement between the alien entrepreneur and the US-based commercial enterprise does not constitute a contribution of capital.  The petitioner must show that the new commercial enterprise has been established, the required amount of capital has been transferred, and the investment has resulted in a substantial increase in the net worth or number of employees of the business (minimum 10 U.S. workers employed).  

 There are many ways to document what the INS wants, but the rule says the petitioner must provide evidence that the required amount of capital has been placed at risk for the purpose of generating a return on the capital placed at risk.  Evidence of mere intent to invest, or of prospective investment arrangements entailing no present commitment will not suffice to show that the petitioner is actively in the process of investing. The alien must show actual commitment of the required amount of capital.  This has sometimes been a problem: Prospective investors (whether large or small) want to know what they are getting for their money, and a "green card" is usually secondary to preserving their investment.  

 The good news is that the INS has approved limited partnerships that protect an applicant's investment capital while placing much less of it at risk until the INS approval process is completed. The entire amount must be put up, but as little as $100,000  might  be spent for investment research, setup costs, and professional fees to consultants, brokers and lawyers.  Once approval is received from the INS the remaining capital can be released by the applicant's partnership for the targeted investment.  

 Establishment of a new commercial enterprise may consist of (1) the creation of an original business, (2) the purchase of an existing business and simultaneous or subsequent restructuring or reorganization such that a new commercial enterprise results, or (3) the expansion of an existing business through the investment of the required amount, so that a substantial change in the net worth or number of employees results form the investment of capital.  Substantial change appears to mean a 40 percent increase either in the net worth, or in the number of employees, so the new net worth, or number of employees amounts to at least 140 percent of the pre-expansion net worth or number of employees. Other, less stringent, criteria apply to rescuing a business that is in financial trouble.  

Try the US Immigration & Naturalization Services' web page at:  http://www.ins.usdoj.gov