Can I invest in a family business where I am already a minority partner?

Investing in a family business in which you are already a minority partner may be possible, but it requires a careful compliance review under the EB-5 program. The program does not prohibit family-owned businesses, but it imposes conditions on the nature of the capital and on job creation that must be met in a clear and demonstrable way.

For the EB-5, the investment must be new, must be ‘at risk’ (subject to genuine risk), must come from a lawful source, and must be tied to the job creation required by the program. If the family business was not originally structured with that goal in mind, it may be necessary to reorganize the operation or to demonstrate, with solid documentation, how the capital infusion will generate those jobs.

The most sensitive point is usually the ‘newness’ of the capital. Because you already hold an ownership stake, authorities tend to examine whether the invested amount is genuinely new and additional, and not simply capital that was already in the business. The source of funds and the transparency of management are also part of that analysis.

• The investment must qualify as that of a ‘new commercial enterprise’ as defined by the program.
• Prior ownership requires demonstrating that the capital contribution is new and additional.
• Solid documentation of the source of funds carries significant weight in the review.

Before repurposing an existing family structure, map out each step of EB-5 compliance and confirm the current requirements with the USCIS or with a qualified specialist.

About the author

Victoria Harper

Editor-in-Chief

Meet the author

As a journalist and lead editor at Visto n’ Visa, Victoria helps ensure that immigration topics are covered in a clear, trustworthy, and easy-to-understand way. Her focus is on delivering useful, human, and relevant content for people exploring new paths abroad.