September News From Trow & Rahal, P.C.

We are honored to announce that Steve Trow, Linda Rahal, and Cynthia Hemphill, the shareholders of Trow & Rahal, P.C., have each been selected by their peers to be included in the 2011 edition of The Best Lawyers in America® in the practice area of Immigration Law.

Inclusion in Best Lawyers is based on an exhaustive and rigorous peer-review survey comprising more than 3.1 million confidential evaluations.

Because no fee or purchase is allowed, being listed in Best Lawyers is considered a singular honor. The annual, advertisement-free publication has been described by The American Lawyer as "the most respected referral list of attorneys in practice." We are incredibly proud to be included.

And just this week, we got the good news that we are one of the country's 2010 Best Law Firms. The list will be published in the October issue of U.S.News & World Report: www.usnews.com.

Also this month: Steve Trow traveled to Switzerland to speak at the Association of Foreign Banks in Switzerland Conference in Geneva (on Sept. 8) and in Zurich (on Sept. 9). The topic of the conference was "FATCA: first set of guidance for implementation."

Steve addressed U.S. immigration rules that determine whether an individual is a U.S. citizen or has U.S. permanent resident (green card) status. This is not always clear, as a person may be unaware that he is a U.S. citizen or may mistakenly think that he has lost U.S. citizenship by acquiring another nationality or lost permanent resident status by residing abroad. Click here to view the agenda for the conference.

Steve's next speaking engagement is October 26: He will travel to Calgary to conduct a four-hour presentation for Moodys Tax Seminars. The topic is "U.S. Immigration and Citizenship Planning for High Net Worth Clients." Learn more about that here.

In this issue: You'll learn about the EB-5 Immigrant Investor Program, which allows foreign investors and their families to obtain U.S. permanent resident status (green cards) to reside permanently in the United States. Read all about that, below.

Immigration Update: Don't miss the insights we share in our immigration news briefs. Specifically, take a look at the higher filing fees that will be required for companies with a large H-1B/L-1 workforce.

All of us at Trow & Rahal are available to help you with your immigration-related needs. We look forward to working with you.

Steve Trow, Attorney / Owner / Founder, strow@trowlaw.com
Linda Rahal, Attorney / Owner / Founder, lrahal@trowlaw.com
Cynthia Hemphill, Attorney / Owner, chemphill@trowlaw.com

Understanding the EB-5 Immigrant Investor Program

By Steve Trow
Attorney / Owner / Founder
Trow & Rahal, P.C.

Getting a green card can be a long and frustrating journey for many applicants. Most will need a sponsor – a U.S. employer with a full-time job offer or a close family member who is a U.S. citizen or permanent resident.

Most job-based applicants will need labor certification – an arduous process to prove that there are no U.S. workers who can do the job. Labor certification takes one to three years, and in the current job market the outcome is highly uncertain.

There is a limited annual supply of green cards, with long backlogs for many applicants – six to eight years for skilled workers and professionals, five to eight years for adult sons and daughters of U.S. citizens, and nine years for brothers and sisters of U.S. citizens.

Fortunately, there is a way to get a green card that does not require a sponsor or labor certification and can be completed in about a year – the EB-5 visa for immigrant investors.

This visa is available to foreign nationals who invest money in a U.S. business and create or preserve jobs for U.S. workers. To obtain an EB-5 visa, an applicant must invest at least $500,000 and create or preserve at least 10 jobs for U.S. workers. The investor's spouse and unmarried children can obtain EB-5 visas based on the same investment.

The Three-Step Process

There are three steps required to obtain a permanent green card based on investment. After completion of step two, the investor will receive a conditional green card valid for two years. Once step three is complete, the investor will receive a permanent green card.

Step 1: Filing Proof of the Qualifying Investment and Source of Investment Funds

In order to qualify for a green card through investment, an investor must file Form I-526 (Immigrant Petition by Alien Entrepreneur) with the U.S. Citizenship and Immigration Services (USCIS) with evidence that he or she has invested or has committed to invest equity capital into a commercial enterprise in the United States.

• The minimum investment amount is $1,000,000, but this amount is reduced to $500,000 if the commercial enterprise is located in a rural area or a high unemployment area. The investor must show that he or she obtained the investment funds lawfully through employment, investment, gift, inheritance, or other means.
• The investor must also show that the investment will create or preserve at least 10 full-time jobs for U.S. workers.
• Depending upon the investor's personal preference, the investor may be actively engaged in the management of the U.S. business or may be a limited partner who is not involved in day-to-day management of the business.
• The investor may start or purchase a U.S. business as the sole owner of the business, or invest as co-owner with other U.S. or foreign investors, or invest through a regional center that combines the investment capital of multiple foreign investors into a single business enterprise or multiple enterprises.
• Investors who participate in regional center projects are permitted to show that their investment has created or preserved jobs indirectly in the regional economy, while other investors must show that their investment has created or preserved jobs directly on the payroll of the business enterprise in which they invest.

Step 2: Obtaining the Two-Year Conditional Green Card

Once USCIS has approved the Form I-526 petition, the investor moves on to the second step in the green card process. The second step allows the investor (and the investor's spouse and any unmarried children under the age of 21) to obtain the conditional green card.

• Prior to beginning this step, the investor makes a choice either to obtain the green card by applying in the U.S. through an adjustment of status application (if the investor is already in the U.S. in lawful temporary visa status) or to obtain the green card by applying for an immigrant visa at a U.S. Consulate abroad.
• Both processes require medical exams, criminal record checks, and documents such as birth and marriage certificates.
• After the adjustment of status application is approved by USCIS in the United States, or after the U.S. Consulate approves the immigrant visa application, the investor and the investor's spouse and unmarried children under the age of 21 will receive conditional green cards valid for two years.

Step 3: Obtaining Permanent Resident Status

• Prior to the end of the two-year period of the conditional green card, the investor must apply for permanent residence by submitting Form I-829 (Petition by Entrepreneur to Remove Conditions) to USCIS along with evidence that the investor has actually invested the required amount of capital in a commercial enterprise; that the investment was sustained for a two-year period; and that the enterprise created or preserved at least 10 full-time jobs for U.S. workers.
• After approval of this step, the investor and family are granted permanent resident status.

Optional Step 4: Obtaining U.S. Citizenship

• On the fifth anniversary of obtaining Conditional Resident status, the investor and family may become eligible to apply for U.S. citizenship.
• To become eligible for U.S. citizenship, the investor or family member must maintain his primary residence in the United States for five years, and must be physically present in the United States at least half of the days during this five-year period.
• There is no requirement to apply for U.S. citizenship; the immigrant investor or family member may choose to remain in Permanent Resident status indefinitely.

Who Should Consider Getting an EB-5 Visa?

EB-5 can work for almost anyone who has $500,000 to invest or who can obtain the necessary funds through a gift or a loan.

Some examples include:

• Families from countries with civil strife, high crime, or political repression
• Retirees who do not want to work in the U.S. or who only want to work part-time
• Entrepreneurs who want to start a U.S. business, particularly those from countries that are not eligible for E-2 (treaty investor) nonimmigrant visas
• Employees in E, H, L, or other nonimmigrant visa status whose employer will not sponsor them or who have been sponsored but are stuck in long backlogs
• Recent graduates of U.S. universities who do not have a U.S. job offer, or may not succeed with labor certification, or do not want to be tied to a particular employer
• College students who cannot qualify for reduced in-state tuition while holding F-1 or J-1 visa status, and spouses in F-2 visa status who want to work
• Parents who want to reside in the U.S. while their children attend school here
• Spouses and parents of permanent residents
• Adult sons and daughters of U.S. citizens
• Brothers and sisters of U.S. citizens
• Other relatives for whom there is no green card category
• Non-spouse partners and same-sex partners of U.S. citizens or residents – federal immigration law does not recognize same-sex marriages even when states do
• A person who needs long-term medical treatment in the U.S.

To get the EB-5 process started, schedule a consultation with Steve Trow by email: strow@trowlaw.com or by phone: 202-537-4830.

Smartsoft International Pays Nearly $1 Million in Back Wages to H-1B Employees

Smartsoft International Inc., a computer consulting company based in Suwanee, Georgia, has agreed to pay nearly $1 million in back wages and interest to 135 workers employed by the company under the H-1B visa program, the Department of Labor (DOL) announced on August 17, 2010.

The DOL's Office of the Solicitor reached the agreement following a determination by the Wage and Hour Division that the company violated the H-1B program's rules. Smartsoft also has U.S. offices in Sunnyvale, California, and North Brunswick, New Jersey.

The issue was that some H-1B employees were not paid any wages at the beginning of their H-1B employment, were paid on a part-time basis despite being hired under a full-time employment agreement, and were paid less than the prevailing wage applicable to the geographic locations where they performed their work.

The company contested the Wage and Hour Division's conclusions and requested a formal hearing with the DOL's Office of Administrative Law Judges. As part of the agreement, the company will drop any further challenges.

The DOL announcement is available here.

Immigration Update: September 2010

Note: Where USCIS appears in our newsletter, it refers to U.S. Citizenship and Immigration Services.

Higher Filing Fees for Companies With a Large H-1B/L-1 Workforce

On August 13, 2010, President Obama signed Public Law 111-230, a new border enforcement-funding law, which contains provisions to increase fees for certain H-1B and L-1 visa petitions.

The law focuses on companies with more than 50 employees and a workforce comprising more than 50% of individuals with H-1B or L-1 status.

As of August 14, 2010, if this 50/50 rule applies to a company, the company will be required to pay an additional fee of $2,250 for L-1 visa petitions and $2,000 for H-1B visa petitions. This makes the total fee $4,320 for an H-1B visa petition and $3,070 for an L-1 visa petition – plus an additional $1,000 filing fee for expedited processing.

USCIS is in the process of revising the Petition for Nonimmigrant Worker (I-129) to indicate a new attestation whether a company is subject to Public Law 111-230.

Take note: In the meantime, USCIS instructs all H-1B and L-1 visa petitions to indicate in a cover letter whether they are subject to the law.

Also, it is likely that the USCIS will issue a Request for Evidence (RFE) to determine whether an H-1B or L-1 visa petition is covered by the public law if it is not indicated when filed. An RFE may be required even if such evidence is submitted, if questions remain.

Update on Recruitment Evidence Required for PERM Applications

On August 3, 2010, the Department of Labor's (DOL) Office of Foreign Labor Certification released FAQs to clarify some requirements for PERM labor certification filings. One key topic included in this FAQ is the documentation that the DOL is requiring for evidence that a company used its Employment Referral Program as one of the recruitment tools for labor certification (PERM) applications. It is the first time DOL has made this clarification since implementing the PERM system in 2006.

DOL is now requiring additional evidence when the company uses its employee referral program as one of the three additional sources of recruitment.

In the past, employers would include a copy of the company's written policy in the PERM audit file as documentation that it was used as a recruitment tool. Now DOL also requires companies to submit documentation that it communicated to employees that the Employee Referral Program was available for the specific position on which the PERM application is based.

The DOL will accept a posting on the employer's internal Web site or other evidence linking the Employee Referral Program to the PERM position. The Notice of Posting is not sufficient for this purpose.

New fee for ESTA applications when traveling on Visa Waiver Program

On March 4, 2010, new fees were established for Electronic System for Travel Authorization (ESTA) applications when President Obama signed into law the Travel Promotion Act (TPA).

Visitors to the U.S. using the visa waiver program are required to complete ESTA applications before traveling to the U.S. The new ESTA fee of $14 consists of a $10 fee increase under TPA, and $4 to cover the administrative costs of operating ESTA. The new fee went into effect on September 8.

Companies Filing H-1B or L-1 Visa Petitions for the First Time Should Expect Random Calls to Verify Information

When an H-1B or L-1 visa petition is filed with USCIS, a second copy of the petition filing is sent to the Kentucky Consular Center (KCC) to generate a Petition Information Management Service (PIMS) record in the Consular Consolidated Database.

According to the Department of State, PIMS is the primary source of evidence used by consular officers to verify the approval of a nonimmigrant visa petition. Showing an original approval notice, without confirmation in PIMS, is not sufficient for a U.S. Consulate to issue a visa.

Recently, KCC started to create a "base petitioner record" for all companies filing an H-1B or L-1 visa petition for the first time. In it, KCC verifies the information contained in the petition, including a review of a company's Web site, company contact information, and use of Google Earth to confirm that an office exists in the reported physical location. Once the base petitioner record is complete, KCC will not normally re-verify the petitioner information for two years.

Take note: In addition, KCC representatives are calling companies to verify information related to beneficiaries and proposed U.S. employment. The calls will be made randomly and without notice shortly after the petition from USCIS is received.

It is possible that this extra verification through random and unannounced telephone calls will slow down the notification through PIMS to the U.S. Consulate, thereby causing delays in visa issuance.

CBP Clarifies TN Extensions of Stay While Immigrant Petition Is Pending/Approved

A letter from April 21, 2008 was recently released from U.S. Customs and Border Protection (CBP), which clarifies that Trade NAFTA (TN) applicants may be admitted to the U.S. or have their TN status extended even if an immigrant petition (I-140) is pending or has been approved.

However, the TN applicant cannot have an application to adjust status pending (Form I-485), or have had an immigrant visa interview. The CBP letter notes that once an adjustment of status application is filed, the TN applicant is no longer eligible for admission into the U.S. or for an extension of stay as a TN nonimmigrant.

This CBP letter confirms a policy that was previously instituted by the legacy department of Immigration and Naturalization Service, which has not always been followed.

Click here to view the 2008 CBP letter.