Investment of Capital Requirements

-- By Mugg & Tang, LLP

How to satisfy the investment of capital requirement is a key element to get the approval of investment-based immigration petitions.

In terms of the cases Mugg & Tang, LLP handled, the USCIS considers that “investment” means contribution of capital. A debt financing arrangement between the alien and the business in which the alien is acting solely as a creditor does not constitute a contribution of capital if the “investment” is made in the form of a loan to the company. For instance, a contribution of capital in exchange for a note, bond, convertible debt, obligation, or any other debt arrangement between the alien entrepreneur and the commercial enterprise is not a qualifying investment.

Under the USCIS rule, “capital” includes the following: cash, cash equivalents (such as certificates of deposit, treasury bonds, or other instruments that can be converted readily into cash), equipment, inventory, other tangible property, indebtedness secured by assets owned by the alien, e.g., a promissory note made out by the alien and payable to the commercial enterprise (provided the alien is directly and personally liable and the assets of the enterprise are not used to secure the debt).

In addition, a mere intent to invest, or prospective investment arrangements entailing no present commitment will not suffice to establish that the petitioner is actively in the process of investing. To demonstrate actual commitment of the required amount of capital, we always advised our clients to deposit money, purchase assets, transfer assets and so forth to make sure that the investment of capital requirements would be satisfied.