The biggest question in the EB-5 industry is how do you structure an EB-5 investment? Traditionally, the EB-5 immigrant investor program has been utilized by adults to apply for immigrant status in the U.S.. However, if prospective EB-5 investors hope to secure U.S. permanent residence for their children, and if those children may reach the age of majority before the visa becomes available (which, given the current backlogs, is becoming increasingly common), it may be advantageous to file the petition under the child’s name instead. Last year, the United States Citizenship and Immigration Services (USCIS) clarified that minor children can file EB-5 petitions on their own behalf, provided they have entered into a “valid investment contract” that is “not voidable.”

The challenge, of course, then becomes to legally structure an EB-5 investment, in the minor’s name, in a way that is considered valid and cannot be voided by the child when he or she reaches adulthood (as is typically the case with contracts entered into by minors). In Using the Uniform Transfers to Minors Act for Minor Investors in EB-5 Investment Funds, Catherine DeBono Holmes and Daniel B. Lundy outline a creative solution that allows minors to act as EB-5 investors and file their own EB-5 petitions with USCIS.

This article provides a detailed analysis of the Uniform Transfers to Minors Act (UTMA), its application in different states, and how to draft an investment contract that is not voidable for immigration purposes. It goes so far as to suggest the precise language to include in contracts to ensure investments are governed by the UTMA in individual states, and it addresses how to deal with minor investors who live outside of the U.S. at the time of the investment.

The authors provide comprehensive legal advice on this creative option for allowing minors to act as EB-5 investors, and offer specific details on the following:

  • Which U.S. States follow the UTMA
  • How investment funds are treated under the UTMA
  • The role of a custodian in UTMA investments
  • How to make a minor investment contract non-voidable

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Read Using the Uniform Transfers to Minors Act for Minor Investors in EB-5 Investment Funds by downloading the full eBook, Insights from Experts: Medallion Partners Cover Hot Industry Topics.

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