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Must be in the same location as yourself. Steam family is strictly for same house game sharing only.
Any attempts to bypass this could be met with a ban, so don’t.
All the family system requires is that the people getting invited at least ONCE logged in at the same location, thats it.
So OP, you and your family member just need to login to the same PC with your Steam accounts right after each other, then send out the invite.
It will now work. After that it does not matter from where your family members login as long as its the same country.
And its definitely not "bannable" to do this, i been giving this advise for over a year on the Steam Families subforum and even had Valve mods pin that answer in threads as the correct solution.
Steam just wants to make sure you actually know the people you are sharing with in real life, which you proof with the " both login to the same PC" method.