Investor Visa Application

Biden Administration Confirms Trump-Era Changes to EB-5 Investor Visa

The Biden Administration has moved to quash a lawsuit brought about by an EB-5 Regional Center that questioned the validity of changes to the EB-5 Investor Visa Program introduced in November 2019. By ratifying the changes, the Secretary of Homeland Security Alejandro Mayorkas puts an end to any speculation that the minimum investment level for the EB-5 Visa could be reduced back to $500,000 from the current $900,000.

Court Case

The principle line of argument in the court case was that the head of the Department for Homeland Security at the time had not been properly appointed. The then Acting Secretary, Kevin McAleenan, assumed leadership for the Department following the departure of Kirstjen Nielsen earlier in 2019.

The Government Accountability Office (GAO) released a decision on this issue last summer stating that McAleenan was not in the line of succession and that his leadership was therefore invalid. Mayorkas acted to re-ratify the changes to ward off any uncertainty – going forwards at least.

Old EB-5 Regulations

If it had been successful, the case could have forced a return to the pre-November 2019 regulations. This not only included the lower investment amount, but also different rules surrounding what governs a Targeted Employment Area (TEA). These are zones that qualify for a lower EB-5 investment level because they have weaker employment levels. Outside of TEAs, the minimum EB-5 investment level is $1.8 million (or $1 million prior to November 2019).

The increased investment amount since November 2019 has pushed the EB-5 Investor Visa out of reach of many potential investors . Many of these clients have shifted their interest in the US to the E-2 Treaty Investor Visa, which has lower investment amounts. There is no fixed investment level for an E-2 Visa, but it must be appropriate for the business being invested in and generally starts from around $100,000.

Upcoming EB-5 Reauthorization

A reversal to the EB-5 rule change would have been short-lived in any case. The EB-5 Regional Center Program is facing reauthorization in Congress before the end of this quarter (June 30). We are confident that Congress will support a long term reauthorization of a reformed program since EB-5 is responsible for creating so much employment and investment all across America.

An EB-5 reform bill introduced jointly by Senior Democrat, Patrick Leahy, and a senior Republican, Chuck Grassley aims to reauthorize the program through to 2026 and make reforms to ensure high standards are met by EB-5 Regional Centers.

Despite some uncertainty over the next few months, the future of the EB-5 program looks strong. It played a valuable role in helping America recover from the 2007/8 financial crisis and can support the economic recovery following the Covid-19 pandemic. EB-5 has brought in millions of dollars in foreign investment and has created hundreds of thousands of jobs all around the country. All at no cost to the US taxpayer.

What is the EB-5 Investor Visa?

The EB-5 remains a fast route to a Green Card (except for people born in mainland China who face delays because of strong historic demand). A single investment can cover a qualifying family unit (applicant, spouse, children under the age of 21). It is important to work with an immigration attorney from the outset of the process. One of the most complicated aspects of an EB-5 application is proving that your investment funds came from legitimate sources.

At Davies & Associates we support each EB-5 client with a strong and talented team, which includes not only immigration attorneys, but also tax lawyers, and accountants who can advise on remittance laws in your home country. Green Card holders are subject to tax on worldwide earnings, so it is important to understand and plan for this at the outset of the process.

Read more about EB-5 Investor Visas


This article is published for clients, friends and other interested visitors for information purposes only. The contents of the article do not constitute legal advice and do not necessarily reflect the opinions of Davies & Associates or any of its attorneys, staff or clients. External links are not an endorsement of the content.


Investor Visa Application

EB-5 Visa: Lawsuit Seeks to Overturn Investment-Level Increase

A lawsuit filed by an EB-5 Regional Center is taking aim at the November 2019 price hike for the EB-5 Investor Visa. If successful, the minimum investment amount for EB-5 would return to USD 500,000 in a Targeted Employment Area. A federal judge in California has indicated she may be willing to reverse the Trump-Era changes to the EB-5 program rules after a lawsuit filed by Behring Regional Center. 

If successful, any changes would likely be short-lived. The EB-5 Regional Center Program is set to expire at the end of June and a reform and reauthorization proposal has started working its way through Congress could set the USD 900,000 minimum investment level in stone.  It is our opinion that the new EB-5 law in June would be revised to increase the price back to itS current level.

This means that there may be an extremely short window of time, possibly as little as days, in which to file an EB-5 I-526 Petition at USD 500,000.   Properly preparing a case to be filed can take weeks or longer depending on where the funds are coming from and will require investors to fund an EB-5 project which is configured to accept investment at that investment level.  Any investor potentially interested in availing themselves of the USD 500,000 investment level should therefore have their case ready so it can be filed at a moment’s notice.  

The minimum investment requirement for the EB-5 Investor Visa to USD 900,000 in November 2019 to take account of inflation since the program’s inception in the 1990s. The $900,000 amount relates to investments in a Targeted Employment Area (TEA) – areas with relatively high unemployment. Outside of TEAs the minimum investment requirement rose from USD 1 million to UDS 1.8 million. The November-2019 rule change also centralised decision making around what constitutes a TEA, transferring authority for this to the Department for Homeland Security.

The rule changes had a significant impact on EB-5 uptake with a sharp drop-off after November 2019. This was partly due to so many people rushing to apply, exhausting pent up demand. Covid slowed the recovery, but green shoots have been emerging as the pandemic recedes. Long term reform and reauthorization in June will provide much-needed certainty and confidence to future investors. 

This federal court case could change calculations for some investors. If the price temporarily drops to USD 500,000 it could cause a massive rush to file EB-5 applications. The application process requires careful documentation of the source of funds used for the EB-5 investment. This can take time to prepare, so anyone considering an application or monitoring this court case for a drop in the investment level should contact us immediately. 

The court case comes at a time of brief uncertainty for the EB-5 Investor Visa Program. With reauthorization of the Regional Center Program required before the it expires in June, would-be investors need to weigh their options carefully. 

On the one hand, you could tie up your capital under uncertain conditions to pursue the EB-5 Regional Center in case it ends forever in June. Or on the other hand, you could wait until there is certainty in the second half of 2021, but know that the price of that certainty could mean the EB-5 route is closed to you forever. The risk is up to the client, but it is worth talking through your options with an immigration attorney. 

The likelihood is that the program will be renewed. The EB-5 Investor Visa brings in millions of dollars in investment and creates hundreds of thousands of jobs all across America at no cost to the taxpayer. It played a valuable role in America’s recovery from the 2008 financial crisis and could do something similar as the US economy recovers from Covid.

Anyone who has already applied for an EB-5 Visa but is waiting an adjudication may wish to file a writ of mandamus in federal court ahead of the June 2021 expiry date. Usually applicants should wait at least two years before resorting to legal action against the United States Citizenship & Immigration Services (USCIS), but the June expiration may change this. Contact us to discuss your specific circumstances.


Investor Visa Application

EB-5 Investor Visa Reauthorization in June 2021. What you need to know.




The EB-5 Regional Center program is facing reauthorization in June 2021. This has resulted in some uncertainty for current and future clients. Although we do not predict issues for people who file before June 30, there are ways to mitigate your risk:


1. If you are a D&A client, your case was recently approved and you reside outside of the US, we have already contacted the EB-5 unit at USCIS asking them to expedite the transfer of your file to the NVC so that visa processing can begin as soon as possible 

2. If your case was recently approved and you live in the US, we should file your Adjustment of Status application as soon as possible  

3. If your Form I-526 petition is still pending, you may wish to consider a Writ of Mandamus (more on this below)

Click here to learn more about the EB-5 Investor Visa
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Background to Current EB-5 Situation

The EB-5 Regional Center program is currently authorized on a temporary basis.  This means that the program is authorized for a discrete period of time and then it expires unless the temporary authorization is extended.

The EB-5 RC Program is currently authorized through June 30, 2021.  This June 30 date is different than those prior authorization end dates because this is the first time that the EB-5  Program authorization is not tied in with the Federal budget appropriations bill.  In the past, when the budget bill would pass, it would mean the EB-5 RC Program would automatically be extended.  In December 2019 Congress decoupled the EB-5 RC Program authorization from the budget, so that means Congress needs to pass a separate bill to extend the EB-5 RC program.  
 
Senators Grassley and Leahy have a bill drafted that will extend the EB-5 RC Program permanently but it will need receive the approval votes of a majority of Senators to pass.  We are optimistic that it will pass in some format and thus there will be no interruption in the EB-5 RC Program.  However, until it passes, there is obviously some uncertainty on what might happen after June 30.  

USCIS has not given any clarity about what will happen (1) if there is a gap between June 30 and when a new EB-5 RC law is passed or (2) if Congress never passes a new EB-5 RC law and the EB-5 RC Program authorization permanently expires on June 30.  

Our View on Reauthorization of EB-5 RC Program

We are optimistic that in the scenario where there is a gap in time between June 30 and when a new law is passed it will not impact any EB-5 petitions that were filed prior to June 30, 2021.  There have been periods of time in the past when the federal budget did not pass in a timely manner and thus the EB-5 RC Program experienced short periods when it was unauthorized—those short periods of time when the EB-5 RC Program experienced a gap in authorization did not have any impact on the EB-5 applications that were pending with USCIS at the time.  We are also optimistic that even in the unlikely event that Congress never passes a new law that reauthorizes the EB-5 RC Program that USCIS will continue to process all EB-5 related benefits for those who had pending or approved Form I-526 petitions as of June 30.

IIUSA’s View on EB-5 RC Program Reauthorization

In the last two weeks a well-known and respected EB-5 lawyer presented IIUSA’s view on the EB-5 RC Program reauthorization. This view is that if the EB-5 Regional Center Program is not reauthorized, then anyone who is not in the United States on a “conditional green card” on June 30, 2021 will have their EB-5 application terminated and will then have to re-apply all over again (probably with fresh funds) if and when the program comes-back.

How This Impacts My Case

1.         What if I have not filed my EB-5 petition (I-526) before June 30, 2021?:

If the program is allowed to expire in June 2021, then you will be unable to obtain a U.S. green card through the EB-5 RC Program and you would have to wait to see if the EB-5 RC Program is brought back in the future.


2.         I have filed an I-526 but it is awaiting adjudication:

Although the risk may be small, under the IIUSA view your case would be terminated and you would have to make a fresh application in a new project in the future.



3.         I have an I-526 approval but I am awaiting a consular interview:

In this circumstance we believe that the risk to you is lower, although under the strict IIUSA view your case would still be terminated.
 

Writ of Mandamus

 If your Form I-526 petition is still pending, you may want to file a complaint against USCIS in Federal court as soon as possible to ask the court to issue a Writ of Mandamus (WoM) that will order USCIS to make a speedy decision on your case.  Please contact us if you would like to discuss this Writ of Mandamus option further.

While our firm has traditionally counselled clients that there is no guarantee with a WoM and that filing a WoM may in fact have no impact on their I-526 case until the I-526 filing has been pending for two years, the June 2021 reauthorization issue changes our views of the risks involved. Please note, filing a WOM requires an additional fee to be paid. 


Please note, EB-5 applications related to direct investment in a company (meaning NOT done through a Regional Center) are not impacted at all by this June 30 reauthorization date.Copyright © *2020* *Davies & Associates*, All rights reserved.


 This article is published for clients, friends and other interested visitors for information purposes only. The contents of the article do not constitute legal advice and do not necessarily reflect the opinions of Davies & Associates or any of its attorneys, staff or clients. External links are not an endorsement of the content.