1) What are the core criteria in choosing the right project for investment?
The project has to generate the required number of jobs so that the applicant can get his/her permanent residency in the United States. To ensure that they will receive their invested funds back, one should also be careful and choose a sound project. The developer, as well as the regional center behind the project, should have a clean record. They should have solid I-526 and I-829 approval records. Investors should find out whether they have returned any principal in their previous projects. These are experience-related checkpoints. When it comes to the project, we always prefer projects where all the financing is already in place. We like to ensure that the developer will complete the EB-5 project, even if they fail to raise some or most of the EB-5 funds. We also pay tremendous attention to the waterfall. We want to make sure that there is a senior loan. Even though it is ahead of the EB-5, it gives us comfort that an institutional money manager, bank, etc., has looked at the project and decided to fund it. If the project is good enough for the bank at, for example, a 60% LTV (loan to value) ratio, we reckon that it should be acceptable for our investors at a 75% LTV. If, on the other hand, no institutional money is touching the deal, even if the developer claims the EB-5 is ahead of everyone else in the waterfall, it is a red flag for us. In some seldom cases, we do seriously consider projects whereby the developer with outside assets guarantees the NCE loan to the JCE that would give indirect comfort of repayment of principal to the EB-5 investors.
2) Do Regional Centers have to use escrow when taking in EB-5 capital?
No, but as a best practice, it has become the expectation of both the investors and broker-dealers that there is an independent set of eyes making sure that disbursements are taking place following the PPM.
3) Are there any advantages in investing in public-private hybrid EB-5 projects as opposed to straight private ones?
In public-private projects, there is the involvement of a governmental entity. Therefore, there seems to be an impression out there that public-private projects are safer. This assessment is not necessarily the case. Among a whole host of other factors, the desirability of an EB-5 project depends on:
a) the ratio of equity to total capital stack needed for the project, that is the total spend;
b) the waterfall, that is the priority of payments for the EB-5 investors;
c) the existence or not of covenants that limit/restrict additional indebtedness;
d) the stage the project is – this would either increase or decrease the chance of reinvestment of the EB-5 funds.
4) How does one make sure to demonstrate that the project is in a Targeted Employment Area?
To demonstrate that your project is in a Targeted Employment Area, commonly known as TEA, you have to prove that either the project is in a rural area or in an area that has experienced unemployment of at least 150 percent of the national average rate. One good source to check for the unemployment rates is the list provided by the Bureau of Labor Statistics website if the project will be qualified as TEA through the high unemployment route.
5) If the EB-5 project the EB-5 investor invests in goes bankrupt, does that mean they can no longer get a green card through this petition?
It depends. The most important criterion here is whether the JCE created the requisite 10+ jobs per investor attributable to their investment. For example, your clients should have no issue provided the JCE filled all of the jobs and deployed all of the funds on the project. If the JCE did not fill the requisite jobs, or if they did not deploy all of the funds, then your clients might have an issue unless their attorney could argue that their funds went into the project to create the requisite ten jobs attributable to them.
6) If a project has I-924 exemplar approval, does that mean that it is credit risk-free?
No. The investment must be at risk. That is why investors have to be very careful when picking a project to invest in and do their due diligence. That is why working with a broker-dealer that performs due diligence becomes of utmost importance.
7) How does the return of the EB-5 investment mechanism work when the EB-5 investor chooses to invest through a Regional Center?
When you make an EB-5 investment through a Regional Center, you are purchasing a private placement in the form of equity. In other words, you are purchasing shares in an NCE. The NCE lends the funds it collects from all the investors to another legal entity called the JCE. The loan from the NCE to the JCE has a tenor, otherwise known as maturity. The JCE typically has a couple of (two or three) one-year extension rights when the loan is due. They would use this right if the project owner were not yet in a position to pay back the loan due to delays in construction, sales, or procurement of permanent financing. In most transactions, the JCE is ready to pay off the loan after the senior loan. The key is to understand that the NCE does not have any legal obligation to return the principal to the EB-5 investors. We are not aware of any case whereby the funds have been ready to be returned to the investors that the NCE has decided to hold the funds longer than necessary. Before the investor filing his I-829 petition, if the return of their principal would jeopardize their entire application, the NCE could hold on to or reinvest the funds in another project.
8) When checking the total capital stack of a project, how much EB-5 is too much, how much is too little? How much equity should be there providing a cushion for the EB-5? How about the senior debt? Is it better to have it ahead of the EB-5 in the waterfall? Is it better not to have senior debt at all?
The equity below the EB-5 in the capital stack should not be less than 20 percent. If it is, the developer is not putting in enough equity. Anytime the senior loan is above 60 percent, that could potentially be too much leverage. The typical capital stack is 60 percent senior debt, 20 percent EB-5 and 20 percent developer equity. EB-5 comes behind senior debt but ahead of equity. When we are talking about the EB-5 loan, that is not the funds that the EB-5 investor is making. That is the loan the NCE makes to the JCE. This loan ranks in between the senior debt and the developer equity. From the EB-5 investor’s standpoint, it is always better to have more equity than less equity contribution by the developer. More equity provides the cushion in a downturn in the markets for the EB-5 investor. For a given amount of EB-5 investment, of course, the less debt there is (that is, the senior loan), the better off you are. However, if the EB-5 is in the first position since there is no senior debt, that could be a red flag for the project. After all, it could indicate that no reputable senior lender wants to take any exposure whatsoever to the project. It does get a little complicated with all the moving parts.
Source of Funds
1) Do gifts qualify as a form of payment for the EB-5 investment?
Yes. Please keep in mind though this method is still subject to the source of funds scrutiny. Also, the donor needs to check with the tax authorities in their legal jurisdiction and consider whether the gift might have tax consequences.
2) What are some of the more common ways to fund an EB-5 investment?
You can get the funds gifted to you. The person making the gift will need to provide information on the source of funds. You can also borrow the funds on a secured basis. In this second alternative, you need to show the source of funds on the original collateral purchase. Recently, in the D.C. Circuit of Appeals, attorneys challenged the position of USCIS that investors had to collateralize the EB-5 capital.
On behalf of H. Zhang and M. Hagiwara, their attorney Ira Kurzban argued that unsecured loans should be permissible to fund the EB-5 capital. Until this ruling, we have always recommended our clients that, while they could borrow money from different sources by pledging their assets such as real estate or marketable securities, unsecured loans were not permissible.
Kurzban successfully argued that USCIS advances several conflicting policy arguments. He said that according to the agency, if the proceeds of unsecured loans qualified as capital, then wealthy third parties could buy visas for foreigners unlikely to create jobs, and foreign investors could qualify to obtain visas by investing domestic funds. The plaintiffs respond that the statute sets forth requirements for the enterprise (not the investor) to create jobs and that it does not prohibit investments (secured or otherwise) involving the U.S. funds of foreign investors. We need not engage these arguments, for we cannot disregard the plain meaning of a regulation based on policy considerations, Mercy Hosp., Inc. v. Azar, 891 F.3d 1062, 1070 (D.C. Cir. 2018). Likewise, given the clarity of the governing regulation, we cannot defer to the agencyís contrary interpretation, Kisor v. Wilkie, 139 S. Ct. 2400, 2415 (2019). Text, structure, and regulatory context show that the term cash as used in 8 C.F.R. ß 204.6(e), unambiguously includes the proceeds of third-party loans. Because USCISís contrary construction is impermissible, we affirm the district courtís decision to set aside the denial of the plaintiffsí petitions.
3) Do the funds for EB-5 have to come from foreign sources?
Funds invested in EB-5 do not necessarily have to come from foreign sources. Many EB-5 investors are already in the United States with visas such as E-2, H-1B, and L-1. They have earned income in the form of profits, salaries, and bonuses. They invest these funds in EB-5 eligible projects. Generally, such investors have an easier time with the source of funds since they have adequate documentation for such earnings.
4) Are funds earned from a lottery eligible for EB-5 as the source of funds?
There is no reason that you should not be able to use funds you have won in a lottery in an EB-5 investment. The only reason that you will not be able to could be if the lottery or the promotion activity in that country was conducted illegally. As long as they were legal activities in the country they took place and you can prove that without reasonable doubt you should be able to use those funds with no problem.
5) What are some of the biggest challenges that investors face when it comes to the source of funds?
Most investors who have not done much research on the requirements of the source of funds assume that commercial bank deposits should not be a problem. This assumption is false. USCIS wants to know how those funds came into their account in the bank. What kind of property was sold, and at what price? When and how did they purchase the sold property? They would need to show the source of funds used when they purchased the sold property. Unfortunately, in many developing countries, transactions are consummated in cash. Even if they pay the taxes due from those commercial transactions, it is difficult for investors to document those. That is why we strongly advise our clients to consult with their immigration attorneys. They should give them the whole picture so that their attorney could advise them on the best path to take in terms of which sums of money to use to fund the EB-5 investment.
6) Does the giver of the gift have to be a parent? Who are eligible parties who can give the gift?
In general, anyone could make a gift. That said, there has to be a justifiable reason for the gift. Parents, other close family members, current or previous employers are natural persons to make a gift. The due diligence of the source of funds of gift shifts to the donor. In other words, while the recipient is not subject to the source of funds scrutiny requirement, the donor is.
7) Does the EB-5 investor need to document the source of funds on inherited funds?
Should the investor plan to use such inherited funds, the investor should consult a competent immigration attorney. If the deceased passed away recently, the scrutiny on the source of funds would be almost identical to that of the usual case where the investor earned the funds in one way or another himself. If the parent passed away a long time ago, it might be sufficient to show adequate evidence that the parent had the means to earn the claimed funds by the investor. Investors can demonstrate this ability by showing the scope of the work the parent did, his bank statements, recommendation letters, etc. Naturally, the investor will need to present proper documentation of the will, bank statements, etc., and prove the lawful transfer of the funds from the deceased account to one of the heirs using the funds for the EB-5 investment.
1) What kind of applicant profile fit the EB-5 visa best?
The applicant has to make up their mind that they would like to move to the United States. Those looking for a plan B should not consider the EB5 visa. If they do not move to the United States within a reasonable time after receiving the green card, the authorities would likely confiscate it.
Of course, they need to have the required investment amount and related fees in liquid funds to proceed. Illiquid funds are ok as long as they are confident that they will liquidate their assets in a reasonable amount of time to make the required investment in one shot.
Typically, unless they deposit the fund with the escrow agent of the regional center, the I-526 application process cannot proceed. Of course, the investor will need to provide the source of funds for the funds he/she intends to use as well.
2) Are there any applications that are not Infrastructure or Real estate related?
Of course. Infrastructure and Real estate-related transactions are the most common ones. They are the easiest route to create the required direct and, if allowed, as it is in the Regional Center model, indirect and induced jobs. But, if you are thinking of a direct investment in a field of your expertise, by all means, you can go into virtually any area as long as you could meet the job creation requirement and make the required capital commitment.
3) My real-estate broker is also promoting EB-5 investments. Is it safe to invest in EB-5 through him even if he does not hold a broker-dealer license?
No. Unlicensed people should not engage in security sale transactions. Unfortunately, they do not realize that selling EB-5 securities without proper licenses is a clear violation of security laws. Being licensed to sell real estate does not grant permission to sell securities. To do that, you need to have proper security licenses such as Series 7 and 63 and be registered and sponsored by a security dealer.
4) Can migration agents in countries such as China, India, Vietnam, and South Korea who do not hold proper security licenses promote EB-5 on United States soil?
It makes no difference that the company is an overseas agent/broker. Once they are on United States soil and are involved in securities transactions, they need to be licensed.
5) Can the principal EB-5 applicant transfer his/her application to a close relative such as his/her spouse?
Unfortunately, he cannot. The new person will have to start the process again, even if he/she is a close family member like a spouse.
6) Dependents of EB-5 applicants of which countries are currently subject to the age-out phenomena?
Once the principal applicant files their I-526 petition, the age of all their dependents is frozen. At the time of their I-526 of approval, we check whether their country of birth is subject to visa retrogression. There is no age-out issue to worry about if it is not subject to visa retrogression, and the applicant can file for the conditional green card within one year. On the other hand, if it is subject to visa retrogression, the applicant cannot apply for the conditional green card until his priority date becomes current. In this case, the age of their dependents is unfrozen. Depending on the time they need to wait, their dependents could age out. For example, assume that the dependent was 20 years old at the I-526 filing, and after I-526 approval, it takes more than one year for the priority date of the principal applicant to become current. Then the dependent will surely, age-out. The applicant can proceed with the conditional green card application as soon as their priority date becomes current. If their dependent was 20 years old at the I-526 filing, and after I-526 approval, it takes less than one year for the priority date to become current, then the dependent will not age out.
7) What are the likely criteria for an EB-5 application to fail?
An EB-5 application could fail because of two reasons:
If the project cannot create or deem to create at least the required number of jobs, USCIS could deny the I-526 petition of the applicant. At the same time, if the proof of the source of funds applicant is not satisfactory to the USCIS authorities, he could get a request for evidence, known as RFE. If he cannot produce the type of documentation USCIS is looking for in the time allotted to him, they could deny his application. Typically, applicants who fund their investments with earned income or sale of inherited property where the official sale price supports the required investment amount do not receive RFEís. Other accepted funding methods of the required investment are collateralized loans or gifted funds. In each of these latter cases, there is still a need for proof of funds. In the loan case, USCIS scrutinizes the source of funds to purchase the collateral used for the loan. In the gifted-funds case, the donor would have to prove how he earned the funds he is donating to the applicant. In summary, as long as the project can create the required number of jobs, the applicant does not have an issue with the source of funds, and the applicant has a clean personal record, his/her EB-5 application would most likely be approved.
8) Some countries like Turkey and Grenada have a treaty with the United States that allows its citizens to get an E-2 visa. This type of visa necessitates a much smaller investment amount and can be processed much more expeditiously when compared to the EB-5. What are some of the pros and cons of getting the E-2 visa versus applying for the EB-5 visa?
That is true. E-2 requires a much smaller investment amount than the EB-5. The source of funds scrutiny they must go through on the E-2 is much less rigorous than that of the EB-5 capital. The E-2 visa is ideal for those who would like to be involved in a business hands-on. They do not have to employ 10+ employees, but 2-3 would do. The downside is that the E-2 does not immediately lead to permanent residency. The EB-5 visa calls for more capital commitment. If the investor is applying, as most EB-5 investors do, through a regional center project, then he/she does not have to be active. The responsibilities to fulfill the job-creation requirement shift to the Regional Center and their partner project developer. Some people view these two visas as mutually exclusive alternatives. That is not correct. Any investor who does not want to wait for two-two and a half years for the conditional green card but is interested in coming to the United States within a few months could apply for the E-2 visa. Once they obtain the E-2 visa, they could then proceed with the EB-5. This way, most likely, before the E-2 visa expires, they would be granted I-526 approval followed by a conditional green card. If later, they would like to convert their E-2 business to an EB-5 eligible one, they can. That said, they cannot count the existing jobs created through E-2. The created jobs need to be ten or more new jobs.
9) Can potential investors whose country of citizenship does not have an E-2 treaty with the United States do anything to avail themselves of the E-2 route?
Yes, there is. Countries such as India, Russia, Brazil, China, Indonesia, Malaysia, Nigeria, Qatar, Saudi Arabia, South Africa, and Vietnam, to name a few, do not have an E-2 treaty visa signed with the United States. Therefore, citizens of such countries cannot apply for the E-2 visa directly. They can nevertheless apply for an E-2 visa by becoming a citizen of another country with an E-2 treaty with the United States, such as Grenada, Turkey, or Montenegro. To the best of our knowledge, none of these countries have an issue with dual citizenship. Therefore, later on, if the investor wishes to proceed with an EB-5 application, there should not be a problem.
10) For adjustment of status filing purposes, when can EB-5 applicants who have approved I-526 petitions use Final Action Dates? When can they use Dates for Filing?
USCIS will state on their web page that the applicant may use the Dates for Filing chart provided that they determine that there are more immigrant visas available for a fiscal year than known applicants for them. Otherwise, they will indicate on the same page that they must use the Final Action Dates chart to determine when they may file their adjustment of status application. However, applicants in that immigrant visa category may file using the Final Action Dates chart during that month if:
- A particular immigrant visa category is current on the Final Action Dates chart or,
- The cutoff date on the Final Action Dates chart is later than the cutoff date on the Dates for Filing chart.
For Employment-Based Preference Filings such as EB-5, applicants must use the Final Action Dates chart in the Department of State Visa Bulletin for that month.
11) The United States tax responsibility is based on global income as opposed to strictly US-related income. Does this create problems such as double taxation?
No, it does not. Firstly, the United States tax liability occurs after they receive the conditional green card. In most cases, the investors can deduct the taxes they paid on their foreign income. They are only liable to pay the tax due on the difference. This treatment is because the United States has a tax treaty with most countries in the world. Should the investor continue to earn income in their home country, this income is added to their global income, inclusive of their United States earnings, if any. Their tax liability is a function of these consolidated earnings. However, instead of paying the Internal Revenue Service this sum, in most typical cases, they can deduct the taxes paid to other jurisdictions and owe the Internal Revenue Service only the balance.
12) Could the borrower or third party guarantee the EB-5 investment?
USCIS will deny the I-526 petition if the investment carries a guaranteed repayment. That is why investments in the form of fixed income debt are not eligible. That said, a third party could provide a guaranty for the loan made by the NCE to the JCE. This guaranty is acceptable because even after the JCE pays back the loan to the NCE, the NCE has no obligation to return the funds to the investor. The expectation is that if the investor is ready to receive the funds, they will. However, this is not a certainty.
13) Can international students with F-1 visas apply for the EB-5? What are the potential problems?
While F-1 is not an immigrant intent visa, EB-5 is. On a practical matter, there is no problem in applying for it. However, one needs to be careful and proceed with caution under the guidance of an experienced immigration attorney. If the EB-5 applicant is a parent and the F-1 visa holder is a dependent applicant, technically speaking, there is no conflict. If the student needs to extend his F-1 visa or reenter the United States, they need to disclose their pending I-526 petition. The safest path for the F-1 visa-holding student in the United States to take would be to wait until I-526 approval. Once they have an appointment at the consulate for the green card, they could leave the country and return with the permanent residency stamp on their passport.
14) Can a fiancÈ be added to the EB-5 petition?
At the time of I-526 applications, you do not need to be married. You can always add your wife before you apply for conditional permanent residency. If you do not add her to your application at that time, you can always sponsor your wife once you obtain your green card. USCIS on their website clearly states: To bring your spouse (husband or wife) to live in the United States as a green card holder (permanent resident), you must be either a United States citizen or green cardholder.
15) Could you elaborate on the at-risk requirement?
The capital investment of the EB-5 investor must be at risk. Unlike some might claim, fixed income investments, for example, do not qualify as EB-5 eligible investments. The investment needs to have equity-like features. That is why, in the Regional Center model, we have the NCE most often making a loan to the JCE. The EB-5 investors are typically preferred stockholders of the NCE because they cannot lend the EB-5 funds directly to the NCE. Technically speaking, the NCE has no explicit obligation to return the funds to the EB-5 investor either. The EB-5 investors, through their collective investment in the preferred stock of the NCE, receive a preferred rate, but if the NCE fails to pay them, they would not be under default. That said, most reputable regional centers do their best to redeem the capital contribution of the EB-5 investors upon I-829 filing.
16) Does the denial of the adjustment of status application of a dependent applicant negatively affect the I-829 removal of conditions petition of the principal applicant?
No. The rejection of the I-485 petition of the dependent should not negatively affect the I-829 removal of conditions petition of the EB-5 investor.
17) Can investors apply for the EB-5 after filing a nonimmigrant visa and vice versa? Sometimes they would like to switch from one type of immigrant visa petition to another.†Is that allowed?
Yes. There is a lot of misunderstanding about this topic. One could have a short-term nonimmigrant intent while having a long-term immigrant one. For example, international students obtain an F-1 visa to study in the United States, and then immediately after entry to the United States, they can apply for the EB-5. Sometimes, students apply for the EB-5 visa, either directly or indirectly, as a dependent before getting an F-1. If the applicant is a derivative applicant, since they are not the actual EB-5 investor, they will most likely not have an issue with obtaining the F-1 visa. On the other hand, if the applicant is already an adult and directly applied for the EB-5, clearly showing immigrant intent, he or she would have to provide enough information to convince USCIS.
18) Is it possible to transfer the EB-2 priority date to a new EB-5 application?
The short answer is no. You cannot transfer the EB-2 priority date to EB-5. However, if you decide to apply for the EB-5, you do not need to cancel your EB-2 application. If the EB-2 is approved before you can apply for adjustment of status on your EB-5, you can proceed with the EB-2.
19) Can clients who currently hold E-2 visas upgrade to EB-5 and obtain a green card that way?
Many investors from countries that have signed the E-2 treaty with the United States have this question in their minds. E-2 processing is fast and considerably cheaper than EB-5. The required investment amount is less, and the processing time is shorter. Unlike EB-5, E-2 does not have a set investment amount requirement. Therefore, E-2 is an attractive alternative route for many eligible investors. If there were a possibility that the investors might want to use the funds initially used for the E-2 to form the base of their future required EB-5 investment, then those initial funds would have to be able to survive the rigorous source of funds scrutiny of the EB-5. In addition, they will need to create ten new full-time positions. Many applicants are also under the impression that their business, when expanded, would qualify for the $ 900,000 reduced required amount that might not necessarily be the case. They might find themselves having to up their investment to $ 1.8 million when the time comes for them to upgrade to EB-5. They might be discouraged due to the economics of the upgrade.
20) What would be the three top pieces of advice we can give to a prospective EB-5 investor?
- Think hard whether you are ready and prepared to move to the United States and live here permanently. EB-5 is an immigrant intent visa. Those unsure whether they want to make the United States their new homeland should inquire about alternative methods to come to the United States.
- Pick a financial advisor or licensed broker-dealer to work with to identify an eligible project for investment. The minimum required investment amount for EB-5 is $900,000. The total expenses considering the legal and government filing fees and regional center administrative fees could easily total $ 100,000 or more. You need a professional to aid you in the project selection, due diligence, and follow-up.
- Work with an experienced immigration attorney specialized in EB-5 who will work with you and guide you through every step of the way.
21) What is an Opportunity Zone? How can I take advantage of it?
According to Internal Revenue Service published definition, an Opportunity Zone is an economically-distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment. Localities qualify as Opportunity Zones if the state has nominated them for that designation. The Secretary of the United States Treasury, via his delegation of authority to the Internal Revenue Service, needs to certify that nomination. Added to the tax code by the Tax Cuts and Jobs Act on December 22, 2017, they now cover parts of all 50 states, the District of Columbia, and five United States territories. Designed to spur economic development by providing tax benefits to investors, they are an excellent tool for investors seeking tax benefits. The law allows investors to defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of:
- The date the investment in a QOF is sold or exchanged, or
- December 31, 2026, because it expects QOF to spur economic development.†
If they hold the QOF investment for longer than five years, there is a 10% exclusion of the deferred gain. If held for more than seven years, the 10% becomes 15%. If held for at least ten years, the investor is eligible for an increase in the basis of the QOF investment, equal to its fair market value on the date that the QOF investment is sold or exchanged. For additional information, QOF investors should visit Treasury.gov and IRS.gov.
22) What is an RFE?
RFE means Request For Further Evidence. If USCIS has questions about certain aspects of the I-526 petition, they send in an RFE. Typically, but not necessarily, this occurs within the context of the source of funds. If the investor has not provided sufficient documentation on how he had obtained the funds to fund the investment, this might occur. Recently, the courts ruled that borrowed funds do not need to be collateralized. As of this writing, we are unclear how USCIS plans to change its policy because of this ruling. Up until now, the policy of USCIS has been as follows
- If the investor uses borrowed funds, then they need to collateralize the loan. Furthermore, they must show the source of the funds used to purchase the collateral used to borrow the funds from the lender.
- If the investor obtains the funds through a gift, the gifter has to show the source of the funds.
23) Even if the project created the required number of jobs, what would happen to the I-829 petition should the project go bankrupt before the filing of I-829?
As long as the project created the required number of jobs, there should be no problem with:
- The removal of conditions and,
- The conversion of the conditional green card to a permanent green card
24) When does a prospective EB-5 investor earn the right to United States citizenship?
After one receives the conditional green card, we start counting the years. As long as they spend more than half of that period in the United States, the prospective candidate becomes eligible for citizenship five years following the date he obtains the conditional green card.
EB-5 Processing: Fees, Timeline, duration, processing times, etc.
1) What are the principal processing fees in EB-5?
2) Can the dependent child of the principal applicant file the I-526 petition and then apply for the F-1 visa?
Great question. We are getting this question a lot, especially from investors who have kids born in visa retrogression countries. Their kids are not ready to apply for the F-1 visa yet because they are still in high school in their home country. Therefore, they ask us whether, to gain time, they should go ahead and file for the EB-5 anyway and apply for the F-1 when their kids are ready to go to college. The short answer is that on a practical level, this is fine, although F-1 is not an immigrant intent visa while EB-5 is an immigrant intent petition. One could have a long-term goal of immigrant intent with a short-term goal of not an immigrant one. There is a small risk of denial, of the F-1 visa, due to the conflict between these two intents. The parent filing with the kid, as the dependent, is a much better case pattern. The one who has declared their immigrant intent becomes the parent rather than the derivative applicant, the child. In this latter case, this becomes a disclosure item when filing for the F-1 visa.
3) Can you comment on the best strategy for applicants in the United States who would like to travel abroad and work following I-526 approval if they think it might take a long time before the conditional green card is approved? What are their options?
Following the approval of the I-526 application, an investor in the United States could file simultaneously I-485 to receive the conditional green card. Once they file I-485, they can also file I-131 to travel abroad and I-765 to obtain work authorization. Because I-485, Application to Register Permanent Residence or Adjust Status, can take several months, following I-526 approval, filing I-131 and I-765 to travel abroad and to be able to work is an excellent idea.
4) When can investors expect to be paid their capital back?
At the end of their 2-year mandatory sustainment period, they can ask the Regional Center to return their capital once they have filed their I-829 petition to remove the conditions from their green card.
You might want to review this link published by the USCIS:
Scroll down and read Footnote 4 that says,(see 8 CFR 216.6(c)(1)(iii)) the sustainment period is the investorís two years of conditional permanent resident status. USCIS reviews the investorís evidence to ensure sustainment of the investment for two years from the date the investor obtained conditional permanent residence. An investor does not need to maintain his or her investment beyond the sustainment period.
5) Does the EB-5 investment have to be made before I-526 filing?
As a practical matter, that is true. Regional Centers do not generally accept you to file an I-526 petition before wiring the funds to the escrow. USCIS, in their website, cite as follows:
The petitioner must establish he or she meets the following eligibility requirements when filing the Immigrant Petition by Alien Investor (Form I-526): The required amount of capital has been invested or is actively in the process of being invested in the new commercial enterprise.
6) Could the I-526 processing time be expedited?
In rare instances, it can be, but once approved, the green card process will take just as long. For example, even if candidates from countries currently experiencing visa retrogressions such as China or Vietnam can successfully expedite their I-526, short I-526 processing time might have little to no consequence for them. The conditional green card application in these countries is not current. That said, they might benefit from expedited decisions on their I-526 if they are from a country that is not experiencing visa retrogression at the moment. Although hard to achieve, USCIS will approve an EB-5 request. The petitioner can attempt to show one or more criteria exist, making the approval of their expedite request help the situation or avoid a negative outcome. These criteria in no particular order are:†
a. severe financial loss to an individual or the company,†
b. an extreme emergent situation such as the danger of human rights violations or persecution,†
c. a humanitarian situation as pressing medical or health-related need,†
d. nonprofit status of an organization that furthers the cultural and social interests of the United States,†
e. a Department of Defense or national interest situation,†
f. USCIS error, or
g. Other compelling USCIS interests.
7) How long does it take to process each step of the EB-5 application?
The processing times across the board have increased indeed. USCIS has a website where they publish their experience. The link is:
If the country of birth of the investor is not marked as retrogressed, they would be able to apply for the conditional green card through:
a) Adjustment of status if they are in the United States or†
b) Consular processing if they are overseas.†
Adjustment of status depends on which service center they choose. The same website contains a complete list of them. If they are overseas and apply for the conditional green card through consular processing, this process should take less time under normal conditions. Finally, once they get their conditional green card and fulfill the mandatory 2-year sustainment period, they would be eligible to apply for removing them from their green card. This step is called I-829 filing. We expect that the actual processing times are generally better than the posted official times, but there no guarantees.
At this point, clients should realistically expect 36 months for the I-526 stage. Whether they are applying in the United States or overseas, they should budget another nine months for the green card process. So, within approximately four years, assuming no visa retrogression issues to deal with, they could get their green card. To apply for the removal of conditions, they need to wait for another two years, commonly known as the sustainment period. Ninety days before the end of the sustainment period, the investor could file for the I-829. They could receive their capital back soon after provided that either the terms on the private placement memorandum allow, or the regional center is willing to pay back. So, the total time for them to get their EB-5 funds back would then be three years for the I-526, another one year for the conditional green card, and another two years for the sustainment period making the total six years. Assuming all the assumptions above work out at the end of these six years, they could get their capital back.
As for I-829 approval, for the removal of conditions from the green card, USCIS is showing 35 to 60 months. So, the best-case scenario for this phase would be another three years, making the total number of years to receive a permanent green card nine years.
Hopefully, in the coming months, we will see these processing times coming in.
8) How much flexibility is there regarding the obligation to reside in the United States during the conditional green card phase?
We get this question a lot. We have clients who want to be in the United States already yesterday as one end of the spectrum. On the other end of the spectrum, we have clients who do not want to move to the United States at all but would like to get the green card and store it in their safe for a rainy day. USCIS views the EB-5 application as an indication of the intent of permanent residency. Unlike the other temporary visas like a tourist or student visas, they give this visa to people who want to move to the United States to live and work in the United States. Therefore, USCIS expects the applicant to move to the United States when the conditional green card is issued. That said, the government realizes that moving personal assets, family, business, etc., could take a while. Therefore, as long as the moving process has started, there is significant flexibility. We recommend that applicants make an entry to the United States once they obtain their conditional green card. Furthermore, they do not remain outside the United States for more than six months. Eventually, they make the necessary arrangements to move to the United States permanently.
9) Investors born primarily in retrogressed countries would like to know whether they should consider expedited projects. Should these investors opt for such projects or not?
There is no denying that we are experiencing unprecedentedly long processing times with I-526 petitions lately. Clients should always opt for projects that are strong on their own merits. They should consider many other more essential criteria before. Investors should make sure that the projects they invest in:
- Are viable
- Can create the requisite number of jobs and
- Have enough value at completion such that after payment of senior obligations, they can receive their capital investment back.
Once these and potentially other significant points are taken care of, they could consider expedited processing projects. However, it will do very little good for investors who are right now from countries experiencing visa retrogression. For example, for mainland China-born applicants, expedited processing will have no impact at all today. On the other hand, applicants from any other not retrogressed country should seriously consider them if the expedited project checks the due diligence criteria above. These projects could reduce the time to obtain the conditional permanent residency status.
10) What can EB-5 investors who have approved I-526 petitions and are waiting to receive communication from the National Visa Center (NVC) for months do?
The attorney who filed their case should get in touch with USCIS. They should confirm the transfer of their file to NVC. In case it was not, this communication from their attorney should speed up things. In the unlikely chance that USCIS does not respond, they could ask their attorney to start a Mandamus case. We have seen the negative effect of this kind of situation with children in danger of aging out. According to Child Status Protection Act, once the I-526 petition is approved, the green card application needs to start within one year. If the investor is not from a country experiencing a backlog, such as China or Vietnam, this is usually not an issue. That said, potentially due to the pandemic and more general slowdown of all the processing times in immigration methods, this has also become a potential problem for applicants born in countries other than China and Vietnam currently not experiencing any backlogs. The simple advice we can provide our clients is to be vigilant in this matter and contact their immigration attorney without further delay.
1) What are the significant changes the new rules brought about when they became effective on November 21, 2019?
As of the effective date of the final rule, the standard minimum investment level increased from $1 million to $1.8 million, the first increase since 1990 to account for inflation. It also keeps the 50% minimum investment differential between a TEA and a non-TEA, increasing the minimum investment amount from $500,000 to $900,000. The final rule also provides that the minimum investment amounts will automatically adjust for inflation every five years. It outlines changes to the EB-5 program to address gerrymandering of high-unemployment areas. The new rules outlaw deliberately manipulating the boundaries of an electoral constituency. Urban areas such as New York, Los Angeles, and Miami will not be a TEA. The rule revises regulations so that certain derivative family members who are lawful permanent residents must independently file to remove conditions on their permanent residence. The requirement would not apply to those family members included in a petition of the principal investor. The rule improves the adjudication process for removing conditions by providing flexibility in interview locations and adopting the current USCIS process for issuing Green Cards. Finally, it also offers greater flexibility to immigrant investors who have a previously approved EB-5 immigrant petition.
2) We are receiving multiple requests from our clients asking for clarity on the pending Behring Regional Center vs. Chad Wolf lawsuit. Could you please tell us what Plaintiff is arguing about and what is the response of the government? Finally, please tell us how that would affect the EB-5 business in the future.
This lawsuit is the second one brought against the government. Plaintiff is questioning the validity of the changes adopted and implemented. The first lawsuit claimed that the new regulations would cause economic harm. In this second lawsuit, Plaintiff is arguing that neither the then-acting DHS Secretary Kevin McAleenan nor the then-Acting DHS Secretary Chad Wolf had the proper authority to propose and then issue the regulations. Greenburg Traurig is representing Plaintiff.
This case is of utmost importance for potential investors who have been on the sidelines waiting for the possibility of the required minimum investment amounts to be adjusted down. They are all asking what the chances of success of this lawsuit are in favor of the Plaintiff.
According to IIUSA, the court also asked the government to provide a brief on remedies should the motion for summary judgment be granted. This decision may include sending the decision on whether to abandon or reissue the regulations back to the current Secretary of Homeland Security, Alejandro Mayorkas. The court stated, if she were to vacate [the regulation] because she found it was invalid, it would go back to the secretary, who could re-impose it if he agrees with it.
We believe that, most likely, this lawsuit will be inconsequential. Either the court will dismiss it, or they will not issue an injunction, or will ask the current Secretary of Homeland Security, Alejandro Mayorkas, whether he would reissue the regulations as is. Besides, we have a proposed reauthorization bill by Senators Chuck Grassley and Patrick Leahy. If enacted, the bill would reauthorize the EB-5 regional center program, through September 30, 2026, with the current investment levels. There is widespread industry support for this bill. IIUSA is also championing it to become the law before June 30, 2021, the scheduled expiration of the program.
Mayorkas stated that if they were to seek his opinion, he would ratify the reform as is. Based on this development, we conclude that even if the court were to rule in favor of Behring Regional Center, the decision would be inconsequential.
3) Can we get some clarity on the newly expanded definition of Accredited Investor?
According to a statement released on August 26, 2020, by the Chairman of the United States Securities and Exchange Commission, Jay Clayton, for the first time, individuals would be allowed to participate in private capital markets not only based on their income or net worth but also based on established, and transparent measures of financial sophistication. He added that they have expanded and updated the list of entities, including tribal governments and other organizations that may qualify to participate in selected private offerings.
The amendments revise Rule 501(a), Rule 215, and Rule 144A of the Securities Act.
The amendments to the accredited investor definition in Rule 501(a):
a) Add a new category that permits natural persons to qualify as accredited investors based on selected professional certifications, designations or credentials, or others issued by an accredited educational institution the Commission may designate from time to time by order. The Commission defined holders in good standing of the Series 7, Series 65, and Series 82 licenses as qualifying natural persons, by order, in conjunction with the adoption of these amendments.
b) This approach provides the Commission with the flexibility to reevaluate or add certifications, designations, or credentials in the future.
c) Include as accredited investors, concerning investments in a private fund, natural persons who are knowledgeable employees of the fund.
d) Clarify that limited liability companies with $5 million in assets may be accredited, investors.†
e) Add SEC- and state-registered investment advisers, exempt reporting advisers, and rural business investment companies (RBICs) to the list of entities that may qualify.
f) Add a new category for any entity, including Indian tribes, governmental bodies, funds, and entities organized under the laws of foreign countries, that own investments, as defined in Rule 2a51-1(b) under the Investment Company Act, over $5 million and not formed for the specific purpose of investing in the securities offered.
g) Add family offices with at least $5 million in assets under management and their family clients, as each term defined under the Investment Advisers Act.
h) Add the term spousal equivalent to the definition of the accredited investor so that spousal equivalents may pool their finances to qualify as accredited investors.
The amendment to Rule 215 replaces the existing definition with a cross-reference to Rule 501(a) definition. The amendments expand the qualified institutional buyer definition in Rule 144A to include limited liability companies and RBICs if they meet the $100 million in securities owned and invested threshold definition. The amendments also add to the list any institutional investors included in the accredited investor definition not otherwise enumerated in qualified institutional buyer definition provided they satisfy the $100 million thresholds. The Commission also adopted conforming amendments to Rule 163B under the Securities Act and Rule 15g-1 under the Exchange Act.
4)Politico Magazine published an article on March 20, 2020, entitled, Trump considers increasing visas for foreign investors, claiming that Trump Administration is considering increasing visas for foreign investors and reducing the minimum required investment amount, from $900,000 to $450,000. Could you please clarify whether there will be such a change?
The Politico article claimed that The Trump administration is considering boosting the number of EB-5 visas offered to wealthy immigrants. It continued to claim that the proposal that could be included in one of the Senateís coronavirus rescue bills would significantly boost the number of visas offered annually from 10,000 to 75,000 while reducing the investment required to earn legal residence from $900,000 to $450,000. Finally, it argued that Sen. Lindsey Graham (R-S.C.), Chairman of the Senate Judiciary Committee and a Trump ally, is pushing the expansion.
In an interview on Fox News with Sean Hannity, Senator Graham denied the validity of the Politico article claims. He said that the claims are false and added that he did not talk to anybody about putting EB-5 on the COVID-19 bill. He also said that he would object to anything in the COVID-19 bill unrelated to solving the problem.
Finally, IIUSA, the EB-5 industry trade organization, in an article they published to their members, put the matter to rest. They said that such rumored proposals are non-starters from many quarters of Capitol Hill. Poison pills would kill efforts to earnestly and pragmatically reform and extend the EB-5 Regional Center program. Period. Investment amounts are not moving to $450,000, and to date, there are no new visas for the EB-5 program.
5) USCIS clarified guidance on the initial and further deployment of EB-5 investment capital on July 24, 2020. Can you provide a summary?
Although the announced policy of USCIS clarifies many of the open issues, it still leaves quite a few items open to discussion. In no order of importance, the newly announced policy states that further redeployment:
- must be through the same NCE and be consistent with the original purpose of the NCE
- must be within the geographic area of the same regional center, including any amendments to the regional centerís geographic area approved before the further deployment
- must be made within a commercially reasonable period whereby USCIS generally considers 12 months
- cannot be made into financial instruments, including municipal bonds or securities
6) Can EB-5 investors use unsecured loans as funding for their EB-5 capital?
The ruling of the U.S. Court of Appeals for the D.C. Circuit on October 27, 2020, is probably the most interesting one that has happened since the inception of the EB-5 program. On behalf of H. Zhang and M. Hagiwara, their attorney Ira Kurzban argued that USCIS should admit unsecured loans as permissible to fund the EB-5 capital. Until this ruling, we have always recommended our clients that, while they could borrow money from different sources by pledging their assets such as real estate or marketable securities, unsecured loans were not permissible.
Kurzban successfully argued that USCIS advances several conflicting policy arguments. He said, ìAccording to the agency, if the proceeds of unsecured loans qualified as capital, then wealthy third parties could buy visas for foreigners unlikely to create jobs, and foreign investors could qualify for visas by investing domestic funds. The plaintiffs respond that the statute sets forth requirements for the enterprise (not the investor) to create jobs and does not prohibit investments (secured or otherwise) involving the U.S. funds of foreign investors. We need not engage these arguments, for we cannot disregard the plain meaning of a regulation based on policy considerations, Mercy Hosp., Inc. v. Azar, 891 F.3d 1062, 1070 (D.C. Cir. 2018). Likewise, given the clarity of the governing regulation, we cannot defer to the agencyís contrary interpretation, Kisor v. Wilkie, 139 S. Ct. 2400, 2415 (2019). Text, structure, and regulatory context show that the term cash, as used in 8 C.F.R. ß 204.6(e), unambiguously includes the proceeds of third-party loans. Because USCISís contrary construction is impermissible, we affirm the district courtís decision to set aside the denial of the plaintiffsí petitions.” As a result, on April 14, 2021, USCIS approved Mr. Zhangís I-526 petition.
7) The big news in immigration on January 22, 2020, was that Iranian nationals are no longer eligible to apply or extend their existing E-2 visas. What alternatives could Iranians consider?
USCIS revealed the new development in a press release, asserting that this change came as a result of the October 3, 2018, termination of the 1955 Treaty of Amity, Economic Relations, and Consular Rights with Iran. Given that E-1 and E-2 nonimmigrant visas are based on trade and investment treaties, or specific legislation providing for reciprocal treatment of the respective country nationals, USCIS said that the existence of a qualifying treaty or authorizing legislation is, therefore, a threshold requirement for issuing an E visa. One option existing E-2 visa holders currently in the United States can consider is to apply for the EB-5. If their I-526 approval and subsequent adjustment of status can be completed before the expiration of their E-2 visa, then they would not have to leave the United States. On the other hand, if the EB-5 process takes longer, their E-2 visa could expire. They might then have to wait overseas. For Iranian citizens who are currently overseas, second-country citizenship could be an option. Today, obtaining Turkish citizenship is inexpensive and efficient. With professional advice, the whole process could take less than six months. Of course, there are other options like Grenada, Cyprus, Malta, etc., but these are more costly than Turkish alternatives.
8) What are some of the most significant immediate immigration and international travel-related actions the Biden Administration took upon coming to the office on January 20, 2021?
Holland & Knight in a web publication dated January 26, 2021, summarized them as stated below:
- Required to produce proof of a recent negative COVID-19 test before entry; and
- Required to comply with other applicable CDC guidelines concerning international travel, including recommended periods of self-quarantine or self-isolation after entry into the United States.
- Revoked the Muslim and African travel bans 4.0 and 3.0 affecting citizens of Iran, Libya, Somalia, Syria, Yemen, Venezuela, North Korea, Belarus, Burma, Eritrea, Kyrgyzstan, Nigeria, Sudan, and Tanzania. The Department of State through its authorized local U.S. embassy or consulates can immediately process visa applications for individuals from the affected countries on a post-by-post basis, consistent with the Departmentís ongoing COVID-19 pandemic-related guidance for safely returning our workforce to Department facilities.
- 100-day pause on deportations and rescission of the February 2017 Trump order announcing all-out enforcement without any prioritization.
- Declaration of the end of the ìnational emergencyî at the southern border
- Preservation of and Plans to Strengthen the DACA Initiative
- Suspensions of New Enrollments in Migrant Protection Protocols Program
- Extension of Deferred Enforcement Departure for Liberians for 18 Months
- Halt of President Trumpís plan to exclude non-citizens from the census and apportionment of congressional representatives.
- Review of any pending regulatory actions for possible withdrawal and delay of effective dates of regulations that were published but have not yet taken effect.
As reported by AILAís Jan 22, 2021 post, President Biden has also sent an immigration bill to Congress for Senator Robert Menendez (D-NJ) and Congresswoman Linda S·nchez (D-CA) to sponsor. Here are the key provisions of the proposed bill:
- Legalization and path to citizenship for unauthorized immigrants
- Reforms to the family-based immigration system, including:
- Reforms to the employment-based immigration system, including:
- Diversity Visa Program will be increased to 80,000 visas per year (from 55,000)
- Reforms to the immigration courts, including steps to reduce backlogs and restoration of judicial discretion to grant relief
- Expansion of legal representation and legal orientation programs
- Improvements to asylum, U visa, T visa, and VAWA humanitarian programs, including the elimination of the 1-year asylum filing deadline and increase of the U visa cap to 30,000 visas
- Prohibition against future discriminatory bans such as the Muslim and African travel bans
- Reforms to manage the border and ports of entry, including increased accountability measures and increased resources, technology, and infrastructure
- Programs and funding to address the root causes of migration from Central America
- Protection for workers from exploitation
9) On January 29, 2020, USCIS announced that they would no longer approve I-526 petitions on a first-in-first-out basis but rather according to the visa availability approach. Could you please elaborate on this significant change?
According to USCIS, this new operational approach aligns with other visa-availability agency adjudication processes. It is more consistent with congressional intent for the EB-5 Immigrant Investor Program. It also increases fairness in the administration of the program.
USCIS Deputy Director, Mark Koumans, said that changing their approach from a first-in, first-out adjudication process to prioritize petitions connected to individuals from countries where visas are currently available better aligns with the congressional intent for the EB-5 program. Furthermore, it makes it more consistent with other USCIS operations. He also added that this new approach increases fairness, allowing qualified EB-5 petitioners from traditionally underrepresented countries to have their petitions approved more timely to receive consideration for a visa.
This operational change is consistent with the agencyís processing of Form I-130, Petition for Alien Relative, in cap-subject categories. The new visa availability approach gives priority to petitions where visas are immediately available, or soon available, and will not create legally binding rights or change substantive requirements. Applicants from countries where visas are immediately available will now be better able to use their annual per-country allocation of EB-5 visas. The new visa availability approach will apply to petitions pending as of the effective date of the change. USCIS will implement the visa availability approach on March 31, 2020.
Countries, such as mainland China, might be negatively impacted by this change. Previously, applicants, with no chance for adjustment of status or scheduling a consular interview, had their I-526 petitions approved simply due to the relatively early date of their I-526 filing. As a result, applicants from countries where there is visa availability had to wait unnecessarily long periods. For example, as of today, USCIS is posting 32.5 to 49.5 months for current I-526 processing times. A couple of years ago, this number was significantly lower. We expect this change, when implemented, to bring in processing times for applicants with no backlog.
1) What is visa retrogression?
In the EB-5 category, USCIS allocates 10,000 visas each year. As long as visas sought from the entire world do not exceed this number, there is no reason to classify countries as retrogressed. However, when the number of them sought in any given year exceeds this total allocation, applicants from over-subscribing countries are subject to it. To make room for applicants from other countries, USCIS makes these applicants wait.
2) Many of our Chinese clients are no longer wish to apply for the EB-5 visa. They do not want to wait for 17-20 years to get a green card. Given this reality, what advice can we give them as alternate methods to come to the United States?
Many attorneys nowadays are proposing to Chinese investors who were born in Mainland China and others from countries with no E-2 treaty but are facing potentially severe EB-5 visa retrogression issues to apply for the citizenship of another second country. Turkey and Grenada citizenships seem to be the preferred routes. Once applicants obtain Turkey or Grenada citizenship, they can apply for the E-2 visa to come to the United States. The source of funds requirement of E-2 is much less rigorous than that of EB-5 as well. Applicants can obtain Turkey or Grenada citizenship within six months. E-2 processing times are a couple of months as well. Therefore, the combined process takes less than a year. The spouse of the E-2 visa applicant can work at any job of their choosing with no restrictions. Typically, the duration of this visa is five years for citizens of Grenada. If they have the means, there is no reason for the E-2 visa holder not to apply for the EB-5 once they are in the United States with the E-2 visa.
3) How does USCIS determine if a candidate is subject to visa retrogression or not? Do they look at citizenship or country of birth?
Most people have the citizenship of their country of birth. Nevertheless, with worldwide mobility increasing, this is no longer necessarily the case. A British citizen could be born in India, while an Indian citizen in Britain. Currently, mainland China and Vietnam-born applicants are subject to visa retrogression. Therefore, a British citizen born in China would be subject to visa retrogression despite his/her British citizenship status. However, a Chinese citizen born in one of the Gulf countries such as the United Arab Emirates, Qatar, Bahrain, Kuwait, Oman, etc., would not be subject to it. That said, citizenship could affect whether the applicant could get a counselor interview after obtaining I-526 approval. For example, until recently, citizens of travel-ban countries such as North Korea, Venezuela, Syria, Somalia, Yemen, Iran, and Libya were barred from entering the United States.
4) If a potential applicant already has a pending EB-2 application, can they also file for EB-5 and vice versa?
They can because two immigrant petitions could be pending at the same time. Whichever one is approved first, as long as there is no visa retrogression, they can go ahead and adjust status with that one.
5) How can cross-chargeability be useful?
Cross-chargeability can be useful when:
- The principal investor is born in a country with visa retrogression, and
- Their spouse is born in a country that does not have visa retrogression.
They could then apply through the country of birth of the spouse, thereby avoiding visa retrogression. This accommodation does not apply, however, to their children. In other words, they cannot use cross-chargeability against the country of birth of their children.
6) What is the difference between Chart A and Chart B?
There is some confusion between Chart A (Final Action Dates) and Chart B (Dates of Filing). To determine when an applicant can get a green card, we use Chart A. Applicants need to use Chart B to apply for a green card. If the applicant has filed from overseas, they can use Chart B to file for the green card through consular processing. That said, the consular will not process their application until they are current under Chart A. To file for a green card if the applicant is in the United States, instead of consular processing, they go through the adjustment of status process. Each month, USCIS announces whether they will permit the applicants to use Chart B for that month. Occasionally, USCIS allows this for applicants currently residing in the United States. This information is significant for these clients. Once they apply for the green card through the adjustment of status process, they can also file work authorization and travel permits. Because the applicants who reside overseas are not adjusting status, they do not have this benefit. They have to wait until they are current under Chart A to schedule an interview.
7) What is the minimum age requirement for filing the I-526 petition to avoid the risk of aging out?
Although there is no minimum age requirement for filing an I-526 petition, each regional center has its guidelines. Most regional centers require the child to be at least 18 years old so that the child is compliant with contract law considerations that differ from a state-by-state basis. When the applicants file the I-526 petition, the age of their child is frozen. Once their I-526 petition is approved, the age of their child is no longer frozen. If the principal applicant can file for the conditional green card within one year of approval of the I-526 petition, there would be no danger of aging out. For further more detailed information on this topic, please visit: https://www.eb5investors.com/magazine/article/eb-5-investors-child-status-protection-act
8) What should investors from retrogressed countries be thinking as an alternative to EB-5?
If their country of citizenship does not have the E-2 treaty with the United States, they should consider second country citizenship. They could obtain it at a very reasonable cost. For example, to get Turkish citizenship, the required investment amount in real estate is only $250,000. The whole process could take less than six months. Turkey has an E-2 treaty with the United States. These clients could come to the United States through the E-2 visa once they secure second country citizenship like Turkey. Other treaty countries offer E-2 opportunities as well at a very reasonable cost. For example, Grenada is an alternative.
9) Could you please elaborate on the visa retrogression risk and the related reinvestment risk?
The new commercial enterprise (NCE) can return the investment funds to the EB-5 investors after the loan from it to the job-creating enterprise (JCE) matures. However, if the EB-5 investors have not filed their I-829 petition yet, this payment could put their EB-5 petition in jeopardy. Until recently, most regional centers would place those funds back in escrow and wait for the investors to receive the funds. However, USCIS has become very vocal recently that this practice does not comply with the letter of the law for EB-5. In their view, until the investors file their I-829 petition, their funds must be at risk. They believe that as long as the funds are in escrow, they are not at risk. Therefore, the NCEís have to redeploy the funds to other projects creating reinvestment risk. When the investors eventually file I-829, the funds could still be locked up in the new project. Therefore, the investors could end up having to wait longer than they originally anticipated.
10) Does the reinvestment risk happen only because of visa retrogression, or are there other reasons?
If the project is in its final stages of completion, on the one hand, the project is very safe from a job-creation standpoint. Most, if not all of the direct construction jobs, the indirect jobs, and even the induced jobs may be in place, making the EB-5 investment very safe from an immigration standpoint. On the other hand, since the investor, in this case, would most likely have a few more years for his whole process to finish, he would most likely be facing reinvestment risk. Therefore, even though the investor is not a citizen of a country subject to visa retrogression, he could still be subject to reinvestment risk by simply choosing a project he considers safe. Unfortunately, a project that needs to return capital before the investor is ready will create reinvestment risk for him.