IIUSA v. USCIS: The Fight Over EB-5’s Sustainment Period

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IIUSA v. USCIS: The Fight Over EB-5’s Sustainment Period 

A Clash That Could Reshape EB-5

How long should EB-5 investors be required to keep their capital “at risk” in a project?
That question, central to the economics of the $8 billion EB-5 market, has sparked a high-stakes legal battle between Invest in the USA (IIUSA), the industry’s largest trade group for regional centers, and U.S. Citizenship and Immigration Services (USCIS).

At stake: whether the minimum “sustainment period” is two years, as USCIS currently interprets, or closer to five years, as IIUSA argues is necessary for investor protection and project stability.

Background: The RIA Shift

The Reform and Integrity Act of 2022 (RIA) changed the EB-5 sustainment period.

Before the RIA, the rule linked the return of investor capital to the completion of the investor’s conditional permanent residency for many years, especially for applicants from oversubscribed countries, such as China.

The RIA replaced that with new statutory language requiring that capital “remain invested for not less than two years” (INA 203(b)(5)(A)(i)).

USCIS interprets this to mean the two-year clock starts when the full qualifying investment is made and placed at risk, and not when the investor receives their conditional green card. In policy guidance posted on its website, USCIS states:

If the investor invested more than two years before filing Form I-526 or I-526E, the investment should generally still be maintained at the time of filing to allow USCIS to evaluate eligibility.

The Lawsuit

On March 29, 2024, IIUSA sued USCIS, claiming:

  • USCIS effectively shortened the sustainment period without going through the legally required notice-and-comment rulemaking under the Administrative Procedure Act.
  • Congress did not intend the RIA to reduce the investment horizon to two years.
  • A proper regulatory process should lead to a five-year standard.

July 29, 2025 Court Order

Judge Ana Reyes of the U.S. District Court for D.C.,

  • Denied IIUSA’s motion for summary judgment (a ruling without trial)
  • Denied USCIS’s motion to dismiss

The court found USCIS’s FAQ guidance was not final agency action and therefore not yet subject to judicial review. With USCIS committed to publishing a Notice of Proposed Rulemaking (NPRM) by November 2025, the judge held it was premature to rule on the merits.

Until then:

  • The two-year sustainment interpretation remains in effect for post-RIA investors.
  • Pre-RIA investors remain under the old conditional-residency-based standard.
  • Both parties must file status reports every 60–90 days.

USCIS’s Position

  • The two-year period reflects Congressional intent to decouple immigration timelines from capital lock-up.
  • Earlier liquidity benefits investors, especially those from backlogged countries, reducing the need for redeployment into secondary projects, often a source of frustration and risk.
  • Projects become more market-efficient, recycling capital into new job-creating ventures.
  • USCIS notes its guidance doesn’t require capital return in two years; it simply allows it. Regional centers can still set longer terms via terms and optional extensions stated in the private placement contracts.

IIUSA’s Concerns

  • Large, capital-intensive projects, especially real estate, often require 3–5+ years before funds can be returned safely.
  • A short window could invite bad actors to prioritize quick payouts over sound development.
  • The EB-5 program’s reputation could suffer if investors face losses or failed projects.
  • USCIS bypassed the formal rulemaking process, undermining transparency and industry input.

IIUSA proposes a longer sustainment period adopted through proper regulation and transitional protections for existing investors.

Why This Matters

  • For investors, the timeline affects when they can expect to recover their capital.
  • For developers, Shorter holds could make financing more challenging for long-horizon projects.
  • For the program’s integrity, Industry stability depends on both market discipline and investor confidence.

Both Sides Claim Victory

After the July ruling, both camps found reasons to celebrate:

  • IIUSA – Highlighted that the case wasn’t dismissed outright and that the court is requiring USCIS to stick to its rulemaking timeline.
  • USCIS – While silent publicly, retained its two-year policy in full force.
  • AIIA – An advocacy group supporting USCIS’s interpretation criticized IIUSA’s “victory” claim, noting the summary judgment was dismissed as moot.

The court did not decide on the core legal issue; it simply deferred it to the forthcoming regulatory process.

What’s Next?

Event Timeline
USCIS publishes NPRM By Nov. 2025
Status reports to court Every 60–90 days
Public comment period After NPRM
Possible final rule & merits ruling Late 2025–2026

Analysis

  • USCIS Strengths – Plain reading of statute, alignment with RIA goals, earlier liquidity, reduced redeployment risks.
  • IIUSA Strengths – Longer horizon for project stability, safeguards against abuse, fair process through formal rulemaking.

Final Thoughts

This case didn’t settle the EB-5 sustainment debate, it postponed it. The real fight will happen during the rulemaking process later this year, where industry voices will have their say.

For now, post-RIA investors face a two-year standard, pre-RIA investors remain under the old rule, and the EB-5 market operates under a cloud of uncertainty.

If stakeholders can use the upcoming public comment period to forge a practical middle ground, the outcome could strengthen both investor protection and program integrity.