Signiﬁcant changes in the EB5 Green Card program
EB5 Green Card program is undergoing signiﬁcant changes, fundamentally altering the equation for Silicon Valley professionals exploring this route. On July 24, 2019, the new EB-5 regulations were published in the Federal Register. The new rules are scheduled to take eﬀect on November 21, 2019. The most important change is in the investment amount which has been increased from $500,000 to $900,000.
Introduction Investment-linked EB5 green cards have emerged as a popular choice for aspirants as there are fewer restrictions in comparison to other visa categories. The EB5 Program gives high-net-worth individuals an opportunity to get permanent residence in the United States not only for themselves but also for their spouses and children under the age of 21. An EB5 investor is currently required to invest $500,000 in projects in the United States and generate 10 jobs for US citizens. EB5 investor-families get green cards after their applications are approved, as opposed to other employment-based visa categories such as H-1B and L1 visa, which only grant work permits. An EB5 investor does not need an employer to sponsor his/her petition and can enjoy the freedom of living or working anywhere with any employer of their choice in the United States. Many Silicon Valley professionals facing long wait times for a Green Card due to H1B-EB2/EB3 queues have been using the EB5 Visa program as a prompt way to obtain legal permanent residency.
Anticipated higher wait times
Over the past 2/3 years, hundreds of Indian born applicants – residing in India as well as in the United States on H1B have been applying for the EB5 visa. This has obviously resulted in a long queue. As a consequence, the wait times for a green card under this program have increased manifold. On May 6, 2019 at the IIUSA Conference in Washington, D.C. Mr. Charles Oppenheim, Chief of the U.S. Department of State Visa Control and Reporting Division presented projections of estimated wait times for immigrant investors ﬁling a petition now. The wait times for Indian born applicants ﬁlling today, according to those projections, is expected to be above 8 years. For prospective applicants who wait longer to decide, the anticipated wait times could even be higher.
Retrogression & Backlog USCIS has allocated a quota of only 700 applications per country each year. This limitation and the tightening the laws for other visas made people desperate to ﬁle their I-526 application as soon as possible to avoid longer wait times. Huge rush of applicants and lesser number of commensurate visas has resulted in a backlog and retrogression. Eventually as widely expected this resulted in EB5 visas being no longer “current” as of July 2019.
Removal of country caps On July 10, 2019, the U.S. House of Representatives passed the Fairness for High Skilled Immigrants Act of 2019 (HR1044). The bill, if enacted, would remove the 7% per country cap on employment-based visas, including EB5visas, thereby creating a single line on a ﬁrst-come ﬁrst-served basis for visa availability. The Fairness for High-Skilled Immigrants Act is good for everyone in EB5 with an older priority date but can be deterrent for anyone who doesn’t want to move back in line behind the existing backlog. In simple terms, if the Senate also passes this act (or a similar act having the same eﬀect of removal of country caps) then Indian EB5 applicants could face even longer wait times.
New regulations with higher investment amount to be eﬀective from November 21, 2019
On July 24, 2019, the new EB-5 regulations were published in the Federal Register. Investment amounts have been increased from $500,000 and $1,000,000 (direct EB5) to $900,000 and $1,800,000 (direct EB5), respectively. The TEA qualiﬁcation criteria and designation process have also changed. These regulations are the ﬁrst major overhaul of the program announced since the program was established in 1990. These new rules are scheduled to take eﬀect on November 21, 2019. Prospective investors can still invest under the current investment amount of $500,000 and TEA deﬁnition till November 21, 2019.
Speedy and correct decision making is of the essence to capture the window of opportunity. In summary, these four important changes: Higher wait times, retrogression, new regulations and removal of country caps; could create a volatile environment for Silicon Valley professionals evaluating EB5 Green Card program. For many Silicon Valley professionals currently on H1B, 5the EB5 route may still be attractive. Such applicants who can move fast may be able to ﬁle their petitions before these new rules and laws become applicable and wait times get even longer. Speed of decision making and choosing the right immigration attorney and safe regional center is of paramount importance.
Rely on experts to navigate these changes
EB-5 is a multifaceted program and an experienced EB5 regional center & immigration attorney is a must to assist the investor with the intricate procedures. Working with attorneys and regional centers which can prove that they have a solid track record with a signiﬁcant number of petition approvals, thousands of green card issuances, as well as timely and full principal repayments, is a vital part of the EB5 process that will save investors both time and possibly additional expenses. As with any investment, if the promises sound too good to be true, they usually are. Investors should not be swayed by promises of fantastic returns and remain focused on the primary goal of the EB5 investment – which is obtaining a green card in a safe legal, manner with capital protection. It is essential that investors focus on immigration attorneys and regional centers with transparency, credibility and a proven track record of EB5 projects.
[Nilesh Shah is an Investor, based in silicon valley. These are the author’s personal views. These are the author’s personal views. This note is not intended to be legal or investment advice. Prospective investors should seek inputs from licensed immigration attorneys, securities broker/dealers, and other competed professionals. ]