For foreign national investors, the EB-5 program is an excellent opportunity to gain lawful permanent residence (LPR) status in the United States through creating jobs and stimulating the economy. In 1990, Congress created the EB-5 Immigrant Investor Program hoping that foreign investors' capital and job creation will boost the United States' economy. The country's business market flourished, and the EB-5 program continues to offer many opportunities to foreign investors and United States citizens.
In the last few years, many changes in the EB-5 program have left investors looking for answers. Traditionally, there were three separate ways an investor could acquire LPR status through the EB-5 program. The requirements for an investor changes based on the track investors chose, so with the new changes disrupting one of the tracks, understanding the alterations is crucial to your investment.
Changes Made to the EB-5 Visa Program in June 2021
A California District Court vacated the 2019 EB-5 Immigrant Investor Program Modernization Final Rule in the case Behring Regional Center LLC v. Wolf on June 22, 2021. Magistrate Judge Jacqueline Scott Corley of the U.S. District Court for the Northern District of California invalidated the regulations enacted in November 2019 because they were not lawfully promulgated.
Due to the ruling, the U.S. Citizenship and Immigration Services (USCIS) has made the changes below:
- The Federal Court ruled that the changes made in November 2019 were invalid. These changes included altering the definition of a TEA area and raising the minimum investment of a TEA-based project to $900,000 and $1.8 Million for Non-TEA projects.
- The Regional Center Program, initially a Pilot Program, was allowed to expire on June 30, 2021. While the sunset date for the Regional Center program always had an expiration, Congress has almost always extended the deadline. However, the program was allowed to expire without any extension.
While the Regional Center program is no longer accepted as an investment option, there are other ways foreign investors can still participate in the EB-5 visa program. Because changes to the EB-5 program are still ongoing, it's critical that you work with an experienced EB-5 Attorney.
What Is the Direct Investment Program?
The main difference between the Regional Center program and the traditional direct EB-5 investment program is that the Regional Center program counts direct, indirect, and induced job creation to meet the 10-job requirement; the direct investment program only counts direct job creation. Those using the direct investment option must invest in a commercial business that directly creates at least ten new full-time direct jobs. Now that the Regional Center program is no longer available to investors, the traditional direct EB-5 investment program requirements are in effect:
- The investment must be in a new commercial enterprise or one established after November 29, 1990. If the business was established before November 29, 1990, it has to have been restructured to result in a new enterprise or a 40% increase in the net worth or number of employees.
- The investment is at least $1 million unless the enterprise is located in a targeted employment area (TEA) or rural area (RA), where the investment must be at least $500,000.
- Proof that the investment will directly create at least ten full-time jobs within two years.
- The investor must take an active role in business operations.
- The funds must be from a lawful source.
Most people believe that the Regional Center program will be reauthorized, but the re-authorization must come from Congress. It is unknown when or if the Regional Center program will come back into effect. Until then, the traditional direct investment method is in full effect.
Contact an Experienced Washington EB-5 Visa Lawyer
Having an experienced EB-5 Visa lawyer by your side during change can help you navigate the requirements and necessary documentation. Our team at Orbit Law can help guide you through the process, arrange site visits if available, and answer any questions about the current changes within the program.
With over ten years of experience in the EB-5 visa program, we are proud to have 100% approval on all EB-5 related cases filed. We offer clients accessible communication and dependable legal services that they can count on.
Call (206) 623-3352 or fill out our contact form for more information about our services.