As the entire world contends with the unprecedented threat of COVID-19, the EB-5 Immigrant Investor Program continues, allowing foreign nationals to gain a U.S. green card for an investment in a qualifying EB-5 project. At the height of the pandemic, United States Citizenship and Immigration Services (UCSIS) temporarily shut its public offices in all parts of the country, reopening them only on June 4, 2020. However, throughout the entire crisis, it has continued to process I-526, I-829, and I-485 petitions for EB-5 investors.
Though USCIS offices have now been reopened and are offering in-person appointments and interviews, those who receive a request for evidence (RFE) or notice of intent to deny (NOID) before July 1 will still be granted 60 additional days to respond. USCIS is offering deadline extensions for RFEs and NOIDs issued between March 1 and July 1, outlining the details on its “Response to COVID-19” page. The deadline indicated on the notice is the original deadline, but applicants are permitted to submit their response up to 60 days past the original due date.
2020 has been one of the most unpredictable years in recent history, so the future of the EB-5 program in 2020 is inevitably difficult to foresee. The state of the program in 2020 is reliant upon developments surrounding the pandemic and will vary dramatically depending on whether a second wave strikes. It is, however, still possible to speculate on what will happen with the EB-5 program going forward in 2020.
Lawyers Might Become More Involved in the EB-5 Program
The exceedingly low adjudication rates in FY2019 at the Immigrant Investor Program Office (IPO) are no secret and are especially noteworthy when compared to the unusually high processing rates of FY2018. The main difference between the two fiscal years is the shift in management, with Sarah Kendall taking over as chief in FY2019. The shift in management style seems to have spurred record-low processing times that have eroded trust in the program and forced some prospective EB-5 investors to consider immigration options in other countries.
The IPO’s failure to fulfill its processing duties in 2019 went largely unpunished despite the frustration among investors and industry participants. The pandemic may set a different course for 2020: Lawyers have limited work during the pandemic, which may cause them to eye the EB-5 program as an additional route of revenue, assisting EB-5 investors with lawsuits against USCIS for its unreasonable adjudication practices. The IPO’s processing failures are not only hurting investors but also erasing the original purpose of the program: to foster the U.S. economy and create jobs. With such slow processing, job-creating entities (JCE) have limited access to EB-5 funds, curtailing the job creation process—at a time when jobs are needed more than ever. Lawyers’ aid with investor lawsuits, as well as IIUSA’s planned confrontation of UCSIS, may alter the outlook.
The Distribution of EB-5 Visas in FY2020 is Messy and Uncertain
All U.S. embassies and consulates in the world have temporarily halted their routine visas processes since March 2020, effectively stopping consular EB-5 processing. Since overseas EB-5 investors are no longer able to schedule visa interviews or appointments, they have no choice but to wait until the consulates reopen. As of June 15, 2020, the embassies and consulates in China, India, and Vietnam—the three largest EB-5 countries—remain closed, meaning thousands of EB-5 visas that, under normal circumstances, would be issued will be unable to be granted in FY2020.
At the beginning of FY2020, the Department of State announced a total of 11,112 EB-5 visas available for the fiscal year. Indian and Vietnamese EB-5 investors were set to receive 778 visas each, leaving approximately 5,270 leftover visas to allocate to Chinese investors. Generally, EB-5 visas are distributed equally throughout the year, with approximately the same number being issued each quarter, but the worldwide health crisis and associated lockdowns of 2020 have disrupted the regular distribution. The actual number of visas issued is far lower than the expectations put forth in October 2019, long before officials knew of COVID-19.
What Will Happen to FY2020 EB-5 Visas?
To say 2020 is an unusual year is an understatement. Accordingly, FY2020 is an unusual year for the EB-5 program, and the future of the FY2020 EB-5 visas is unclear. Below are a few possibilities:
Domestic EB-5 Investors Claiming EB-5 Visas
While all EB-5 investors are foreign nationals, not all reside overseas when making their investment—some are already U.S. residents on other visas. Domestic investors can claim EB-5 permanent resident status with an I-485 petition, simply changing their immigration status. The number of pending I-485 petitions is not publicly released information, so it’s difficult to say how many EB-5 visas domestic investors could account for. However, historically, the number of domestic investors has been small, and the quick advancement of the final action date in the months of the pandemic suggests the share in FY2020 is similarly small. Therefore, there may still be numerous EB-5 visas left even if all domestic investors claim their visas in FY2020.
A Surge in EB-5 Visas Issuances
The future of the FY2020 EB-5 visas rides on the embassies and consulates. If they reopen soon, investors abroad will be able to book their visa appointments and claim their EB-5 visas in FY2020. If the reopening process is quick enough—and the IPO picks up the pace—it may be possible to dole out all the allocated EB-5 visas by the end of FY2020 on September 30, 2020. Most important are the Chinese embassy and consulates—even if only the Chinese embassy reopens, a significant number of EB-5 visas could be claimed.
A Rollover to EB-1 in FY2021
If the embassies and consulates don’t reopen in time, the EB-5 program risks permanently losing the visas allocated to it in FY2020. Any leftover visas USCIS can’t grant before September 30, 2020, will be allocated to EB-1 in FY2021, which would only serve to increase the growing EB-5 backlogs and further erode investor trust in the program.