Numerous EB-5 investors and their families have benefited from participating in the EB-5 investment industry and receiving U.S. permanent resident status. After making an EB5 investment in a U.S. business and creating 10 full-time jobs, foreign investors can qualify for green cards. Of course, the EB-5 program is beneficial to both the investor and the U.S. economy as a whole: investors gain permanent resident status, and the United States gains significant investment capital and a valuable new permanent resident.
Unfortunately, the productivity of the EB-5 program is dependent on government regulations, which can change unexpectedly. For example, on June 22, 2021, a federal court invalidated the Modernization Rule, which had raised the minimum EB5 investment amounts from $500,000 to $900,000 for targeted employment area (TEA) projects and $1,000,000 to $1,800,000 for non-TEA projects.
Only one week after the invalidation of the Modernization Rule, the regional center program was suspended. The U.S. Senate did not pass the EB-5 Reform and Integrity Act before the June 30, 2021 deadline and thus failed to reauthorize regional center EB-5 investment. While likely only temporary, this expiration created uncertainty among EB-5 investors. However, interested foreign nationals can still make a direct EB-5 investment.
An Overview of Direct EB-5 Investments
Unlike regional center investments, direct EB-5 investments are made directly to the EB-5 business in question. The job creation criteria for direct projects are restrictive: investors may only count jobs that appear on the business’s payroll. Because indirect and induced jobs cannot be counted, fulfilling the job creation criteria is harder for direct EB-5 investment projects.
As of June 30, 2021, EB-5 investors can only invest directly—United States Citizenship and Immigration Services (USCIS) released a statement on its website indicating that regional center I-526 petitions will no longer be accepted.
Why Do Investors Choose Direct EB-5 Investments?
Because of the active role that a direct EB-5 investor typically plays in the day-to-day operations of their project, many foreign nationals choose to invest directly. Direct EB-5 investors also benefit from the freedom to invest in many different types of businesses. They can even invest in a troubled business or open a new branch of an existing franchise. If they decide to invest in a new branch of a franchise, investors will benefit from the franchise’s expertise and success.
Direct EB-5 projects are an appealing choice for many foreign nationals looking to make an EB-5 investment. EB5 Affiliate Network offers potential investors the most reliable EB-5 projects in the industry.