Thanks to the new EB-5 Reform and Integrity Act (RIA) which was signed into law in March 2022, and the five-year renewal of the Regional Center Program (through September 2027), the EB-5 Immigrant Investor Program is more appealing than ever as the most effective and efficient route for foreign investors seeking a Green Card.
Skip the Line
The passing of the RIA enforced several appealing benefits for foreign national investors, such as quicker processing times for regional center program investments in a targeted employment area (TEA).
Recent increases in real estate costs have made seeking EB-5 investor financing progressively more attractive, and there has been a marked swell in interest from real estate development projects and regional centers in the EB5 Immigrant Investor Program as a result. Moreover, the RIA now grants priority processing status to EB-5 applicants who make a capital investment in an EB-5 commercial enterprise in a rural TEA.
Set aside visa categories and priority processing are important benefits given the growing queues for EB-5 visa petitions. This will prove exceptionally useful for investors from countries with a higher demand for EB-5 visas, such as China, India, and Vietnam.
TEAs have now been granted 32% of the annual allotment for visas. Investors who qualify for both TEA investment and set aside status, followed by approval of their Form I-526E, can receive their visa regardless of the current demand or remaining availability of visas from their country of origin.
A new perk of the RIA allows investors to choose to remain in the U.S. and apply for a Green Card without having to travel and wait in their country of origin. This ability to adjust your visa status from within the U.S. is stirring interest from potential EB-5 investors with temporary residency currently residing in the U.S. on any non-immigrant visas.
This could prove especially engaging for many H1B visa holders who may have been laid off as a result of the recent economic uncertainties. Equally enticing is the benefit to families with children who would like to avoid disruption to their child’s academic schedules and social development.
Making the EB-5 further appealing, is a shorter list of requirements when compared to other immigration visa options. EB-5 visas do not require the applicant to have business management experience, provide proof of any higher education, or even speak English.
The RIA also comes with new security measures including requiring regional centers to provide investors with their audited financial statements and making all disclosures prior to investors providing their capital investment funds.
A crucial additional requirement is the enforcement of using third-party or independent fund administrators for extra transparency. Generally, the role of an administrator is to prepare financial documents, track income and expenses, monitor assets, enforce compliance checks, verify fund transfers, coordinate audits, and act as a liaison between the fund and participating investors. This provides critical safeguards for all parties, and ensures that innocent mistakes nor intentional predatory practices can go unchecked.
In addition to the legal assurances this provides, this best practice also avoids delays in the development projects, and in the case of EB-5 investors, the immigration process.
All of this is essential to raise the standard of responsibility of regional centers that participate in the immigrant investor program, providing an additional layer of assurance for foreign investors.
Regional Centers Are the Way to Go
Although the RIA is good news in terms of renewal of the regional center program and protections for investors, this has all led to an increase in demand, and foreign investors are encouraged to file their I-526E petitions as soon as possible. Prior to the RIA, there was a backlog of applications which United States Citizenship and Immigration Services will need to clear before processing the new incoming applications, making wait times unpredictable.
Additionally, due to the 7% cap on the amount of EB-5 visas that each participating country can receive and the cutoff dates in the State Department’s Visa Bulletin, longer processing times seem like a very real possibility. This makes direct investment a less practical choice for EB-5 investors.
Under the RIA, even established regional centers were required to submit and garner the approval of Form I-956 in order to maintain their designation. This process required applicants to demonstrate their compliance with all new and updated standards and regulations in the RIA.
While foreign investors are encouraged to act fast, they would still benefit from thorough due diligence on topics varying from risk evaluation, and available EB-5 commercial enterprise investment offerings, to the requirements and long term benefits of U.S. permanent residency. It is valuable to use established regional centers and their resources to avoid unnecessary risks or mistakes in the process. Retaining an experienced immigration attorney to assist, and navigate the complexities of United States Citizenship and Immigration Services applications is also highly recommended.
Schedule a free consultation with EB5AN to learn more.