An Interesting Approach to Economic Stimulation
(by Mark A. Ivener – Founder of the National Consortium of Immigration Law Firms (IMMLAW) and the Alliance of Business Immigration Lawyers (ABIL)
For nearly 3 decades, the EB-5 visa has been one of the most secure paths to obtaining a US Green Card. The program, established in 1990 to stimulate capital investment and job creation in the US, allows Green Card seekers to obtain a visa through investment in a qualifying US enterprise. Investment amounts have changed over time, and currently sit at $1 million for investments in most areas or $500,000 for investments in rural or high unemployment areas, deemed Targeted Employment Areas (TEAs). EB-5 investments must create 10 jobs for US workers by supporting the growth of projects that create new employment. Through the program US businesses are able to gain valuable cash influxes, while foreign investors are able to secure a path to permanent residence in the United States.
EB-5 Process Takes Time, but Is Worth It for Many Investors
The process to obtain a Green Card through the EB-5 program has been getting longer and requires the assistance of an experienced EB-5 lawyer. EB-5 Green Card seekers follow a process including the following key steps:
- The applicant analyzes potential investments to understand their business and financial merits
- The applicant selects a business and make a qualifying investment
- The applicant gathers the required documents and compile an I-526 Immigrant Petition by Alien Entrepreneur
- The applicant files the I-526 petition with United States Citizenship and Immigration Services (USCIS)
- USCIS will make a decision on the I-526 petition
- If USCIS approves the petition and the applicant is abroad, it will send the file to the National Visa Center (NVC) for review
- NVC provides a priority date to the petition, setting the timing for potential immigration to the US
- Once the priority date is current, the applicant submits DS-260 with all required supporting documents for NVC review
- NVC reviews all documents and processes the case
- NVC sends the case to the Consul in the applicant’s home country to inform an in-country interview
- The applicant and any relevant family members who are looking to immigrate through the EB-5 program interview with the Consul
- The visa will be approved or disapproved at this point. If approved, the Consul gets security clearances.
- The investor and their family may move to the US as conditional residents after clearance approvals.
- After a 21-month waiting period the investor may obtain removal of conditional status so long as their investment has been maintained and 10 jobs have been created
The EB-5 process takes about 3 years for most countries, but for applicants from high demand countries such as India, this is a significant improvement over wait times for many other visas. China wait times are now well over a decade, so here EB-5 is not a very attractive option.
EB-5 is Particularly Popular in Asia
During the 2017 fiscal year a total of 12,156 I-526 petitions were received of which 11,321 were approved. The majority of these applications came from mainland China. In 2016, the most recent year for which data is available, fully 82% of applications came from mainland China.
Following mainland China are Vietnam, which produces 3% of applications, and India, which produces 2.7% of applications. India, for its part, has seen rapidly rising numbers of EB-5 applications, especially as the Trump administration has tightened regulations on the H1-B visa for skilled workers.
A Low Volume, but Economically Important Program
Though EB-5 only accounts for a small percentage of total US immigration each year, its economic impact is significant. A study conducted by Western Washington University found that from 2014 to 2015 the EB-5 program likely generated $11.2 billion in investment and led to the creation of as many as 207,000 jobs. This job creation would have represented 4% of private sector job growth during the years reviewed.
EB-5 Is In a Period of Potentially Significant Change
Over the past year, the EB-5 program has been a hot topic in US immigration law. As immigration has become a focal point for many politicians, EB-5 has seen multiple proposals written and reviewed by Congress and the Department of Homeland Security (DHS).
At present the most likely changes appear to be increases in the minimum investment amounts for EB-5. As of April 2017, DHS provided an outline of proposed changes. This outline included increases for all minimum EB-5 investment amounts, to $1.35M in a TEA (up from $500K) and $1.8M outside of a TEA (up from $1M).
These changes could also be combined with increased measures to prevent fraud and tightened TEA qualifications that would decrease the number of projects that fall into this qualification.
These changes would almost certainly reduce the number of EB-5 applications received each year as they would make it both more expensive and more difficult to obtain an EB-5 visa. At present the EB-5 industry is watching closely the decisions made both by Congress and by DHS. Congress, for its part, recently extended its legislation on the matter to remain in place through September 30, 2018. However, DHS has the right to make meaningful changes to the EB-5 program, including raising investment amounts, so we may see changes sooner than September.
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