The EB-5 Immigrant Investor program, the investment immigration program of the United States, has gone through turbulent times over the course of the past two years. The EB-5 program has been amongst the most popular U.S. immigration programs for residents of the Middle East and wider emerging market regions as it allows investors to obtain U.S. Green Cards for themselves and their qualifying family members - including spouse and unmarried children under the age of 21 - with an investment of $500,000 into a new commercial enterprise in the United States.
The EB-5 Regional Center program, which allows investors to take advantage of the immigration benefits with a passive investment, lapsed on June 30, 2021 and has remained suspended for the past six months. This current lapse in the EB-5 Regional Center program has been the longest since its inception by the U.S. Congress in 1992. According to a report published by Invest in the USA (IIUSA), a not-for-profit industry trade association for the EB-5 Regional Center program, the lapse has affected nearly 32,600 EB-5 investors with pending I-526 petitions and put over $15 billion in capital investment and over 486,900 U.S. jobs at risk. Given the magnitude of the number of investors and the capital at jeopardy, the general consensus among key EB-5 industry stakeholders is that the EB-5 program will soon be reauthorized in early 2022.
The EB-5 program did not receive reauthorization from Congress because Democrats and Republicans have since December 3, 2021 been unable to agree on a federal budget and the reauthorization was not included in the Continuing Resolutions that were passed in order to avert a U.S. federal government shutdown. However, with U.S. congressional elections coming up in 2022, it is unlikely that a long Continuing Resolution will once again be passed. It is expected that the federal budget bill will be agreed upon by Democrats and Republicans by the end of February 2022 at the latest.
With reauthorization expected to occur in February 2022, the year ahead for well-prepared prospective EB-5 investors is a positive one. There are currently two legislative bills being considered by the EB-5 industry. Regional centers and other active players in the industry are in favor of a draft legislation, which contains many positive protections for EB-5 investors, including but not limited to no longer being affected by lapses in the EB-5 Regional Center program.
Additionally, it is likely that there will be a parole option, whereby if an investor’s EB-5 petition has been pending for over two years and there has been no action by the United States Citizenship and Immigration Services (USCIS) on the file, the investor will be able to obtain a work permit to live and work in the United States. With the parole option, EB-5 investors are able to begin their lives in the United States regardless of the status of their EB-5 applications. Another change will likely be to the government filing fees, which will increase to $50,000. If a petition has not been reviewed after 24 months, the $50,000 fee will be returned to the investor. The deadlines set on USCIS for the review of an investor’s EB-5 petition provide an incentive to speed up the process.
Furthermore, the EB-5 legislation is likely to maintain the required capital investment at $500,000 for the initial 30 to 60 days, after which it will gradually increase by $100,000 increments on a year-to-year basis. “With the price increase being a real possibility, we are encouraging all of our clients and prospective EB-5 investors to be prepared so they can benefit from the lower ticket price as soon as the program is reauthorized,” says Shai Zamanian, Legal Director of The American Legal Center, a top immigration consulting firm in Dubai.
The many months of delay of reauthorization and the understandable frustration of EB-5 investors is soon expected to come to an end. Key EB-5 industry stakeholders anticipate that the program will be reauthorized in the first quarter of 2022. With reauthorization right around the corner, the best course of action for prospective EB-5 applicants is to begin collecting their documents in order to file their applications at the lower required investment of $500,000 as soon as reauthorization becomes a reality.
