An article for IMGW NEWS by Rahul Soni, Partner and Eduardo Garcia, Associate, Fragomen
The EB-5 Immigrant Investor Programme has experienced a surge in popularity among individuals from around the globe as it continues to present an attractive opportunity for foreign investors seeking a path to permanent residency in the United States. Changes over the past several years have further increased investor interest in the programme, not only as a means for financial growth but also for fulfilling their aspirations of primary or secondary residency benefits in the United States. Indeed, the EB-5 programme stands as more than just an investment channel; it serves as a bridge connecting an investor’s residency needs to sustainable economic development.
The EB-5 investor visa programme provides an extraordinary opportunity for foreign nationals to secure permanent residency in the United States, thereby offering a pathway towards U.S. citizenship for the investor and their immediate family. Unlike traditional employment-based permanent residency pathways, the EB-5 programme does not impose specific educational or professional work experience requirements. Most importantly, under current green card processing times, the EB-5 green card process is one of the fastest ways to obtain permanent residency in the United States, and timing is incredibly more favourable than more traditional employment-based green card pathways.
What Legislative Changes Mean for Foreign Investors
In December 2020, Congress enacted the EB-5 Modernisation Rule, introducing several key revisions to the programme, including updates to investment thresholds and Targeted Employment Area (TEA) designations. Additionally, when Congress reauthorised the EB-5 “Regional Center” Programme in March 2022, it introduced three “set-aside” designations to expedite the adjudication of the initial I-526 petition with the U.S. Citizenship and Immigration Services (USCIS). These “set-aside” categories include rural projects, high unemployment area projects, and infrastructure projects. Fragomen’s comprehensive analysis of adjudicatory trends has revealed that USCIS is currently approving I-526 petitions filed under the rural sub-category within three to six months in many instances, while applications filed under the high unemployment area designation are still being adjudicated quickly, within approximately twelve months. This quick adjudication is a drastic improvement from the four, five, or even six years USCIS previously took to adjudicate I-526 petitions before the introduction of the “set-aside” categories.
Entities which are approved by the USCIS to sponsor EB-5 projects have been actively promoting various investment opportunities, some more viable than others. Working with reputable regional centres plays a crucial role in facilitating EB-5 investments by identifying viable projects, conducting due diligence, and managing the immigration process for investors. By participating in the EB-5 programme, investors can gain access to the U.S. market, potentially benefiting from the myriad opportunities available in sectors such as real estate, hospitality, infrastructure, and technology. Moreover, the programme fosters stronger business ties between a home country and the U.S., facilitating collaboration and economic growth. From a global perspective, the EB-5 programme provides investors with a pathway to geographic diversification and risk mitigation, making it even more attractive in the context of this dynamic and prosperous market.
Investors should note that in working closely with top regional centres, every project requires bespoke and careful guidance to navigate the intricacies of any given individual EB-5 offering. Consequently, investors stand to gain significantly by possessing a profound understanding of the implications associated with their project selections, as well as the nuanced advantages and challenges intrinsic to expedited categories.
Challenges and Opportunities
Despite its popularity, the EB-5 programme, like many immigration pathways, is not without challenges as applicants face delays in visa processing, uncertainties surrounding policy changes, and concerns over project viability and compliance. Additionally, as of 1 April 2024, and while currently being challenged in court, USCIS has implemented new immigration application and processing fees, with those related to EB-5 increasing nearly 200%.
With a rematch of the 2020 election featuring former President Trump and President Biden, investors, among countless other intending immigrants, are closely waiting to see what happens, given the possible impact on immigration policy. While Congress is generally responsible for making the laws in the U.S., presidents can and do use their administrative power to amend laws in various ways. For instance, a president can issue executive orders to implement policies and direct federal agencies, bypassing congressional approval in many instances. Additionally, presidents appoint key officials, including cabinet members and agency heads, shaping the direction of government policies and enforcement. A potential return of the Trump administration may significantly impact U.S. immigration, as witnessed during his prior term.
Notably, during the previous Trump administration and under the current Biden administration, the EB-5 programme continued to operate without significant impact. The EB-5 programme incentivises foreign investment in Targeted Employment Area (TEA) designations such as high unemployment rates or rural areas, leading to job creation and economic development in various sectors. Both parties generally support policies that promote economic growth and job creation. Moreover, Congress’s recent reauthorisation of the Regional Center Programme through Fiscal Year 2027 provides further stability and assurance to investors and stakeholders contemplating an EB-5 investment and is indicative of the likelihood of insulation from broader immigration policy changes.
Looking Ahead
There are many positive signs that the EB-5 programme will continue to rise in popularity due to its offering of expeditious U.S. permanent residency. Interested investors are at the perfect moment to capitalise on the current favourable EB-5 investment conditions and maximise its potential to drive economic growth and facilitate global mobility.
About the Authors
Rahul is a Partner in Fragomen’s New York office, where he represents individual and corporate clients in a variety of private client, employment-based and family-based immigration matters. He represents top global financial services, technology and professional services organisations, and a broad range of corporate clients and individuals across numerous industries, including science, medicine, education, athletics, fashion, motion picture and television. Rahul also advises high net worth individuals on their immigration-related investments, with a notable focus on EB-5 investor visas for clients based in Europe, Asia, the Middle East and Latin America, as well as global citizenship and residency by investment options. He can be reached at [email protected].
Eduardo is an Associate in Fragomen’s San Francisco office where he collaborates with clients to devise tailored solutions for their corporate immigration requirements. Eduardo specialises in EB-1/NIW permanent residency petitions, EB-5 petitions, and O-1 non-immigrant visa petitions. He adeptly navigates clients through each phase of the case process, from inception to petition submission, ensuring a seamless experience. Eduardo can be reached at [email protected].