President Obama's Recent Immigration Polices and EB-5 Impact
Chinese viewers can see the video here.
President Obama’s Recent Immigration Polices and EB-5 Impact
President Obama has recently announced some new proposed changes in immigration policies that, generally, impact the immigration and others that can specifically impact EB-5. The purpose of this article is to outline the measures that could impact EB-5.
On the President’s trip to China he announced that Chinese nationals would be eligible to apply for a ten (10) year tourist visa. This has caused some Chinese to think that there is no reason to apply for residency via EB-5. This reasoning is incorrect for a few reasons. First, while the individual is eligible to receive a visa for ten (10) years, it does not mean that the person will receive a visa for ten (10) years. The consulate may choose to issue it for one (1) year. Second, an entry on a tourist visa is for six (6) months. And, third – most importantly – a tourist visa allows a person to vacation in the U.S. That person cannot study or reside permanently in the U.S. Thus, the EB-5 classification should still be pursued if an individual desires to reside or study in the U.S. Next we move to the most recent Executive Action on Immigration by the President.
On November 20, 2014, President Obama outlined changes that would take place without regulatory change, with regulatory change, and a Presidential Memorandum on Visa Modernization. The proposed changes that could potentially impact EB-5 are discussed below.
As it relates to Administration Guidance without New Regulation, it appears that there will be no significant impact on EB-5 as the majority of those changes relate to other visa classifications or those that have been in the U.S. since January 1, 2010.
With respect to Regulatory Changes through the Administration Procedure Act, there are two (2) key points that could provide a benefit to the EB-5 investor. First, is the goal to enable entrepreneurs to be paroled into the U.S. and work if they are researchers, inventors or founders of businesses. The EB-5 community needs to insist that this should apply to EB-5 investors, as by definition they are “alien entrepreneurs.” If this were to apply to EB-5 investors, then the investor would be permitted to enter the U.S. even before the residency was approved. This would be a tremendous benefit to the investor and family.
Second, and having a similar impact as the first, is “early adjustment.” This would enable individuals who are eligible to apply for adjustment of status, but for a non-current priority date, to file for adjustment and receive work authorization and advance parole. Therefore, if the I-526 petition were approved, the EB-5 investor and family could file for adjustment of status and receive the above-mentioned benefits. The EB-5 community needs to ask the administration to also allow for EB-5 investors outside the U.S. to receive the same treatment as those inside the U.S. who file for “early adjustment.” In the context of the residency process for a foreigner married to a US citizen, if an I-130 is filed for the foreigner who is outside the U.S., the foreigner can file for a K-3 visa to enter the U.S. while waiting for the residency process. Something similar should be extended to those EB-5 investors outside the U.S. Lastly, we move to the memorandum.
The Presidential Memorandum on Visa Modernization has two points that could positively impact EB-5 investors. First, there is a possibility of recapturing permanent resident numbers based on numbers allocated by Congress but left unused. So, in effect, the additional visas would be carried over to the next year’s available numbers. Therefore, if there is over demand based on the number of visas allocated to EB-5 in one specific year, there exists the possibility that the unused visas from previous years could be used in order to better effect Congressional objectives. This would have a large impact on EB-5 especially if the President allowed the State Department to go back five (5) years or more and recapture the thousands of unused immigrant visas in the EB-5 classification during those years. This would, in effect, ensure there would not be retrogression this year.
Second, and even more impactful, is the possibility of not counting derivative spouses and children toward the Eb-5 visa quota. Currently, when an EB-5 investor files for and has an approved I-526 he and his family count again the 10,000 EB-5 immigrant visa cap. Assuming that the average is three (3) in a family (husband, wife, and child), this means that only 3,333 investors could receive their residency in any given year. However, if the derivatives are not counted, it is clear how that number would be tripled to 10,000 investors. This impact is huge in that it would also substantially reduce the risk of retrogression in the EB-5 classification.
It is important to note that President has set a goal of 120-180 days for the Presidential Memorandum on Visa Modernization. Thus, we are hopeful to see some guidance within the next six (6) months.
The President has set forth some proposed changes that could positively impact the EB-5 community. It is now up to us to lobby the administration to follow though on those proposals so that EB-5 remains strong for businesses and investors.
 The President also proposed expanding the availability of optional practical training for graduating F-1 foreigners and expanding the definition of STEM which could benefit some children of potential EB-5 investors.
Jeff Campion is the ceo of Pathways EB-5, Inc. which has a family of Regional Centers including the Northeast Regional Center, Sunshine State Regional Center, Gulf States Regional Center, Midwest Metropolitan Regional Center, and Texas Urban Triangle Regional Center. Moreover, Mr. Campion is an attorney that focuses on representing high net-worth foreign clients and their businesses. He regularly counsels Regional Centers as to EB-5 compliant projects and reviews EB-5 projects for clients relating to Eb-5 compliance and immigration risk. He was selected to the “Top 25” EB5 attorneys list of 2013 and 2014 by EB5 Investors Magazine, is a member of the AILA EB-5 committee, former member of IIUSA best practices committee, and a founding member of EB5IC.
Laura Foote Reiff focuses her practice on business immigration laws and regulations affecting U.S. and foreign companies, as well as related employment compliance and legislative issues.
Laura represents many businesses in creating, managing and using "Regional Centers" that can create indirect jobs toward the 10 new U.S. jobs whose creation can give rise to EB-5 permanent residence for investment. She coordinates this work with attorneys practicing in securities law compliance, with economists identifying "targeted employment areas" and projecting indirect job creation, and with licensed securities brokers coordinating offerings. She also represents individual investors in obtaining conditional permanent residence and in removing conditions from permanent residence.