BERNIE'S TOP 5 EB-5 HOT TOPICS
I just returned from my third trip to China this year.
Here are 5 observations regarding the EB-5 program.
- Demand for permanent residency under the EB-5 program remains strong as news of the inevitable minimum investment amount increase sinks in. In the first 7 months of Fiscal Year 2015, 88.56% of investors came from China with a total of 6,819 Vietnam had the second highest percentage of investors. Using 244 visas. The other three countries in the Top 5 are also from Asia. Taiwan is in 3rd place with 83, India in 4th place with 58 and South Korea is in 5th place with 54 visas issued. China is still dominating the investor program.
- Potential investors want to know the effective date of the increase and the precise amount. In my previous blogs, I have mentioned the amounts I have heard: $800,000 for TEAs and $1.8m for non-TEAS. As for the effective date, if Congress includes an increase as part of an extension package, one can only hope the effective date is at least October 1, 2016. If DHS exercises its current authority, the increase could be in the regulatory package presently being drafted. Regardless of which option materializes, let’s hope there it contains an adequate grandfathering provision for pipeline projects.
- The China EB-5 cutoff date of May 1, 2013 is creating concern but not panic as potential investors try to understand the impact of the quota. Investors want to know how long the waiting line will be if they file now and of course the critical question is what will happen to the more than 13,000 pending cases? The Department of State won’t speculate on future movement of the waiting line, but I will share informal chatter that I heard: by September 2016, The Department of State will be processing cases from about summer 2014. That’s a wait time of only about 27 months which really isn’t so bad. We are already at 25 months and since the May 1, 2013 China cutoff date has “stabilized” we are unlikely to see actual retrogression. Again, it is important to remember that retrogression occurs when the cutoff date goes backward. Thus far, the cutoff date has only been established, but that date has not gone backward or retrogressed. Misusing the phrase will make it difficult to understand the visa regulatory framework.
- And what about the Chinese children? Well, to me it’s relatively clear. If the child is 18 years old or older, the child better file as the principal applicant. If the child is 14 to 17 years old, the parents should file now or risk having the child age out. It really was sad meeting with some parents who filed their I-526 too close to their child’s 21st birthday. Many were praying for RFEs that would give their kids a few extra months to subtract when calculating their CSPA age. EB-5 attorneys are finally getting it. You can’t freeze the child’s age unless a visa number is available as published in the visa bulletin. Sure you have 12 months to lock in the child’s age and another 12 months if the priority date is backlogged, but meanwhile the child’s age is advancing from the day the I-526 is approved. In our strange “mad hatter” world many with pending I-526 application are desperately hoping not to get fast approvals. I explained I would include requests to delay adjudication with RFE responses, but I’m not sure USCIS will agree to do so.
- And the fifth tidbit? Well, in addition to many new projects on the market, there are many new agents as China rapidly deregulates the licensing of migration agents and wealth management companies enter the market to meet customer demand. “I really can get an American green card for only a $500,000 investment” is something I repeatedly hear. Many of the projects seem very good as reputable developers and others dive into the so-called cheap money EB-5 arena. (That’s a myth as it really isn’t that cheap and many good projects can now get cheaper bank financing as capital markets improve in the U.S.). A few of the licensed Chinese Migration Agents and Regional Centers continue to dominate with robust strategies that continuously dismantle their competition.
This post originally appeared on Wolfsdorf Immigration Law Group. Reprinted with permission.
Bernard Wolfsdorf is a recent past President of AILA and Managing Partner of the top-rated Wolfsdorf Rosenthal LLP with offices in Los Angeles and New York. With 21 lawyers and 60 professionals, the firm is known worldwide for its excellence in providing value and top-quality global immigration representation. Wolfsdorf Rosenthal LLP has been described by Chambers USA as "a force to be reckoned with."