EB-5 Reform and Integrity Act of 2022

The 2022 Consolidated Appropriations Act was signed into law in March of 2022, and with it came a major reform to the EB-5 system.
The relevant portion of the Act is Div. BB, otherwise known as the EB-5 Reform and Integrity Act of 2022.

Full Bill Text

Important Takeaways:

More Resources:

EB-5 Uncategorized

EB-5 Updated Investment Cost

The EB-5 Reform and Integrity Act also lays out changes to the EB-5 investment cost.
The new cost is effective March 15, 2022, and will be adjusted by inflation every 5 years based on the Consumer Price Index for All Urban Consumers (CPI-U).

Investment TypeBeforeAfter
Minimum Investment$1,000,000$1,050,000
Targeted Employment Area Investment Amount$500,000$800,000
High Employment Area Investment Amount$1,000,000N/A

These values are given in US Dollars.

A Target Employment Area is either (at time of investment):

  1. A rural area, or
  2. A high unemployment area.

Source: USCIS


EB-5 Immigrant Visa Set Asides

The EB-5 Reform and Integrity Act dictates that a certain percentage of EB-5 visas will be set aside for investors who invest in specific areas each fiscal year, the breakdown is as follows:

  • 20% – Rural
    A rural area is any area other than an area within a metropolitan statistical area (MSA) (as designated by the Office of Management and Budget) or within the outer boundary of any city or town having a population of 20,000 or more according to the most recent decennial census of the United States.
  • 10% – High Unemployment
    A high-unemployment area consists of the census tract or contiguous census tracts in which the new commercial enterprise is principally doing business, which may include any or all directly adjacent census tracts, if the weighted average unemployment for the specified area based on the labor force employment measure for each tract is 150% of the national unemployment average.
  • 2% – Infrastructure
    An infrastructure project is a capital investment project in a filed or approved business plan, which is administered by a governmental entity (such as a Federal, State, or local agency or authority) that is the job-creating entity contracting with a regional center or new commercial enterprise to receive capital investment under the regional center program from alien investors or the new commercial enterprise as financing for maintaining, improving, or constructing a public works project.
    Unused visas in these categories are held for use in their respective category for 1 more fiscal year before being released to the general EB-5 visa pool.

Source: USCIS

EB-5 News Uncategorized

Proposed EB-5 Legislation

To keep the government running, the Congress has just approved another stopgap continuing resolution, which means that the EB-5 program will remain for most of 2016. However, it has been widely anticipated that legislation in some form will be enacted shortly to renew and reform the Program.

The current EB-5 program, which offers a family-sized set of green cards to foreigners who directly invest $1 million, or invest $500,000 into targeted employment areas (“TEAs”), has been very popular among Chinese investors in recent years.

Under the proposed legislation, once passed, the minimum investment amount in rural and high-unemployment areas would be increased from $500,000 to $800,000. For the investment projects that already had I-924 and I-526 approvals, they will enjoy a 60-day grace period. Thus, if investors submit the application within 30 days of the effective date of the new legislation, the investment amount is $600,000; between the 31st day and the 60th day, the amount is $700,000; and starting the 61st day, the amount will be adjusted to $800,000. Investment to non-TEAs will be adjusted to $1.2 million.

Also, the new legislation will redefine what constitutes the TEA. TEA designation will be tightened up. Further, the new legislation will allot a certain number of visas to different investment categories, such as 2,000 visas for projects in rural areas and 2,000 visas for people who invest $1 million, while the total number of visas remains the same.

Finally the new legislation will require more disclosure regarding how the capital is being utilized, and investors’ source of funds. The current EB-5 program has been under fire when 35 Chinese investors who lost nearly $20 million in South Dakota’s EB-5 program sued the state for fraud.

Although investors can be relieved for now, changes are likely to come. Our firm will monitor closely of any development. Let’s sit tight and wait for what is coming. Please contact us for any EB5 questions.

EB-5 Uncategorized

EB5 Regional Center Questions and Answers

Question: What is the difference between Regional Center and a direct investment? What are the pros and cons of each? Can the EB-5 investor be limited in the legal exposure/management of the project, such as is often the case defined by being a limited partner in an indirect EB-5 investment through a Regional Center?

Attorney Lei Jiang: The main difference is that a regional center can utilize indirect job creation while a direct investment cannot.  Moreover, direct investment normally requires more involvement from investors.  Regional center projects, on the other hand, have a team of professionals. So investors are all passive investors.

Question: Why does I-924 takes from targeted 4 month to 9 month? What are the reasons for this delay?

Attorney Lei Jiang: I-924 normally takes 9 month or longer. USCIS wants to be careful but lack of officers. So it is backlogged.

Question: Do I submit my project directly to a Regional Center? I am a real estate developer in Indianapolis. I have a project in Chicago which will generate 50 new jobs and the project total cost is $10 million.

Attorney Lei Jiang: You should contact Chicago regional centers to see if they are interested in your project.

Question: Do you need to have an EB-5 Project in order to start your own Regional Center? I want to know the requirements to start a regional center myself, and if I need to have a project ready before applying to become a Regional Center?

Attorney Lei Jiang: No. You do not need an actual project for regional center application, but as part of the application, you need to submit a hypothetical/exemplar project plan.

Question: I have a project but I don’t want to wait a year or so to get a regional center designation. Can I purchase an existing one? Would I need an immigration lawyer to help me in the transaction if it is possible?

Attorney Lei Jiang: Yes, you can if a regional center agrees to sell.  Alternatively you can “rent” one. You do not need immigration attorney for this transaction but it is good to have one. You need to understand immigration issues.

Question: Does your law firm offer the service of establishing a regional center? And approximately how much would it cost for this service? Thanks.

Attorney Lei Jiang: Yes we do.  It normally runs around $80,000 to 120,000. There are many other law firms offering such service.

Question: What is the benefit of investing in an EB-5 Regional Center as opposed to going with a direct investment in an EB-5 project?

Attorney Lei Jiang: You can utilize an economic model for job calculation. 10 required jobs for every investor (normally with  $500,000 investment) is difficult to achieve for many business ventures.

©Lei Jiang Law Firm 2014.

EB-5 Uncategorized

EB5 Regional Center Questions and Answers

Question: I am planning to invest in my own project but it might not create 10 direct jobs in 2 years. There is a Regional center in the same area with a similar project. How could I work with the regional center and create a structure to leverage their ability to include indirect jobs?

Attorney Lei Jiang: You need to talk to them. One benefit of using regional center is that you can count indirect jobs.

Question: Why do Regional Centers use mezzanine financing? Isn’t mezzanine financing risky?

Attorney Lei Jiang: This kind financing is commonly used in real estate. Since most regional centers have real estate projects. You should not be surprised by this type of financing.

Question: What would be an applicant’s position if EB5 pilot program is not renewed (Sept 2015) after approval of his I-526? Would all rights to obtain residence be lost? Could an investor sell his investment immediately to reclaim funds?

Attorney Lei Jiang: It’s unlike that the program will not be renewed.  Whether the investor can sell his investment or not depends on the subscription agreement and other legal documents that he has signed. Investors should always read these legal documents very carefully and/or seek professional help.

Question: What is the process for filing a complaint against a Regional Center for fraud? I am a project sponsor who paid a non-refundable deposit to a firm representing itself as an established Regional Center. The Regional Center I wish to file a complaint against is the parent of the firm we paid, but wasn’t an approved center at the time of payment. Also, how do I access the date on which a Center was approved? The USCIS website does not list that information, and my email inquiries to them have been rejected.

Attorney Lei Jiang: All approved centers are listed on USCIS website. So if a regional center has not been approved, it will not be on the USCIS list. Normally you can file a lawsuit (complaint) in a common pleas court or a federal district court which has the jurisdiction of this company. You need a lawyer for that.

Question: My main goal is the preservation of my capital. What are the chances that the regional center does not return the principal? Do regional centers return the full principal I’ve invested with them at the end of the 5 or 6 year period? How often do they fail and how can I find the regional center which has no failure record.

Attorney Lei Jiang: Do your research and talk to EB5 attorneys (they know the regional centers)! It’s just like other investments (stocks, bonds, etc.).

Question: How do you go about using an EB5 Regional Center to fund a project, without becoming designated as a regional center yourself? I have a business in Colorado and have researched the EB5 program. Once I find a regional center whose designation I may use, who does the reporting to USCIS and do I have to do a business plan and economic impact study to work through the regional center. What does the Regional Center have to provide the USCIS with if a third part project is using its designation?

Attorney Lei Jiang: You need to talk to the regional center to see whether you can utilize it and how to do it. Business plan and economic report are needed for immigration petitions.

©Lei Jiang Law Firm 2014.

EB-5 Uncategorized

EB5 Regional Center Questions and Answers

Question: I want to invest with EB-5 regional center so that investment is only $500,00. But I do not understand what a regional center is. Is a regional center a global company or a U.S. company? Does each regional center correspond to a specific project center or institution?

Attorney Lei Jiang: a regional center is a U.S. business which invests funds in projects in U.S. It is approved by USCIS so it can attract foreign investors. It is not an institution or governmental entity.

Question: I have a green energy project I’ve been trying to get up and running through EB-5. But it takes so long to get approved as a Regional Center, I don’t have the time. Can I buy a Regional Center? In the long run, is it better to buy a Regional Center or simply work in junction with one?

Attorney Lei Jiang: Yes, you can buy or work with a regional center. It’s difficult to say which approach is better. Each has its pros and cons. Initial investment for setting up a regional center is big, but if it’s successful, in the long run, you can recoup all expenses plus profits.

Question: Assuming Company headquartered in the US and majority shares held therein, might a Regional Center have the right to invest in projects outside US jurisdiction?

Attorney Lei Jiang: It will be difficult. How do you generate 10 U.S. fulltime jobs for each investor ? And each investor will have to invest $1 million since it is not even in U.S. Question: Does USCIS provide any foreign investor leads to Regional Centers, i.e. when foreigners make inquiries directly with USCIS, how does USCIS handle those inquiries; does it refer prospective investors to Regional Centers? If no, what is the disposition of such inquiries? If yes, what criteria is used to determine which Regional Center such inquiries will be referred to? Please provide with a list of Features and Benefits (as well as negatives, if possible) of becoming a USCIS Regional Center. I operate a boutique hedge fund which conducts most of its business cross-border and have worked nearly exclusively on this basis for > 20 years.

Attorney Lei Jiang: USCIS will not make any referral. The list of approved regional centers is on USCIS website. That is pretty much all the help you will get from USCIS. The main benefit of regional center over direct investment is that RC can count indirect jobs.

Question: Can a regional center, or those working on its behalf, charge a commission (i.e. 10%) on top of the $500,000 investment made by the person seeking the EB-5 visa?

Attorney Lei Jiang: Commission is normally paid to agents/broker. 10% commission is on the high end. Regional center will charge a management fee though.

Question: If our business plan is to build and operate a hotel, what specifically can we count as an indirect job if we become a Regional Center? Do construction jobs count as direct or indirect? If we hire consultants, do those jobs count for the total of 10? Does it matter how many of the jobs we create are direct? ID:496 Attorney Lei Jiang: Direct jobs come from counting W2. Indirect jobs mean that even a regional center does not hire a required number of employees, based on an economic model, it will create certain number of jobs. When you apply for a regional center, you will have to hire an economist. Economic report will tell you exactly how many indirect job your project will create.

©Lei Jiang Law Firm 2014.

EB-5 Uncategorized

EB5 Regional Center Questions and Answers

Question: What is difference between direct investments and regional center investments? Does the processing time differ? I want to choose the best way to do it.

Attorney Lei Jiang: For individual investor, there should not be much difference in the processing time. Direct investment relies on direct job creation while regional centers can rely on direct and indirect job creation. Therefore in this regard, investing in a regional center project is normally safer than investing in a U.S. company directly.

Question: I plan taking Regional Center 500K Investment Route for Green Card. USCIS site says current processing time is 12 months. Currently I’m holding B1/B2 Visa & have been visiting US regularly for the past 10+ Years. One of the attorneys has assured me that after identifying & subscribing to EB5 Program, a B1/B2 Visa holder can enter US and while petition is pending. He (Attorney) can get the permission from authorities to allow me to come back legally & conduct business. But I’ve heard conflicting opinions. Could you help me on this?

Attorney Lei Jiang: You might encounter a problem with your B1 visa because B1 does not allow immigration intent. By filing an EB5 immigration petition, you basically tell USCIS you intend to immigrate to U.S. Consulate has enormous power to reject your B1 visa and its decision is not subject to any review. No attorney can get you permission in this situation.

©Lei Jiang Law Firm 2014.

EB-5 Uncategorized

EB5 Regional Center Questions and Answers

Question: I am from India and want to apply for a EB5 through a regional center. The funds  will be a gift for me from someone in US in USD . I want to know if 1) Can the gift from my relative be directly to the Escrow account. 2) If not and the funds need to be transferred to an account of mine then has any one had any problems in opening a bank account for an Indian in US / Canada . I don’t want to get a gift in Indian rupees as it will really complicate the transaction. Do we need to travel to that location to open a bank account?

Attorney Lei Jiang: You can have your relatives send you money to your U.S. bank account. You need to properly document the gift.

Question: We are currently looking at leasing a center while waiting for I-924 approval. We have heard that leasing a center can add additional delays to I-526 applications. Knowing that the first I-526 will have the business plan and economic analysis whether it’s through our own center or one we lease, are there any extra delays to leasing a center as opposed to using our center once approved? It seems like the I-526 will go through the same process, whether is through a center we lease or through our own, so if we lease a center then we could potentially submit our first I-526 sooner than waiting for our center to be approved. It will be a year this December that our I-924 has been pending.

Attorney Lei Jiang: There will be no additional delays. But if you decide to lease a regional center, then your project will be under this leased RC.  This will make your own RC (if approved later) wasted.

©Lei Jiang Law Firm 2014.

EB-5 Uncategorized

EB5 Regional Center Questions and Answers

Question: Is it possible that my regional center application may be fast-tracked by the USCIS in exchange for an elevated processing fee?

Attorney Lei Jiang: Not at this time, unfortunately.

Question: I have heard that sales or transfers of Regional Centers have been rejected or have gotten RFEs. I guess that the USCIS may be schizophrenic in their decision making. Has anyone done a deal like this recently? If so, would your firm be open to doing a sale or transfer?

Attorney Lei Jiang : USCIS will want to see that the buyer has the credibility in running a successfully RC. RFEs will likely to be issued.  To structure the sale, some ways are better than others. Please feel free to contact us.

Question: Hello. I currently have F1 visa and am studying at a university here in USA. I am seeking EB-5 through regional center projects. I do not have money myself and my parents will gift to me the whole amount. I am from China. But the question is I don’t know how they gonna prove lawful source of funds. My parents have a small factory and just doing a little business. Most of the money are saved from the profits of the business. They have stock as well, but the deposit money are coming from the business, too, but they have never filed taxes. Does this mean my parents money could be unlawful for EB5? I also find somebody saying about get a loan from the property could be a source, too. My parents have some property that they purchased 10 years ago, but they are saying it was too long ago and may not be able to. I hope I’ve asked my question clearly enough. Thank you.

Attorney Lei Jiang: There are other legitimate ways to produce required documents.  Also the money can come from bank loan using real properties as collateral.

©Lei Jiang Law Firm 2014.

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