On July 24, 2019, the Department of Homeland Security published the final “EB-5 Immigrant Investment Program Modernization” rule, making sweeping changes to the investor visa program starting on November 21, 2019. Some of the changes are good news for immigrant investors, including the new priority date retention policy. Other updates such as the increased minimum investment levels and more restrictive Targeted Employment Area (TEA) designation process will pose some challenges to new investors hoping to earn a green card.
Here are the major changes the rule makes to the EB-5 investor visa program:
Priority dates can be retained for certain EB-5 investors.
- A petitioner with multiple approved immigrant petitions as an investor can utilize the earliest qualifying priority date.
- This situation might occur when an investor must file a new petition due to a regional center termination or a material change in the business conditions underlying the qualifying investment.
- Once the conditional green card is issued, the priority date cannot be retained for another petition. You must meet the criteria for removing the conditions to receive your regular green card.
- The priority date retention is generally available except in cases of fraud or misrepresentation.
Minimum investments have increased.
- Standard EB-5 investments will increase from $1 million to $1.8 million.
- Targeted Employment Area (TEA) investments will increase from $500,000 to $900,000.
- Minimum investment amounts will now automatically increase for inflation every five years.
The TEA designation process has been shifted to DHS.
- States will no longer have the ability to designate areas as high-unemployment areas.
- DHS will now review all requests for TEA designations.
- Only cities and towns with populations of 20,000 or more outside of MSAs may qualify as a specific and separate TEA based on high unemployment.
- DHS is finalizing a census tract process for making special TEA designations.
- DHS will amend its regulations so that a TEA may consist of a census tract or contiguous census tracts in which the new commercial enterprise is principally doing business if the new commercial enterprise is located in more than one census tract; and the weighted average of the unemployment rate for the tract or tracts is at least 150 percent of the national average.
- DHS will also amend its regulations so that a TEA may consist of an area comprising the census tract(s) in which the new commercial enterprise is principally doing business, including any and all adjacent tracts, if the weighted average of the unemployment rate for all included tracts is at least 150 percent of the national average.
Family members must file their own petitions to remove conditions (if not included in the petition filed by the principal investor).
- The rule clarifies that any derivatives must file separate petitions if they are not included on the principal investor’s petition to remove conditions.
- There will be more flexibility in interview locations related to the Form I-829.
I’ve already invested and filed Form I-526. Does the new rule affect me?
As an existing investor you will benefit from the priority date retention. There are a variety of factors that could cause the basis for your petition to no longer qualify for the removal of conditions on the green card. If you chose to file an additional I-526 based on a new qualifying investment, you would need to meet the new minimum investment levels, but could retain the priority date of your first petition. Please note that once a conditional green card is issued, the priority date cannot be retained for another petition.
What do new investors need to know?
New investors will still be subject to the underlying requirements of the EB-5 visa, including making a necessary investment in a commercial enterprise in the United States and creating 10 full-time jobs for qualified U.S. workers. If you are planning to invest and file prior to the November 21, 2019 effective date, you can still utilize the lesser investment amounts of $500,000 (for a TEA investment) or $1 million (standard EB-5 investment). We recommend starting that process now if you plan to file before the rule goes into effect, as it could take quite some time to gather the appropriate documentation and transfer the funds to a project.
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