EB-5 reform targets investment thresholds, designation of low-employment areas

U.S. Citizenship and Immigration Services (USCIS) has published a final rule that makes major changes to the EB-5 Immigrant Investor Visa Program. The changes will take effect Nov. 21 and include:

• Increasing investment thresholds. The standard minimum investment will increase from $1 million to $1.8 million. The minimum investment in a targeted employment area (TEA) will increase from $500,000 to $900,000. The thresholds will increase automatically every five years to keep up with inflation.
• Reforming the TEA designation process. The rule removes state governments from the TEA designation process, giving the federal government exclusive authority to identify low-employment areas. USCIS said this change will help eliminate “gerrymandering” in the TEA designation process, i.e., drawing low-employment areas so that they include prosperous projects that do not need the lower investment thresholds.
• Ensuring that EB-5 petitioners can keep their priority date. The rule ensures, with some exceptions, that immigrant investors who have a previously approved EB-5 petition will be able to keep their priority date if they are required to submit a new EB-5 petition. This will be particularly helpful to investors from countries with significant backlogs.

Additional information: The EB-5 visa program was created in 1990 and allows foreign nationals to apply for conditional permanent residence if they make the required investment in a business or commercial project and create or retain at least 10 full-time jobs. USCIS Acting Director Ken Cuccinelli said in a statement that the increased investment thresholds will be put in place to “account for inflation over the past three decades” and that the changes to the TEA designation process will help “ensure that the reduced investment amount is reserved for rural and high-unemployment areas most in need.” The final rule was published in the Federal Register on July 24.

This alert has been provided by the BAL U.S. Practice group. For additional information, please contact berryapplemanleiden@bal.com.

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