A controversial set of rules issued in 2019 regarding the EB-5 visa was struck down on June 23 by U.S. Magistrate Judge Jacqueline Scott Corley, leaving new implications for potential EB-5 investors.[1] Known as the EB-5 Immigrant Investor Program Modernization, the 2019 changes provided updates to laws governing the visa. The most significant of these changes was the increase of required capital investment from $500,000 to $900,000.[2]
Following the change, many in the U.S. expressed concerns about the investment requirement increase, arguing that it would prohibit many middle-class investors (the target group of the EB-5) from participating in the program. In the case that led to the rules being overturned, Behring Regional Center v. Wolf, the plaintiff argued that the increase would have a considerable adverse economic impact.[3]
Due to the fact that the acting Secretary of Homeland Security at the time, Kevin McAleenan, had been improperly appointed, the judge determined that the rules were improperly issued. Consequently, the $900,000 capital investment requirement has been reduced to the previous $500,000.[4]
But what does this mean for potential EB-5 investors?
EB-5 consultancy firm The American Legal Center predicts that the reduction may not last long, anticipating that the investment requirement will again increase due to inflation or future legislation. And according to Entrepreneur, the reduction may cause a large increase in applications, leading to both a backlog of EB-5 petitions and long wait times.[5]
However, there is some good news: the United States Citizenship and Immigration Services (USCIS) almost doubled the quota for EB-5 visas for the 2021 financial year, making more of these visas available for applicants.[6] The takeaway is clear: those considering applying for an EB-5 visa should act soon, taking advantage of the required capital investment reduction and the increased quota.
If you are applying for an EB-5 and need a solid and credible business plan, make sure to contact our office today.
[1] The Wall Street Journal “Trump Rule Tightening EB-5 Visa Program Struck Down by Federal Judge.” | June 23, 2021 | Michelle Hackman
[2] Federal Register “EB-5 Immigrant Investor Program Modernization.” | July 24, 2019 | Homeland Security Department
[3] Entrepreneur “Federal Court Judge Leaning Towards Changing $900,000 EB-5 Rule.” | June 21, 2021 | Shai Zamanian
[4] The Wall Street Journal “Trump Rule Tightening EB-5 Visa Program Struck Down by Federal Judge.” | June 23, 2021 | Michelle Hackman
[5] Entrepreneur “Federal Court Judge Leaning Towards Changing $900,000 EB-5 Rule.” | June 21, 2021 | Shai Zamanian
[6] Entrepreneur “Federal Court Judge Leaning Towards Changing $900,000 EB-5 Rule.” | June 21, 2021 | Shai Zamanian
The information provided in this blog is intended solely for informational purposes. While we strive to offer accurate and up-to-date content, it should not be considered legal advice. Immigration laws and regulations are subject to change, and individual circumstances can vary widely. For personalized guidance and legal advice regarding your specific immigration situation, we strongly recommend consulting with a qualified immigration attorney who can provide you with tailored assistance and ensure compliance with current laws and regulations.
Visa Business Plans is led by Marco Scanu, a certified coach from the University of Miami with a globally-based practice coaching Fortune 1000 company executives, entrepreneurs, as well as professionals in four different continents. Mr. Scanu advises clients on turnaround strategies and crisis management.
Mr. Scanu received a bachelor’s degree in Business Administration (Cum Laude) from the University of Florida and an MBA in Management from Bocconi University in Milan, Italy. Mr. Scanu was also a Visiting Scholar at Michigan State University under the prestigious H. Humphrey Fellowship (Fulbright program) with a focus on Entrepreneurship, Venture Capital, and high-growth enterprises.
At present, Mr. Scanu is the managing partner and CEO at Visa Business Plans, a Miami-based boutique consulting firm providing attorneys and investors with business planning services in the areas of U.S. and Canadian immigration, SBA loans, and others.
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