Written by: Taher Kameli, Esq.
The EB-5 program has been a popular vehicle for immigrant investors to obtain green cards, and status as a permanent lawful resident, in the United States. Under the EB-5 program, by investing $500,000 in a project located in a “targeted employment area” (generally rural areas and areas with high levels of unemployment) (“TEA”) that creates 10 full-time jobs, the immigrant investor generally can obtain a green card. Persons interested in the EB-5 program should note that new regulations are near publication that may significantly modify the requirements of the EB-5 program.
On June 27, it was announced that the Office of Management and Budget (“OMB”) had completed its review of the “EB-5 Immigrant Investor Program Modernization” regulations (the “EB-5 Regulations”). This OMB completion of review is generally the final step in the rulemaking process before final regulations are published in the Federal Register.
No one can be certain what will be included in the final EB-5 Regulations. The EB-5 Regulations were first announced as a proposed rule in January, 2017. However, based on public comments and changes made by U.S. Citizenship and Immigration Services (“USCIS”) and OMB, the final EB-5 Regulations possibly may differ significantly from these “January, 2017” proposed EB-5 Regulations. One issue that the EB-5 Regulations are expected to address is investment amount. While no one knows for certain what the final EB-5 Regulations will provide, the “January, 2017” proposed EB-5 Regulations would have increased the investment amount for a TEA project to $1,350,000 and the investment amount for a “non-TEA” project (currently set at $1,000,000) to $1,800,000.
Another issue that the EB-5 Regulations are expected to address is the TEA designation process. Again, while no one knows for certain what the final EB-5 Regulations will provide, the “January, 2017” proposed EB-5 Regulations would have eliminated the ability of a state to designate certain geographic and political subdivisions as TEA’s; instead, the Department of Homeland Security would make such designations directly.
Another uncertain issue is when will the final EB-5 Regulations be effective. While the final EB-5 Regulations are expected to apply prospectively (and not retroactively), with probably a “deferred” effective date of 30 days after publication, again, no one knows for certain yet what will be the specific effective date. One thing is for certain – especially if the final EB-5 Regulations are seen as creating more stringent requirements for the EB-5 program, there will be a “mad rush” to complete EB-5 projects and make EB-5 investments before the effective date to be “grandfathered” and take advantage of the old EB-5 rules.
It is also possible that Congress or the courts may get involved to delay the effective date of the final EB-5 Regulations.
When the final EB-5 Regulations are published in the Federal Register, Kameli Law will provide a detailed analysis of the final rules. TheKameli Law has successfully obtained green cards for many immigrant investors under the EB-5 program. If you have any questions concerning the EB-5 program, please contact Kameli Law, at firstname.lastname@example.org or 312-233-1000, for assistance.