Investors from China and other countries who have chosen to pour capital into business formation in the United States have been facing whiplash and frustrating roadblocks recently. New laws and regulations have stymied the flow of commerce through quotas, increased minimum investment requirements and a tremendous backflow of visa applications for investors and their families.
The EB-5 Immigration Investor Program that began in 1990 was designed to enhance the U.S. economy by welcoming foreign investment to boost job growth and economic expansion. Under this program, an investor was required to show that his funds had created or saved ten new jobs through an EB-5 investment.
While the EB-5 program has survived the last few years, the global health crisis has created huge complications for foreign investors due to travel restrictions, reduced flight schedules and a tightening of visa services. It is more important than ever to have legal advice from a multinational firm based in California that helps foreign investors to be prepared for changes in U.S. law.
New approach to visa availability
Traditionally, the United States Citizenship and Immigration Services (USCIS) has processed the I-626 petitions for EB-5 applicants on a first come first in, first out basis regardless of country of origin. However, this changed with the USCIS’s new visa availability approach, which prioritized I-526 petitions coming from countries of origin that had readily available visas. For Chinese investors, this has caused a huge backlog, since so much foreign investment comes from China.
The Modernization Rule of 2019 also dramatically increased the EB-5 investment requirements to a minimum of $1.8 million ($900,000 in economically challenged areas) while also requiring that this capital come from a single investor. It also changed the rules regarding a targeted employment area (TEA), which resulted in the termination of many EB-5 regional centers.
Alternatives to the EB-5
Fortunately, there are other avenues for obtaining a green card in the United States. Another category of visas that allows companies to bring high-level executives or managers in from abroad is a sub-category of Employment-Based Immigration, the First Preference EB-1(C).
The requirements for this status include:
- Recent employment outside the United States in the three years preceding petition
- S. petitioner must have a business relationship with foreign business for at least one year, including a qualifying relationship with this entity
- S. petitioner must have intent to hire applicant in a managing or executive function
There are likely to be more changes to existing immigration law soon, so it is important for foreign investors to stay up to date in the coming months.