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EB-5 Insights

Where Government Policies and Business Realities Converge

By Greenberg Traurig on Posted in China, Department of State, EB-5, EB-5 Business Plan, EB-5 Immigrant Investor Program, EB-5 Investment, I-526, Immigrant Investor, Immigrant Visa, Immigration, Immigration Law, USCIS, Vietnamese

At a recent EB-5 industry forum, Mr. Charles Oppenheim, Chief of the Department of State (DOS) Immigrant Visa Control & Reporting Division, provided key insights on what the latest data suggests regarding the future availability of visas in the EB-5 category.

Top EB-5 Visa Users in FY2018: China, Vietnam, and India

In terms of EB-5 number use by country, although Mainland China remains the largest user of EB-5 visa numbers, the latest data indicates that the cumulative number usage by the rest of the world has surpassed total numbers used by China for the first time in recent history, with China receiving about 48 percent of the total EB-5 annual visa allocation in Fiscal Year (FY) 2018.

The next largest users are Vietnam, which reached its annual per-country cap of 7.1 percent for the first time in FY2018, and India, which showed significant growth, increasing number usage from 1.7 percent in FY2017 to 6.1 percent in FY2018.

Future Projections for Visa Bulletin Final Action Dates in the Near-Term

Based on these demand trends, Mr. Oppenheim predicts that by July 2019, but possibly earlier, India may retrogress. Mr. Oppenheim anticipates very slow movement for Mainland China, while Vietnam is likely to advance to September 2016 this fiscal year, but will likely retrogress in May or June of 2019 and begin to track with China.

Long-Term Projections for Total EB-5 Visa Wait Time

Importantly, the DOS has provided key estimates for the potential immigrant visa wait time by country. These estimates represent the number of years an investor can expect to wait from the time of filing the I-526 to the time an EB-5 visa becomes available. Once an EB-5 visa is available, the investor is eligible to proceed with the final step in the permanent residence process through Consular Processing, or, if the investor is in the United States, Adjustment of Status (AOS).

Potential Wait Time if I-526 Filed 10/30/2018
Chargeability Area Estimated Visa Wait Time
China-mainland born 14 years
Vietnam 7.2 years
India 5.7 years
South Korea 2.2 years*
Taiwan 1.7 years*
Brazil 1.5 years*

*As the current USCIS processing time for an I-526 is roughly two (2) years, there is no effective wait time between I-526 approval and visa availability.

Among other considerations, these projections may impact a child’s protection under the Child Status Protection Act (CSPA), and thus their ongoing eligibility to obtain U.S. permanent residence as a derivative of the principal investor. The law limits eligibility to unmarried children under the age of 21 (and those 21 and older who qualify for CSPA protection), so a lengthy wait time in excess of the I-526 processing time may cause a child to “age out” before an EB-5 visa becomes available. Therefore, visa wait time estimates are particularly important for investors with teenage and young adult children.

Contact your Greenberg Traurig attorney for more information and for planning your path to permanent residency in the United States.

By Shaoul Aslan‡ on Posted in Department of State, EB-3, EB-5, Immigration, Visa Bulletin

The Department of State (DOS) December 2018 Visa Bulletin shows some movement in employment-based categories. The EB-1 category will advance three months in all countries, with China and India advancing to Sept. 1, 2016, and all other countries will move forward to July 21, 2016. The EB-2 category remained current for all countries except China, advancing to July 1, 2015, and India, advancing to April 1, 2009. Although most countries will remain current in the EB-3 category, China will advance by one week to June 8, 2015, India will advance by two months to March 1, 2009, and the Philippines will advance by one week to June 15, 2017. As mentioned in our previous blog post, the EB-3 India final action date moved very rapidly over the past year, advancing almost a year and a half. Current demand projections make it likely that EB-3 India could surpass EB-2 India at some point this fiscal year. As noted above, India will advance two months in the EB-3 category in December. GT will be closely monitoring these advancements as they unfold.

Referring to the Final Action Dates, following are updates from the September Visa Bulletin:

EB-1: Mainland China and India will advance, with a cutoff date of Sept. 1, 2016, while El Salvador/Guatemala/Honduras, Mexico, Philippines, and Vietnam all moved forward to July 1, 2017.

EB-2: For the cutoff date for worldwide chargeability, El Salvador, Mexico, Philippines, and Vietnam are all now current. Mainland China will move to July 1, 2015; India had slight movement to April 1, 2009.

EB-3: In the EB-3 category, for the worldwide chargeability, El Salvador/Guatemala/Honduras cutoff is Feb. 22, 2016, Mexico will move to Jan. 1, 2017, and all other countries will remain current.

For those in the EB-5 category, the priority date remains current for all applicants other than those born in Mainland China and Vietnam, where the cutoff for China will advance slightly to Aug. 22, 2014, and for Vietnam it will advance significantly to May 1, 2016.

For those seeking to adjust status, The United States Citizenship and Immigration Service (USCIS) website indicates that the department’s Dates for Filing chart must be used for filing Form I-485. This is generally not the case, as USCIS usually requires that applicants use the “Application for Final Action Dates,” which typically reflects earlier cutoff dates than that “Dates for Filing” chart.

Referring to the Final Action Dates, following are updates for the December Visa Bulletin:

Final Action Dates for Employment-Based Preference Cases

Dates for Filing of Employment-Based Visa Applications

By Greenberg Traurig on Posted in EB-5, EB-5 Business Plan, EB-5 Immigrant Investor Program, EB-5 Investment, EB-5 Legislation, EB-5 Program, Uncategorized

On Oct. 30, 2018, USCIS issued an update to the USCIS Policy Manual clarifying the types of agreements that constitute an impermissible debt arrangement. USCIS revised Part G, Volume 6, Chapter 2, Section A.2. to reflect various scenarios where an operating agreement of a new commercial enterprise will or will not constitute an impermissible redemption agreement.

As defined by USCIS, an impermissible debt arrangement is an arrangement whereby an EB-5 investor has a contractual right to repayment of the invested capital. The Code of Federal Regulations specifies that a contribution of capital in exchange for a note, bond, convertible debt, obligation, or any other debt arrangement between the EB-5 investor and the new commercial enterprise does not constitute a contribution of capital for the purposes of the EB-5 Program.[1] This principle is also supported by the precedential decision Matter of Izummi, which found that an arrangement where an EB-5 investor provides funds in exchange for an unconditional, contractual promise that such funds will be repaid at a fixed maturity date constitutes an impermissible debt arrangement.[2]

In Matter of Izummi, the petitioner had a sell option that enabled him to require his investment be repaid at a certain price. Between Matter of Izummi and this update to the USCIS Policy Manual, USCIS has taken an expansive view of whether the terms of an EB-5 investment constitutes an impermissible debt arrangement.[3] USCIS previously believed that sell options and purchase options constituted impermissible debt arrangements, oftentimes with the following language contained with a Notice of Intent to Deny: “’For the alien’s money truly to be at risk, the alien cannot enter into a partnership knowing that he already has a willing buyer in a certain number of years, nor can he be assured that he will receive a certain price.’ Matter of Izummi, 22 I. & N. Dec. at 186.”

This interpretation has been subject to multiple federal court litigations. Most recently, in Chang v. USCIS, the U.S. District Court for the District of Columbia found USCIS’ expansive view of the holding of Matter of Izummi and 8 C.F.R. 204.6(e) to be arbitrary and capricious.[4] In Chang, the general partner of the new commercial enterprise possessed a call option to cause an EB-5 investor’s withdrawal of the new commercial enterprise by paying the EB-5 investor an amount equal or greater than the investment either before the investment was used to provide a loan or after the EB-5 investor became a lawful permanent resident. USCIS denied the I-526 Petition in Chang v. USCIS, claiming the call option constituted an impermissible debt arrangement. The court found that USCIS had acted in a manner that conflicted with the plain language of its regulations, was not compelled by statutory or regulatory purpose, unreasonably stretched the rationale of Matter of Izummi, and ran counter to the evidence in the record. Chang v. USCIS was the second federal court to make this holding.[5]

USCIS has finally updated its Policy Manual to conform to these federal court decisions. The USCIS Policy Manual now states that USCIS generally does not consider options exercisable by the new commercial enterprise to be impermissible debt arrangements.[6] Accordingly, operating agreements or limited partnership agreements of a new commercial enterprise may contain call options exercisable by the manager or general partner to pay an investor a set amount at a fixed date.

[1] 8 C.F.R. 204.6(e).

[2] Matter of Izummi, 22 I&N Dec. 183 (Assoc. Comm’r 1998)

[3] Matter of Izummi, 22 I&N Dec. 183-185 (Assoc. Comm’r 1998)

[4] Chang v. USCIS, 289 F.Supp.3d 177 (D.D.C. Feb. 7, 2018).

[5] Doe v. USCIS, 239 F.Supp.3d 297, (D.D.C. Mar. 10, 2017).

[6] USCIS Policy Manual, Part G, Vol. 6, Chpt. 2, Sec. A.2.

By Patty Elmas* on Posted in China, EB-3, EB-5, EB-5 Program, USCIS, Visa, Visa Bulletin

The Department of State (DOS) November 2018 Visa Bulletin shows movement in employment-based categories. The EB-1 category remained retrogressed for November 2018. Although it is likely that there will be some forward movement in December 2018 for EB-1 India, it will probably NOT return to “current” this calendar year. The EB-2 India category will likely move forward in December, but it will probably be only a week or so. The EB-3 category for India on the other hand may start seeing more significant advancement in December (weeks or possibly months). To provide context, the EB-3 India final action date moved very rapidly over the past year, advancing almost a year and a half. Current demand projections make it likely that EB-3 India could surpass EB-2 India at some point this fiscal year.  GT will be closely monitoring these advancements as they unfold.

Referring to the Final Action Dates, following are updates from the September Visa Bulletin:

EB-1: Mainland China and India had significant movement since September 2018, with a cutoff date of June 1, 2016, while El Salvador/Guatemala/Honduras, Mexico, Philippines, and Vietnam all moved forward to April 1, 2017.

EB-2: The cutoff date for worldwide chargeability, El Salvador, Mexico, Philippines, Vietnam are all now current. Mainland China moved to May 15, 2015; India to March 26, 2009.

EB-3: In the EB-3 category, the worldwide chargeability, El Salvador/Guatemala/Honduras, Mexico and Vietnam are all current. The Mainland China cutoff is June 1, 2015; India is January 1, 2009; and Philippines is June 8, 2017.

For those in the EB-5 category, the priority date remains current for all applicants other than those born in Mainland China and Vietnam, where the cutoff for China advanced to Aug. 15, 2014 and for Vietnam to Feb. 1, 2016.

For those seeking to adjust status, The United States Citizenship and Immigration Service (USCIS) website indicates that the department’s Dates for Filing chart must be used for filing Form I-485. This is generally not the case, as USCIS usually requires that applicants use the “Application for Final Action Dates,” which typically reflects earlier cutoff dates than that “Dates for Filing” chart.

Referring to the Final Action Dates, following are updates for the June Visa Bulletin:

Final Action Dates for Employment-Based Preference Cases

Dates for Filing of Employment-Based Visa Applications

By Anita E.J. Ninan on Posted in Department of Homeland Security, Immigrant Visa, Immigration, Immigration Law, Proposed Rule, USCIS, Visa

USCIS has proposed rules that could deny entry to non-immigrants seeking admission to the United States and adjustment of status to permanent residence to immigrants if they rely on public benefits for food, housing or medical care, and other forms of public assistance. The proposed rule – “Inadmissibility on Public Charge Grounds” – is published in the Federal Register. The public may comment on the proposed rule during the 60-day comment period ending on Dec. 10, 2018. USCIS will review comments to the proposed rule and then revise and issue a final public charge rule that will include an effective date. In the interim, and until a final rule is in effect, USCIS will continue to apply the current public charge policy.

Pursuant to Section 212(a)(4) of the Immigration and Nationality Act (INA), an individual seeking admission to the United States or seeking to adjust status to permanent resident (obtaining a green card) is inadmissible if the individual “at the time of application for admission or adjustment of status, is likely at any time to become a public charge.”

Under 8 U.S.C. § 1601 (PDF)(1), “Self-sufficiency has been a basic principle of United States immigration law since this country’s earliest immigration statutes.”

Further under 8 U.S.C. § 1601 (PDF)(2)(A), “It continues to be the immigration policy of the United States that aliens within the Nation’s borders not depend on public resources to meet their needs, but rather rely on their own capabilities and the resources of their families, their sponsors, and private organizations.”

While self-sufficiency has been the guiding principle of U.S. immigration law, as indicated in the above federal regulations, “public charge” has not been defined in statute or regulations. According to USCIS, there has been insufficient guidance on how to determine if an alien who is applying for a visa, admission, or adjustment of status is likely at any time to become a public charge. In determining inadmissibility USCIS has used the definition of “public charge” as an individual who is likely to become “primarily dependent on the government for subsistence, as demonstrated by either the receipt of public cash assistance for income maintenance, or institutionalization for long-term care at government expense.” (See, “Field Guidance on Deportability and Inadmissibility on Public Charge Grounds,” 64 FR 28689 (May 26, 1999). In determining whether an alien meets this definition for public charge inadmissibility, USCIS considers several factors, including age, health, family status, assets, resources, financial status, education, and skills. No single factor will determine whether an individual is a public charge.

The proposed rule will apply to foreign nationals seeking admission to the United States on non-immigrant and immigrant visas, as well as those non-immigrants who have availed themselves of public benefits within the United States and are seeking to seeking to either extend their stay or change their status. Under the proposed rule, USCIS would only consider the direct receipt of benefits by the individual alien applicant. Receipt of benefits by dependents and other household members would not be considered in determining whether the alien applicant is likely to become a public charge.

Factors that would generally weigh heavily in favor of a finding that an individual is likely to become a public charge include the following:

  • The individual is not a full-time student and is authorized to work, but cannot demonstrate current employment, has no employment history, or no reasonable prospect of future employment;
  • The individual is currently receiving or is currently certified or approved to receive one or more of the designated public benefits above the threshold;
  • The individual has received one or more of the designated public benefits above the threshold within the 36 months immediately preceding the alien’s application for a visa, admission, or adjustment of status;
  • The individual has been diagnosed with a medical condition that is likely to require extensive medical treatment or institutionalization or that will interfere with the alien’s ability to support himself or herself, attend school, or work, and the alien is uninsured and has no prospect of obtaining private health insurance; or
  • The individual has previously been found inadmissible or deportable based on public charge.

Alternately, factors that would weigh strongly against a finding that a foreign national is likely to become a public charge include:

  • The individual has financial assets, resources, and support of at least 250 percent of the Federal Poverty Guidelines for a household of the alien’s household size; or
  • The individual is authorized to work and is currently employed with an annual income of at least 250 percent of the Federal Poverty Guidelines for a household of the alien’s household size.

This proposed rule could have wide-reaching effects on legal immigration to the United States. The rule proposes not only to define “public charge” and the factors to be considered in making current and prospective public charge determinations, but also to add requirements for “public charge bonds” for certain applicants who are more likely to become a public charge. It is important for interested parties to comment on this proposed rule by the Dec. 10, 2018 deadline.

By Robert Y. Maples on Posted in Continuing Resolution (CR), EB-5, HR 6157

The President today signed H.R. 6157, a bill making Appropriations for Defense and Labor Health and Human Services & Education with a continuing resolution for other government programs not reauthorized by Oct 1. The continuing resolution prevents a government shutdown and extends vital programs, such as the EB-5 immigrant investor program, among others until Dec. 7.

To date, Congress has approved five of 12 appropriations bills. A four-bill minibus is in conference and the balance of three appropriations bills await further action. It is widely believed that additional congressional action will occur after the upcoming mid-term elections in November.

By Nataliya Rymer on Posted in China, Department of State, EB-5, EB-5 Legislation, EB-5 Processing Times, EB-5 Program, Green Cards, I-526, Immigrant Green Card, Immigrant Investor, Immigration, Immigration Law, State Department, USCIS, Vietnamese, Visa

This coming October, USCIS is allowing a number of foreign nationals to apply for adjustment of status earlier than they would otherwise be eligible. Specifically, USCIS has announced that it will allow individuals with immigrant petitions in employment-based categories to apply for adjustment of status based on the cutoff dates in the “Dates for Filing” Chart of the State Department’s monthly Visa Bulletin (Chart B).

As a reminder, in October of 2015, the State Department made a change with respect to its monthly visa bulletin – it added a chart with a set of often earlier cutoff dates it called “Dates for Filing.” The “Application Final Action Dates” chart (Chart A) has continued to reflect the dates on which visa numbers are actually available for the approval of adjustment of status or immigrant visa applications. Chart B, on the other hand, was instituted to reflect an earlier set of cutoff dates which the State Department has historically used to begin initiating the immigrant visa cases. Since implementation, and when allowed by USCIS subject to monthly determinations, Chart B cutoff dates have provided individuals in the U.S. with valid nonimmigrant status the opportunity to file their adjustment of status applications prior to the date immigrant visas were available for approval, which in turn has given these individuals the opportunity to remain in the U.S. as green card applicants and obtain related benefits such as employment and travel authorization.

Since implementation of this change in October 2015, USCIS has only allowed on very limited occasions for employment-based applicants to utilize Chart B for the filing of their adjustment of status applications. Historically, as their number is far fewer, family-based applicants have been able to take advantage of these earlier dates, while the employment-based applicants have continued to rely on the cutoff dates in Chart A for their filings. Therefore, this announcement constitutes a rare opportunity for employment-based applicants to file their green card applications earlier, and in some cases significantly earlier, than anticipated. Specifically, the October Dates for Filing chart provides the following cut-off dates:

 

Mainland China-born EB-5 investors in the U.S. in lawful temporary visa status can file adjustment of status applications if the priority date of their approved I-526 petition is earlier than Oct. 1, 2014. The Chart B cutoff date is over a month later than the Aug. 15, 2014 cutoff date in Chart A, which extends the benefit of being able to file their green card application to a significant additional number of approved EB-5 Chinese investors. Furthermore, for Vietnamese-born EB-5 investors, Chart B for October is current, which means that all those Vietnamese investors and dependents with approved I-526 petitions who are in the U.S. in valid temporary visa status, regardless of the priority date of their petition, can file their green card applications in the month of October.

Importantly, applications for green cards filed pursuant to Chart B do not secure protection under Child Status Protection Act (CSPA), the application of which continues to be determined based on Chart A – the availability of immigrant visas for final adjudication/approval. In addition, important considerations for filing exist for individuals in certain visa statuses in the U.S. For details, please contact your GT attorney.

By Robert Y. Maples on Posted in Continuing Resolution (CR), EB-5, EB-5 Immigrant Investor Program

Yesterday, by a bipartisan vote of 93-7, the U.S. Senate passed H.R. 6157, making appropriations for the Department of Defense and Labor, Health and Human Services, Education and related agencies and providing for continuing appropriations until Dec. 7 for other programs, including EB-5 immigrant investor program extension.  

This appropriations package funds the two largest segments of the U.S. budget, which are among the top priorities for annual funding. The inclusion of the Continuing Resolution in this strategic and important legislative package helps to ensure consideration and passage before appropriations lapse on Sept. 30. 

The House is expected to take up the Senate-passed legislation next week upon their return from break.