A blog about U.S. immigration matters by Paul Szeto, a former INS attorney and an experienced immigration attorney and counsel. Contact Info: 732-632-9888, http://www.1visa1.com/ (All information is not legal advice and is subject to change without prior notice.)

Friday, July 26, 2019

New Rule to increase minimum EB-5 investments to $800K and $1.9 million

The employment-based investor visa, or EB-5 visa, will be undergoing significant changes as shown in a final rule published by USCIS on Wednesday.  These changes, which will take effect on November 21, 2019, are meant to update the visa requirements to account for inflation and procedural changes, which have not been addressed since 1993.

The EB-5 visa is intended to encourage foreign investors to bring capital investment and create jobs in the U.S. The visa allows for permanent residence with conditions, which can be removed two years later. Job creation requirements remain the same -- investors must create at least 10 full-time jobs for qualified workers in the U.S or help a troubled business maintain its number of employees.  Jobs created for the investor or his family members do not count.  

Capital investment requirements have undergone significant changes. An investor can invest capital in certain economically depressed areas targeted by the government called Targeted Employment Areas (TEA).  The minimum investment required for TEA by investors is being raised from $500,000 to $900,000.

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TEA can refer to rural areas or areas with high unemployment rates, both of which would benefit greatly from economic investment. TEA definition has been narrowed to cities and towns outside of metropolitan statistical areas (MSA, or areas of high population density and close economic ties). Technical changes have also been made to the TEA definition to better identify economically distressed communities.  DHS will also take over from the States the responsibility of designating specific areas to be TEAs.  The TEA investments are usually facilitated through specific business entities called "regional centers," which invest in projects located in targeted areas. As of July 8, 2019, there are 880 regional centers approved by the USCIS.

On the other hand, an investor can invest funds directly in other parts of the U.S. economy.  The minimum investment for non-TEA will also increase, from $1 million to $1.8 million.

Petitions filed before 11/21/2019 will be held to the old minimum investments and those filed on or after 11/21/2019 must follow the increased minimum investments. According to the final rule, these amounts will continue to change every five years to adjust for inflation.

The procedure to removing conditions on EB-5 permanent residence has changed. Dependent children that reached the age of 21 or married during their conditional residence, as well as dependent spouses that divorced from the principal investor during this time, must file Form I-829 separately. They will no longer have to option to be included in the principal investor's I-829 petition.

Investors will also be able to keep priority dates for previously approved EB-5 petitions when they file a new one.  

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