Updated EB5 Guidance on Investment Timeframes and Impact of Terminated Regional Centers

The U.S. Citizenship and Immigration Services (USCIS) recently announced the publication of updated guidance regarding changes made to the EB5 immigrant investor program as a result of the EB5 Reform and Integrity Act of 2022 (RIA). The updated guidance addresses the required time that the invested capital must remain invested and discusses whether pre-RIA investors are protected by a particular RIA provision related to having invested in a regional center that was later terminated.

Changes to Investment Timeframe

The updated guidance clarifies that investments made since enactment of the RIA are only required to be sustained for two years. This is a major change from what existed under the previous rule.

Prior to the RIA, funds were required to remain invested in the EB5 business until the end of the initial two years of conditional residency. Given the lengthy processing times for form I-526 petitions and backlogs in some of the EB5 categories, this meant the USCIS routinely required that the funds remain in the project for many years for the investor to qualify.

Based on the RIA, however, the updated guidance clarifies that post-RIA investors need only keep their funds invested for a total of two years. The guidance specifies that the two-year period is interpreted to commence on “…the date that the full amount of qualifying investment is made to the new commercial enterprise and placed at risk under applicable requirements, including being made available to the job creating entity, as appropriate.” So, once the two-year period has passed, even if the investor’s I-526 or I-526E petition remains pending, it may be possible to withdraw the investment without jeopardizing the pending EB5 case.

It is important to note that this change applies only to the immigration requirements. An EB5 investor who invests in a regional center still must consider the terms of the contract, which may call for a much longer investment period than the two-year requirement.

Treatment of Pre-RIA Investors Associated with Terminated Regional Centers

The RIA added a provision that enables certain investors associated with terminated regional centers to nevertheless maintain eligibility to become conditional permanent residents under the EB5 program. The updated guidance clarifies that the RIA also applies to qualifying pre-RIA investors. For instance, if a regional center is terminated “for purely administrative noncompliance” the USCIS still may approve the case in situations where it is determines that the investment and resulting job creation are not impacted.

Conclusion

The guidance underscores the commitment of the USCIS to implement the changes mandated by the RIA in a manner that benefits investors, while maintaining program integrity and adherence to statutory requirements. It provides greater clarity and flexibility for investors navigating the EB5 program in the post-RIA landscape.

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