The EB-5 Reform and Integrity Act of 2022 (“RIA”) was signed into law on March 15, 2022, after years of negotiations and iterations of how the EB-5 program would proceed after its program expiration. The RIA extended the EB-5 program by five years, whereas in the past, it was always under the threat of sunsetting, and in 2021, it did expire with no renewal, leaving the EB-5 industry in a holding pattern that was uncomfortable for both investors and projects alike.
The RIA gave some stability to the program- and with it, introduced some key changes aimed at protecting the investor and the integrity of the program. Some important changes are highlighted below:
- Prior to the RIA, investors were required to sustain their investments throughout their conditional permanent residence. Due to backlogs and adjudication times, many investors never obtained conditional permanent residence status, and thus their investment was essentially “frozen” for an indefinite period of time. With the enactment of the RIA, investors are now only required to sustain their investments for two years after the investment has been made available to the job-creating entity (“JCE”) and placed at risk, so long as job creation requirements have been met. In many cases, this has removed years of having an investor’s investment tied, and opened up the optionality of having their investment returned after two years. Though there is no direct language pinpointing when the two-year period begins, USCIS has issued guidance that it is either 1) at the time the investment is placed at risk and made available to the JCE, or 2) if the investment was more than two years before the filing of the EB-5 petition, that the investment was still maintained at the time the petition was filed. This does not preclude the project from retaining the investor’s investment longer than the two-year period.
However, it is important to note that those investors who filed EB-5 petitions prior to the RIA are still subject to the previous provisions and must sustain their investments throughout the conditional permanent residence period. To review, conditional permanent resident status begins either at the approval of the adjustment of status application, or if the investor is consular processing, the date the investor enters the U.S. with their immigrant visa. - After enactment of the RIA, investors will no longer face the same obstacles in some instances if the regional center was terminated that housed a project in which they invested. This eases anxiety, as previously, the termination of a regional center would have been considered a material change that contributed to the investor’s eligibility if they had not reached the conditional permanent residence stage, and the investor would have faced their EB-5 petitions being revoked or denied. Under the RIA, good faith investors may be able to retain eligibility in certain circumstances.
Fortunately, this provision would also be retroactive in nature and apply to pre-RIA investors. It also allows for USCIS to issue requests for evidence (“RFE”) or a Notice of Intent to Deny (“NOID”) to offer the investor a chance to respond and prove if they are eligible. Of note is that this provision allows protection for an investor in most cases where termination of a regional center does not affect investment or job creation; however, each case will be reviewed separately to determine if there were substantive changes. - The RIA provision introduces a much more streamlined approach to filing for the investor. The new provisions require that the regional center must file a separate application for each project (Form I-956F), but after such filing, the investor is able to file their EB-5 petition, and not include all the onerous documents associated with the project.
- The biggest change, of course, is allowing an investor who is in the United States to file an adjustment of status application concurrently with their EB-5 petition, thus availing the investor the ability to remain in the U.S. and obtain travel and work authorization. Prior to the RIA, investors were in a situation where they could not file the adjustment of status application until the EB-5 petition was approved, which meant for many, a loss of the ability to remain in the U.S., and the inability to work or travel internationally.
The above article is intended for informational purposes only and is not based upon any specific set of facts. Anyone with specific questions or issues concerning EB-5 or H1-B should consult an immigration attorney.
