On June 24, Judge Vince Chhabria of the Federal District Court for the Northern District of California granted Behring Regional Center’s motion for a preliminary injunction against the decision of the U.S. Citizenship and Immigration Services (USCIS) to deauthorize over 600 EB-5 regional centers, bringing smiles and relief to thousands of applicants affected by the agency’s order.
The USCIS, on June 2, deauthorized the designated regional centers licensed to operate on EB-5 immigrant investor visa program. To retain authorization, these regional centers had to refill Form I-956F, which can only be filed by an approved regional center. Centers can use Form I-956G to provide the required information, certifications and evidence to support their continued eligibility to be designated as a regional center. This must be submitted in compliance with new program requirements. The filing fee is $17,795 for Form I-956F, and $3,035 for Form I-956G.
The popular EB-5 Regional Center program lapsed on June 30, 2021. It was not a permanent program, and required congressional approval each time the program needed an annual extension. The EB-5 Regional Center program’s extension was always tied to the federal government’s omnibus budget bill. Since the budget is a must-pass bill, the EB-5 Regional Center program extension was never in question.
In 2020, however, the EB-5 Regional Center program was removed from the budget bill, requiring Congress to separately authorize its extension through the passage of a law after the program lapsed on June 30, 2021. The new congressional approval came only in March 2022.
The lapse in the EB-5 Regional Center program had put over 80,000 applicants (mostly from China and India) in a state of limbo because their green card application processing came to an abrupt halt, putting both their investment and future at risk.
In the new 2022 law – called the EB-5 Reform and Integrity Act, 2022 – the minimum investment for new EB-5 applicants was raised from $500,000 to $800,000 for investments in Targeted Employment Areas (TEAs) or infrastructure projects, and for other areas this was raised from $1,000,000 to $1,050,000. There is a provision to increase the minimum investment figure every five years from January 2027 onwards.
Invest in the USA (IIUSA) and other regional centers reacted sharply to the now-redundant USCIS decision, calling it “arbitrary.”
Founded in 2005, IIUSA is a not-for-profit national trade association for the EB-5 Regional Center industry. It advocates making the EB-5 program permanent.
Welcoming the federal court’s decision, Aaron L. Grau, Executive Director, IIUSA, told indica, “IIUSA is very pleased with the ruling and we look forward to continuing to our work to finalize a positive outcome for the whole industry.” IIUSA is an amicus in this case and has moved to intervene on behalf of over 100 regional centers across the country. Asked does it apply to all regional centers are authorized to work, Grau said, “The ruling does apply to all regional centers.”
Judge Chhabria in his preliminary injunction stated: “Of course the agency (USCIS) may do whatever is reasonably necessary to ensure that the existing regional centers comply with the Integrity Act, but those centers must presently be permitted to operate within the regime created by the Act. This includes processing new I‑526 petitions from immigrants investing through previously authorized regional centers like Behring, just as the agency would do for a newly approved regional center.”
H. Ronald Klasko, Chair of the Best Practices Committee of IIUSA and one of the top EB-5 immigration lawyers in the U.S. told indica, “We agree with the ruling – both the legal conclusion that USCIS acted improperly in stripping regional centers of their designations and in giving the injunction nationwide impact. It is a huge victory since the Regional Center program can proceed unabated as Congress intended.”
Vivek Tandon, the founder of EB-5 BRICS, based in Beverly Hills, California, described it as “universal relief”, and told indica that it is “a big win for the EB-5 industry.” Tandon said, “This ruling provides universal relief to all EB-5 regional centers from USCIS’s interpretation of the EB-5 Reform and Integrity Act of 2022.”
Tandon said that despite President Joe Biden signing the EB-5 Reform and Integrity Act 2022 (RIA) into law on March 15, 2022, USCIS has taken the position that investors cannot file their EB-5 application until the regional center that sponsors the investment project gets ‘re-certified.’ He said, “Given the ruling, we believe there is no impediment to RCs immediately filing project I-956Fs – and only some proof of filing 956F as the statutorily-required trigger to filing I-526s for investors.”
Los Angeles-based Mayank Mohan, who offers independent EB-5 services, told indica, “EB-5 is all about jobs creation. From the government objectives standpoint, we’d like to see more jobs created in a recession-like situation. If the government relaxes the method, then you will see a lot of inflow. The EB-5 not only provides the economy a boost, but such investments come with the benefit of a green card.”
According to IIUSA, between 2008 and 2021, the EB-5 Regional Center program helped generate $37.4 billion in foreign direct investment to create and retain U.S. jobs for Americans, all at no cost to the taxpayer.
The EB-5 visa was created by Congress in 1990 to stimulate the U.S. economy through job creation and capital investment by foreign investors. Under a program first enacted as a pilot in 1992 and regularly reauthorized since then, investors may also qualify for EB-5 classification by investing through ‘regional centers designated by USCIS’ based on proposals for promoting economic growth and offering green cards to foreign investors in return.