A US broker-dealer perspective on the EB-5 Reform and Integrity Act of 2022
What the new law means for investors and regional centers .
By Marko Issever
The new act has many features that should protect investors by imposing onerous clauses for the Regional Centers ( RC ). Many of them were already complying with these requirements voluntarily . Now , it is the law . Therefore , not only RCs but investors and intermediaries such as migration agents , broker-dealers , and consultants must abide by them . 1
When established in 1990 , the mission of the EB-5 program was to create much-needed American jobs . First , the program was strictly a direct investment program . A couple of years later , the RC-augmented program provided considerable flexibility for potential EB-5 investors . Many large-scale project owners were able to employ thousands of Americans as its global popularity and recognition increased .
In the last few years , given their urban locations , there has been considerable disagreement on the benefits of many RC projects , despite many advocates defending their contribution to the US economy . 2 Under the previous law , to qualify for targeted employment area ( TEA ) designation , project sponsors could use a much larger area surrounding the project . Under the new law , they can only use the census tracts adjacent to the