EB5 Investors Magazine - Page 48

Continued from page 45 For example, if the new commercial enterprise (NCE) in which the investors invest also owns the project entity itself (i.e., “equity structure” project), and return of capital to investors hinges on sale of the project, could the NCE sell the project before all investors’ I-829 petitions have been adjudicated? Under current USCIS policy, it might not be able to do so, as premature sale would sever the nexus between the NCE and job-creating activities on which later I-829 approvals would rely. Forcing an NCE to continue operating a project until all investors’ I-829 petitions have been approved could create economic hardship to the NCE. Moreover, if the NCE were unable to sustain operations indefinitely due to economic conditions, despite the NCE’s good faith efforts, USCIS might consider the failure of the long-term operation as a basis for denying later-filed I-829 petitions for Chinese investors, even though USCIS had long since approved I-829 86% I-526 approvals to applicants petitions filed earlier for from mainland China non-Chinese investors. This is one of many areas in which the Chinese EB-5 backlog may end up harming non-Chinese and Chinese investors alike if the Chinese backlog Source: Association to Invest is not ameliorated. in USA (IIUSA)] 10,000 6,000 3,000 0 Problems could also arise for regional centers or developers for projects funded through a “loan structure,” in which the NCE loans EB-5 investor capital to a separate job-creating entity (JCE). If the JCE has finished the project and has fully repaid the NCE, may the NCE use the repayment proceeds to buy out investors whose I-829 petitions have been approved and then hold the remaining funds in the NCE pending later-filed Chinese investors’ I-829 adjudications? Unfortunately, the answer is unclear under current USCIS policy. Overall, regional centers and developers must be prepared to navigate murky USCIS policies on these and other issues, adapt to changing rules, and manage all of their investors’ expectations along the way, as the Chinese EB-5 retrogression takes hold and the delays continually grow. Both the American Immigration Lawyers Association (AILA) and the Association to Invest in the USA (IIUSA) have established respective subcommittees to research and recommend to USCIS potential solutions that increase predictability of the EB-5 program caused by Chinese EB-5 retrogression, but the outcome of such efforts is extremely difficult to predict, as is the likelihood that Congress might increase the visa numbers through legislation. Minimizing the impact on Chinese investors Despite the impending retrogression, EB-5 investors from Pricipal Investors Family Members China can still make their investment and file their I-526 petitions with USCIS. USCIS will continue to adjudicate the I-526 petitions as usual, because the visa cut-off dates do not impose a delay until after the I-526 petition is approved (i.e., the cut-off dates are imposed only on the green card applications themselves: the DS-260 application abroad or the I-485 application at USCIS). The following are suggested strategies for immi46 gration attorneys to reduce the negative impact visa backlogs impose on Chinese investors. (These points are described in greater detail in Strategies for Dealing with Retrogression). • File the I-526 as soon as possible to try to get a position as early as possible in the queue; • File the I-526 case while the child is still 18 years of age or less—this will help prevent the chan ces that the child will “age out” before the visa application can be filed and approved; • Consider filing the case in the child’s name alone— this will allow the child to apply for a visa when numbers are available, regardless of their age. However, parents of the child investor will not qualify as derivatives to their child’s application; • Consider making two investments: one filing for the parents and any qualifying children, and a second case for the child who may age out, or has aged out; • As an interim measure, consider utilizing appropriate nonimmigrant temporary worker visas to bring the family to the United States in months, rather than years, while they are waiting for their EB-5 cases to work 86% throughI-526 approvals to applicants benefit could be the the system. An added from for adjustment ability to apply mainland China of status by mail instead of attending an immigrant visa interview at a U.S. consulate or embassy when visa numbers are available. USCIS has stated that investments in regional center projects or direct investments are adjudicated equally, on the same timeline and without distinction. Historically, direct investment cases were handled more expeditiously. Now, however, direct investment adjudications seem to be taking longer to adjudicate than regional center project investment cases. Once retrogression begins, it seems that an investor’s I-526 form will be adjudicated long before the investor will become eligible for a green card, in any event. Regardless of the investment method, investors and practitioners working on their behalf need to be aware of the impacts of retrogression and strategies on how to navigate them. 10,000 6,000 3,000 0 Source: Estimate from Charles Oppenheim of U.S. Department of State Pricipal Investors EB5 INVESTORS MAGAZINE Family Members