Late last month, the U.S. Department of State announced that as of August 23, 2014, immigrant visa numbers for Chinese nationals in the EB-5 category would be unavailable through September 30, 2014. This notwithstanding, when the U.S. Department of State issued its October Visa Bulletin, the EB-5 category showed as current for all nationalities.
While not totally unexpected (Form I-526 filings increased by 504% between 2008 – 2013), the announcement underscored the need for true immigration reform. As background, the EB-5 visa category is an immigrant option available to a foreign investor who contributes $1 million to a new business or commercial enterprise (one created after November 29, 1990) or an expanded business (which is defined as a business that will expand to 140% of its pre-investment number of employees or net worth) and will create at least 10 jobs for U.S. workers. If the commercial enterprise is in a targeted employment area (defined as a rural area or an area where the unemployment rate is 150% of the national average), the required initial investment is only $500,000. Once the EB-5 visa petition is approved, the foreign investor and his or her family members are granted conditional permanent residence status for two years. After two years, the foreign investor can seek to have the conditions removed by filing Form I-829 with the California Service Center. The petition, however, must be accompanied by evidence that: (i) the investor has made the required (or is in the process of making) capital contribution; and (ii) the investment has created or will create at least 10 full-time jobs for qualified U.S. workers. Provided that the foreign investor is able to meet the burden of evidentiary proof required by USCIS, the foreign investor is granted legal permanent resident status. (For more information on the EB-5 Program see my article in our firm Fall 2012 “insights” newsletter.)
Due to the significant visa backlogs in the most common employment-based visa categories, the EB-5 visa is an attractive option for Chinese nationals. In fact, about 85 percent of EB-5 visas issued in last year were issued to Chinese investors. After China, South Korea, Taiwan, Iran, and Venezuela rounded out the top five countries. For this reason, it not surprising that the 10,000 immigrant visa numbers for Chinese nationals were exhausted by the end of August 2014.
While it is certainly great news that the EB-5 category shows current once again, the bad news is that with the increased popularity of the EB-5 immigrant option, it is a likely scenario that EB-5 immigrant visas will run out quicker next year. This is a reminder that until the federal government truly engages in serious immigration reform, our clients are faced with limited immigration options.