The EB-5 Visa is set to expire September 30th but a new bipartisan bill in the Senate is set to renew it... with some fairly significant changes. For those of you who are not aware, the EB-5 program is a special visa for foreign investors who bring some major cash investments to the States (looking at you, China). Although these changes may give the U.S. even higher investments, the revisions are also confusing and have left a lot of foreign investors scratching their heads and asking "why?"
The Current Law:
Under the current EB-5 requirements, foreign investors will qualify for the special visa if they (1) invest in a new commercial enterprise that (2) creates or preserves at least 10 full-time jobs and (3) includes an investment of $500,000 to $1 million (depending on whether or not the enterprise is located in a "Targeted Employment Area"). This visa is extended to the immediate family of the EB-5 recipient making coming to America much easier. The U.S. limits EB-5 visas to 10,000 per year and the desire for these visas is growing rapidly. In 2008, the U.S. received a little over 1,200 applications; in 2013 the U.S. received about 6,300 applications. In 2014, the U.S. received over 10,000 applications which is the first year the maximum allocation was granted. NBD.
The Proposed Revisions:
The proposed revisions currently resting in Congress would increase the investment range from to $800,000 to $1.2 million. The new law would also have a mechanism for adjusting this range every five years based on the U.S. Consumer Index.
The proposed new law also specifies that in a "Targeted Employment Area," at least 50% of the job creation must be within the statistical area or county where the Targeted Employment Area is located. Speaking of the job growth factor, this part of the revised law is quite confusing and unclear when the commercial enterprise is part of a regional center and when other factors are contributing to job growth. There is also new provisions written into the bill such as oversight and review requirements, new USCIS enforcement authority, and new requirements regarding Securities laws. Fun stuff.
With increased interest in the EB-5 visa, it can be assumed that the program will be renewed. However, it may become more difficult to obtain and understand if this proposed bill becomes law. For those of you interested in the EB-5 program, we'll be watching as the renewal bill develops.