The EB-5 investment program offers foreign nationals from all nationalities the chance to become permanent residents of the United States. Billions of dollars of EB-5 investment funds have been poured into U.S. businesses since the EB-5 program began in 1990; investors and U.S. business owners alike recognize the many accomplishments of the EB-5 industry.
For all its merits, the EB-5 program does have to contend with several issues, including notoriously slow processing times for EB-5 visa petitions. United States Citizenship and Immigration Services (USCIS), which adjudicates all EB5 investment visa petitions, can take years to process Form I-526. This petition must prove that an EB-5 investment has been made in harmony with USCIS guidelines.
In addition to USCIS’s extended processing times, the EB-5 process can also be lengthened by requests for evidence (RFEs). USCIS sends an RFE when it deems that the information provided in an investor’s visa petition is incomplete, incoherent, or otherwise deficient. In many cases, RFEs for I-526 petitions point out issues in the EB-5 project’s business plan. We now examine common issues in EB-5 business plans and how to address these shortcomings when responding to an RFE.
Incomplete or Unclear Information
USCIS expects EB-5 business plans to provide abundant information on the project: its structure, potential for job creation, overall capital stack, and other details. Moreover, all projections must be supported by credible data. If a business plan is missing vital information, USCIS will likely send an RFE. Internal discrepancies in a business plan, such as inconsistencies regarding launch dates or the budget, may also result in an RFE.
RFEs usually specify what content is unclear or missing. EB-5 investors can either provide these materials or, in some cases, submit a new version of the business plan altogether. When the missing information is straightforward, investors can simply attach the needed documents to their response; if USCIS’s concerns are wider in scope, it may be preferable to update the whole business plan.
Minor inconsistencies within the business plan can usually be clarified without a substantial revision.
Lack of Compliance with EB-5 Regulations
The EB-5 program sets out a myriad of regulations governing the structure of EB-5 projects, how investments are made, the at risk status of the EB-5 investment, and other factors. Unfortunately, if the business plan clearly indicates a lack of compliance with USCIS guidelines, responding to the RFE won’t solve the issue. In contrast, an apparent lack of compliance may be the result of an inaccuracy or mistake in the business plan; investors in this situation should amend their business plans accordingly.
As mentioned previously, USCIS may take years to adjudicate an investor’s Form I-526. Consequently, the agency may send an RFE asking for proof that the EB-5 project has complied with the job creation criteria or met other requirements. Project documents such as tax and employment records can be used to provide the needed evidence.
Investors will need to plan carefully and consult with EB-5 professionals to obtain their green cards. Admittedly, complying with USCIS regulations and gaining approval for Form I-526 can be challenging; still, the thousands of foreign nationals who have successfully relocated to the United States attest that the effort is well worth it. EB5 Affiliate Network (EB5AN) offers valuable guidance to its investor clients, including RFE response consulting.