The EB-5 investment industry has undergone several important changes since 2019. In November 2019, the controversial Modernization Rule changed the guidelines for targeted employment area (TEA) designation and raised the minimum investment amounts significantly. Since the higher minimum investment amounts of $900,000 for TEA projects and $1,800,000 for non-TEA projects made the EB-5 program less accessible for foreign nationals, the industry as a whole was opposed to the Modernization Rule.
However, EB-5 investors received momentous news on June 22, 2021: the U.S. District Court of the Northern District of California ruled that the Modernization Rule had been implemented improperly by the Department of Homeland Security (DHS). As a result of this ruling, the Modernization Rule was invalidated, and its controversial changes were reversed. EB-5 stakeholders celebrated the court’s ruling, and numerous investors rushed to file their I-526 petitions at the minimum amounts of $500,000 for TEA projects and $1,000,000 for non-TEA projects.
Now, the EB-5 program is at a crossroads once more: United States Citizenship and Immigration Services (USCIS) appealed the aforementioned court decision on August 23, 2021. A federal appellate court will once again examine the lawsuit. If the appellate court rules in favor of the Modernization Rule, then USCIS will have succeeded in raising the minimum EB-5 investment amounts once more and reimplementing the other changes. EB-5 investors and project developers are awaiting the court’s decision in suspense.
Possible Consequences of the Appeal
EB-5 investors who have filed Form I-526 at the lower amount of $500,000 may be understandably concerned—how will USCIS’s appeal affect their visa petition? If USCIS wins the appeal, will it reject visa petitions filed at the lower amounts during the Modernization Rule’s lapse?
Investors who filed their petitions at the pre-Modernization Rule amounts can rest at ease. USCIS did not file a motion to stay the Modernization Rule’s repeal, and the agency is currently accepting all direct EB-5 investment petitions filed at $500,000. This shows that USCIS will, in all probability, continue to process these petitions even if it wins the appeal.
Foreign Nationals Should Hurry to Invest at the Lower Amounts
Even if the appellate court does not rule in USCIS’s favor, the Modernization Rule will likely be reimplemented at some point. Therefore, foreign nationals planning an EB5 investment should act quickly to invest at the lower amount of $500,000. EB5AN offers the most trustworthy EB-5 investment opportunities and helps investors get started on the path to permanent resident status.