Senator Paul has got it right. This bill fixes the program but doesn’t throw the baby out with the bath water. Because Rand Paul is a powerful senator, hopefully this proposal will be taken seriously, as it offers the best solution to the problem of the visa backlog for Chinese EB-5 investors. However, it is presently not likely to be the main EB-5 reform bill; that will likely come from Senator Grassley (R-IA), with Senators Cornyn (R-TX) and Schumer (D-NY) as supporters. Congress appears to want to reform the EB-5 Program prior to expanding its use, so once those other difficult issues are resolved (minimum investment amount, TEA reforms), there may more EB-5 visas in the future.
Here are 5 things to know about the new proposed EB-5 bill.
- Permanent Reauthorization of the EB-5 Regional Center Program. The bill would amend section 203(b)(5) of the Immigration and Nationality Act to permanently reauthorize the EB-5 Regional Center Program. This is an important development, as it shows that members of U.S. Congress continue to support the job creation program, and also provides the needed stability to the EB-5 Regional Center Program that has been lacking in the past 3 years.
- Exclusion of EB-5 Visas from Country Caps. The bill would exclude EB-5 visas from counting towards the “per country” numerical limitations of either 7% (in the case of a single foreign state) or 2% (in the case of a dependent area). This could shorten the amount of time it currently takes Chinese EB-5 applicants to enter the U.S. after their respective Form I-526s are approved.
- Preapproval of New Commercial Enterprises. The bill would require USCIS to establish a “preapproval procedure” for new commercial enterprises (“NCEs”) to obtain USCIS approval prior to submission of any Form I-526 petitions by EB-5 immigrant investors. This would be optional for NCEs, not required. USCIS would then be required to make a determination on the proposal within 180 days after filing, or to issue a request for evidence (“RFE”) within 30 days after filing.
- EB-5 Regional Center Restrictions and Compliance. The bill includes “integrity measures” that would prevent individuals with prior criminal or civil violations related to fraud or deceit from being associated by an EB-5 Regional Center, NCE, or job creating entity. It would require all principals or administrators of an EB-5 Regional Center to be U.S. nationals or green card holder. Additionally, no foreign government entity may be directly or indirectly involved with the ownership or administration of an EB-5 Regional Center.
- EB-5 Regional Center Termination. The bill would authorize USCIS to suspend or terminate the designation of an EB-5 Regional Center or impose other sanctions against an EB-5 Regional Center if there are securities law-related issues such as fraud, misrepresentation, or deceit associated with the EB-5 investment offering.