Wednesday, April 19, 2017

New EB-5 Draft Bill potential impact on Chinese Market

Senator Grassley and Senator Leahy introduced a new rough draft of “American Job Creation and Investment Promotion Reform Act” on April 15, 2017. The updated bill would provide incentives to rural communities, priority urban investment areas, infrastructure projects and manufacturing projects. The overall perception of the updated draft is very positive in the Chinese marketplace. The increase of investment capital to $800,000 and $1,000,000 would change the EB-5 investors market especially in China. As China’s middle class continues to struggle to find capital at the current $500,000 level, the new bill would make the new EB-5 Program a true investment program for only high net worth individuals. This would result in a more sophisticated investor market and an overall smaller market size. The smaller market size would mean fewer investors but also a shorter waiting period for the current visa backlog.

The visa set asides for rural areas and priority urban investment areas change the focus of the EB-5 Program back to the intent of the original legislation. An increase in transparency, integrity enhancements and restriction of foreign involvement in the program will create a positive reputation for EB-5 program across the world. The potential impact in the Chinese market would be very positive and would provide certainty for the next 3 years. The proposed draft bill is well received by Chinese migration industry.

We will continue to monitor the new bill as there are only a few more working days in congress until the EB-5 Program expires on April 28th.  

Join us in Chicago on June 6 to discuss the latest trends and regulations on Chinese outbound investment, register at http://2017investusa.eventbrite.com

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