We reported on August 12 the good news that the USCIS is reporting faster processing times for EB5 immigrant investors [https://www.globalmobilityreview.com/update-for-immigrant-investors-in-the-us]. These faster petition processing times led to a larger number of conditional resident approvals for EB5 investors, which is also good news. The bad news is that the limited supply allocated to EB5 investors born in mainland China is now exhausted and no further supply will be available until October 1, 2014. This problem does not impact individuals born in other countries. It also does not impact the approval of the Form I-829 petition to remove the conditional basis of EB5 resident status after two years. The government will continue to approve those cases.
This is the first time that EB5-based conditional resident status has become unavailable since this immigrant visa category was created in 1990. Because the limited supply of immigrant visas are allocated both by visa category and place of birth, only EB5 conditional resident applications for individuals born in mainland China are impacted. Individuals born in any other country are still immediately eligible to be granted EB5 conditional resident status. People born in Hong Kong and Macau are not subject to the mainland China quota. Furthermore, EB5 investors born in mainland China can still immigrate if they have an accompanying spouse born outside mainland China, since the government’s chargeability rules allow using the other family member’s country of birth.
Fiscal Year 2015 starts on October 1, 2014. The new annual allocation of EB5 conditional resident immigrant visas becomes available then and conditional resident approvals will resume. The government has not announced how many such applications are already pending or when the Fiscal Year 2015 quota is likely to run out for EB5 investors born in mainland China.
For long-term planning, this is a wake up call to EB5 projects that overly rely on mainland China as a source of EB5 investor funds. While mainland China historically is the largest supplier of EB5 investors, the EB5 program is available and used by individuals born in other countries. Until and unless US law is amended to remove the country quota limits on EB5, business developers are well advised to expand the source of investors to other countries to avoid the delays that will likely begin to hamper exclusively Chinese funded projects.
