EB-5 Retrogression for China Unlikely For Fiscal Year 2013
The U.S. Department of State (DOS) recently announced that visa numbers are expected to remain available for EB-5 investors from China for the current fiscal year. The announcement comes after earlier predictions that visa numbers for Chinese nationals would have been exhausted by the spring of 2013, given the increased demand for these visas.
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According to Mr. Charles Oppenheim of the DOS Visa Office, although EB-5 visa usage by Chinese nationals has increased by seventy five percent (75%) compared to this time in 2012, the demand for visas under the program has declined in recent months.
Original Concerns – Retrogression
Since the implementation of the EB-5 immigrant investor category, there have always been sufficient visa numbers for all investors, including those from China. This fact has certainly added to the attractiveness of the program as it remains one of the quickest ways in which a foreign national may obtain lawful permanent residence in the United States.
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As stated earlier, initial concerns were that China would reach its per country limit before the end of the 2013 fiscal year on September 30, 2013. If the demand for EB-5 visas for Chinese foreign nationals were to exceed the fixed number of visas available to them each year, a backlog would occur and a waiting list system, based on the date a petition was filed (also known as “priority date”), would have to be implemented. Priority dates would necessarily retrogress (move backwards). A retrogression of priority dates would mean that foreign investors could neither adjust their statuses nor apply for their immigrant visas at U.S. consulates overseas until their priority dates became current. A retrogression of priority dates for EB-5 visa applicants from China would affect those who were born in Mainland China (even if they later obtained citizenship or permanent residency in another country). Investors born in Hong Kong, Macau, Taiwan, or other countries would not be affected by any possible future visa backlogs.
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Back to the Basics
The U.S. Department of State (DOS) Visa Bulletin lists the priority dates for which visa numbers for the various employment and family-based categories are available on a monthly basis. If an individual’s priority date falls on or before the date listed in the visa bulletin for the category in which s/he is eligible, then s/he may pursue permanent residence through either the I-485 or consular processing for an immigrant visa during that month.
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Concluding Remarks
The recent DOS announcement that the EB-5 category for foreign nationals from China is likely to remain current until the end of the fiscal year is undoubtedly welcomed news for Chinese investors.
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As the EB-5 program’s popularity continues to increase, however, one cannot help but wonder about the potential implications if the EB-5 category for Chinese nationals was to be oversubscribed sometime in the future. While it is the case that new visa numbers become available on October 1st every year, if the demand from China continues to grow exponentially it can be reasonably expected that wait times for priority dates to become current could one day become an issue of concern. There would be implications for the children of investors who may age out prior to their 21st birthdays who would be ineligible to obtain their green cards through the filing of their parents – the principal investors. Ultimately, the demand for EB-5 visas by Chinese nationals could be negatively impacted if backlogs develop, which would in turn affect the many regional centers who primarily depend on these investors to fund their projects.