Overview of the EB-5 Category
Congress created the employment-based fifth preference (EB-5) immigrant visa category in 1990 for immigrants who invest in and manage U.S. companies that benefit the U.S. economy and create or save at least 10 full-time jobs for U.S. workers. The basic amount required to invest is $1 million, although that amount is reduced to $500,000 if the investment is made in a high unemployment area or rural region. When investors first make their investment, they get a “conditional” green card good for two years. At the end of that time they must prove that they have maintained their investment and have created or saved at least 10 jobs before their conditional status will be removed and they become regular green card holders.
The law allows up to 10,000 foreign investors a year to qualify under the EB-5 program. For a variety of reasons the EB-5 program never took off. At its height in 1997, only 1,300 people obtained green cards through the EB-5 program, only about 13% of the annual limit. Nevertheless, between 1990 and 1998 many people made the required initial investments, created the required number of jobs, and otherwise complied with the applicable requirements. In 1998, without notice or opportunity to comment, the Immigration and Naturalization Service (INS) changed the rules for the EB-5 program, making it extremely difficult for new investors to qualify. The INS also applied the new, more restrictive rules retroactively to investors who had applied in good faith under the old rules. The INS terminated some investors' lawful status and began actions to deport them and their families. As a consequence of the INS's actions, immigrant investors and their families lost their houses, their jobs, their right to be in the United States, and the millions of dollars of investments they poured into the U.S. economy. Litigation is pending challenging the INS's actions.
In 2002 Congress passed a law to help immigrant investors hurt by the INS's actions. The Department of Homeland Security is drafting regulations to implement the new law.
In November 2003 Congress signaled its continued interest in the EB-5 program by passing a five-year extension of the EB-5 regional center pilot program. This subset of the EB-5 program allows the government to set aside up to 3,000 of the 10,000 EB-5 green cards each year for investors who invest in designated governmental or private regional centers. EB-5 petitions filed through regional centers only have to show indirect, not direct, job creation. This makes it easier to attract foreign investors.
Since the five-year extension passed in November 2003, Congress has continued to show strong support for the EB-5 program and issued two subsequent three-year extensions, including the most recent in September 2012 in which Congress re-authorized the program through September 30, 2015.
Over 225 EB-5 regional centers exist around the United States. For a complete list of approved regional centers, visit www.uscis.gov/eb-5centers.
Click here for a more detailed summary of the EB-5 law.