January 23, 2019
Proposals to increase the minimum investment amounts for the US EB-5 investor visa have been the subject of intense debate in recent times. Specifically, TWO proposals have been put forth. Following are the two :
1. Senators Grassley & Cornyn have proposed that the minimum investment amounts be raised to $800,000 for TEA & $1,000,000 for the general category OR $800,000 FOR TEA $925,000 for the general category.
2. The Department of Homeland Security has proposed the following minimum investment amounts :
(a) $1,350,000 for TEA, and
(b) $1,800,000 for the General category
Though it is currently uncertain as to which of the two proposals (if at all) would be accepted (or perhaps a middle ground), it is important to note one significant fact – Both of the above proposals impose such high hurdles to qualify for the lower TEA category, that it is very likely that in the event of either one being accepted, the higher general category could become the market standard.
Interpretations of the above two proposals have led to varying responses from industry stakeholders :
● Some argue that raising minimum investment amounts will reduce the number of I-526 applications but raise the amounts actually raised. This could result in more EB-5 capital raised from a fewer number of EB5 investors (a phenomenon recently observed in New Zealand), and also reduce the administrative burden & costs because of fewer applications needing to be processed.
● Others, particularly from emerging markets, argue that a substantial increase in minimum EB5 investment amounts would deprive an already fragile market of investment visas & further curtail demand which is already stressed due to retrogression.
It is our belief that the following will definitely happen :
1. There will be an increase in minimum investment amounts for both the TEA & General categories.
2. The minimum investment amounts could be increased to between $900,000 – $1,800,000
3. If the stringent criteria for TEA are accepted, wherein much fewer projects will qualify, then the General category will become the industry standard.
Migratesmart commits to keeping our stakeholders updated of all developments in this story.