CMB Calls for Increased Engagement with USCIS on New EB-5 Redeployment Policy ChangesJuly 28, 2020
The United States Citizenship and Immigration Services (USCIS) issued a Policy Alert entitled “Clarifying Guidance for Deployment of Capital in Employment-Based Fifth Preference (EB-5) Category,” dated July 24, 2020, which it claims provides clarifying guidance on redeployment of capital. Although the updates do provide some clarity, they go much further and provide new policy guidance which will be applied retroactively to all currently pending I-526 and I-829 petitions.
The policy highlights include:
- Clarification for the requirements of redeployment of capital in generally, which includes providing new language regarding the redeployment of capital through financial instruments that meet applicable requirements. This clarification also explains that the purchase of financial instruments on the secondary market will generally not satisfy the requirements.
- Clarification that capital may be further deployed into any commercial activity that is consistent with the purpose of the new commercial enterprise to engage in the ongoing conduct of lawful business. This clarification is meant to address potential confusion among stakeholders regarding prior language about the scope of the new commercial enterprise.
- Explicitly states that further deployment must occur through the same new commercial enterprise as the initial deployment. In the past policy guidance, this was merely implied.
- Changes past policy to provide that further redeployment must be within the geographic scope of the regional center (which may include amendments to the regional center’s geographic scope which were approved before the further deployment).
- Clarification that the reasonable timeframe for redeployment of capital should occur within 12 months. Although this clarification will be generally accepted, USCIS will consider evidence showing that a longer period was reasonable.
CMB Regional Centers, as the leading regional center in the EB-5 industry, has always strived to be in compliance with the USCIS’s redeployment policy as it previously outlined in its June 2017 policy memo, and we appreciate the efforts of USCIS in providing additional clarity on this important topic. However, much of what they have provided has been done without notice and comment from the EB-5 industry. Further, there are very important areas where the “clarification” did not serve to clarify, but rather has caused further questions, doubt and risk to EB-5 practitioners and participants. Finally, this guidance fails to fully consider the implications of retroactive application to the thousands of currently pending petitions that have made every effort to obey the letter and intent of the law to the finest detail.
CMB is now looking at the possible implications, if any, for our previous redeployments and we are working with various immigration attorneys and consultants to formulate a response to the USCIS. We look forward to, and anticipate establishing increased engagement with, USCIS so that the positive clarification of the “Guidance for Deployment” of EB-5 capital can be implemented. There is also a great need for discussion of the identifiable negative impacts caused by an abruptly changed policy that has taken place in an inappropriate manner.