Today, I moderated a panel at the IIUSA 7th Annual EB-5 Industry Forum in Miami, FL titled “Prepared for the Long Haul: Understanding the Visa Backlog Today & Planning Ahead” with Mr. Charles Oppenheim, the Chief of the Immigrant Visa Control and Reporting within the U.S. Department of State (“DOS”).
Understanding the EB-5 visa backlog is critical for EB-5 investors, regional centers, and U.S. companies using EB-5 capital for job creation. Here are five things I learned from Charlie:
- Cutoff Date for Vietnamese EB-5 Investors. For the past three fiscal years, Vietnamese EB-5 visa usage ranked #2 behind mainland Chinese. Since Form I-526 processing times are approximately 21 months, the majority of the Form I-526 filings in FY2015 by Vietnamese could start using visa numbers right now. There are 672 EB-5 visa applicants currently registered at the NVC, and it is likely that Vietnam will reach its 7% per country cap in FY2018 (which started October 1, 2017 and ends September 30, 2018). Accordingly, Charlie expects a cutoff date for EB-5 visas to be introduced for Vietnamese investors in the summer of 2018. This will likely be the same cutoff date for mainland Chinese EB-5 investors. The critical difference between the two countries, however, is that demand from Vietnam isn’t so large, so that, when new visas become available from FY2019 (in October 2018), the cutoff date will be temporarily removed. Expect cutoff dates for Vietnamese EB-5 investors at the end of each fiscal year for the foreseeable future.
- Cutoff Date for Mainland Chinese EB-5 Investors. Charlie provided an update on the cutoff date for EB-5 investors, indicating that the December 2017 Visa Bulletin for Chinese EB-5 investors will be July 15, 2014. Charlie also indicated that the best case scenario for the mainland Chinese cutoff date for September of 2018 is October 1, 2014; the worst case would be September 1, 2014. Charlie also mentioned that the advancement of the cutoff date has slowed down due to larger number of “Rest of World” (ROW) visas and large weekly groupings of Chinese EB-5 visa demand. Expect slow movement on the Chinese EB-5 cutoff date in the next 12 months.
- Cutoff Date for Indian EB-5 Investors. Charlie reviewed I-526 filing statistics and noted large increases in I-526 petitions filed by Indian nationals in past couple of years. It is possible that India reaches to the 7% per country cap in FY2020 (October 2019), which would result in the creation of a cutoff date for EB-5 visas to Indian nationals. This is a key point that must be followed closely.
- Difficulty in Predicting Length of EB-5 Visa Waiting Line. Charlie indicated that predicting a solid waiting line is difficult to achieve because of many factors like (a) I-526 denials, which may increase with the current administration; (b) divorce rates during the waiting time; (c) deaths during the waiting time; and (d) dropouts of EB-5 investors who find other immigration solutions or simply fail to move forward with the visa process. Charlie mentioned this previously happened for family-based 4th preference (adult siblings).
- Number of Visas Per I-526 Application. Historical data shows that for each I-526 filed, there is an average of 2.838 visas issued (typically, one for investor, one for spouse, and one for child). Charlie indicated this was consistent with the numbers he uses when contemplating future visa usage. However, with more Vietnamese and Indian I-526 petitions filed, it will likely increase due to the larger size of families from those countries, compared to Chinese investors. On the other hand, it may decrease if Chinese minors become principal applicants due to the current visa backlog and “age-out” concerns. How many visas used per approved I-526 will affect the waiting line for all affected.