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Apr 2, 2019

EB-5 Visa Demand Slows in Early 2019; Launching Vietnam Forward and Calling Into Question Whether India Retrogression Will Take Effect This Fiscal Year

Matthew Galati

Last fall, we covered perhaps the most important EB-5 development of the year, DOS’ Chief of the Visa Control and Reporting Division Charles “Charlie” Oppenheim’s projections for various countries’ EB-5 visa backlog times, based on an October 2018 filing. Of particular note were longer than expected wait times for Mainland China and Vietnam, and a warning to the industry to brace for India’s backlog to begin “no later than July 2019.”

However, more recent data calls these projections into question. As per the April Visa Bulletin,“Final Action Date movement in many Family-sponsored and Employment-based preference categories continues to be greater than might ordinarily be expected, and this is anticipated to continue for at least the next few months. This is a direct result of fewer applicants proceeding to final action on their cases at consular posts abroad and USCIS Offices.”

Further, each month, the American Immigration lawyers Association (AILA) publishes a “Check-in with DOS’s Charlie Oppenheim” (paywalled) that is “designed to keep members informed of Visa Bulletin progress and to obtain his analysis of current trends and future projections, beyond the basic visa availability updates provided in the monthly Visa Bulletin.” The latest edition had vitally important information for EB-5 applicants from high demand countries:

EB-5:

In the April 2019 Visa Bulletin, the Final Action Date for EB-5 China advances one week to September 15, 2014. In China, the Consulate in Guangzhou is trying to get scheduling up to speed following the recent periods in which the EB-5 I5 and R5 programs were not authorized.

A decrease in the level of expected demand is occurring for other countries as well. It is possible that applicants held off submitting documents while awaiting the reauthorization of EB-5 (I5 and R5) programs. Charlie expects the demand levels to increase again, as a result of the recent reauthorization. Charlie mentioned that EB-5 Vietnam has slightly less demand in the weekly groupings and is better positioned to advance. The Final Action Date included in the April 2019 Visa Bulletin for EB-5 Vietnam is August 22, 2016.

Charlie previously expected EB-5 India to reach its per country limit by July 2019. However, he is no longer certain that will happen. He is watching the demand data and should have a better sense of the number usage within a few weeks. The decline in demand mentioned above, possibly resulting from reauthorization concerns, makes it difficult for Charlie to estimate how many additional numbers may be used by "high demand" EB-5 countries.

This presents a puzzle for stakeholders. Form I-526 petitions and the number of prospective immigrants in the visa queue continue to be robust. What could be causing this immigrant visa slowdown, and perhaps the delay of the onset of Indian EB-5 retrogression until the next fiscal year?

We have one theory. Since the Regional Center Program’s expiration in December and the ensuing government shutdown, combined with short-term reauthorizations, the Visa Bulletins for three months (January, February, and March) have stated that the EB-5 Regional Center category visas (I5/R5) were unavailable, notwithstanding multiple legislative extensions. Our firm (and anecdotally several of our peers in the industry) have had administrative difficulties in moving cases through the National Visa Center. Citing the then-current Visa Bulletin, many of its employees claimed I5/R5 visas were not available notwithstanding legislative reauthorization. Only a few of our clients were able to successfully process their immigrant visas during that time.

The April Visa Bulletin indicates that the category is reauthorized and, accordingly, we are already seeing cases moving forward in the normal course. Our theory is that EB-5 visa demand has NOT subsided; but merely that processing the cases had slowed down. It remains to be seen whether the consulates will “catch up” over the remainder of the fiscal year, which ends on September 30.

No one knows for certain how long backlog times will be as family sizes change over time and many cases are denied / withdrawn/ revoked. We would continue to advise our India-chargeable clients to brace for retrogression, although perhaps its onset may be delayed for several months.

None of these developments profoundly affect other worldwide chargeable investors (e.g. Canada, the U.K.) Contact us today for more information relating to EB-5 and whether it is an appropriate solution for your family’s U.S. immigration needs.

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