A huge backlog of Chinese applications means years-long processing times are forcing candidates to look elsewhere towards other investment programs.
With education for their children top of the list of motivations for high net worth Chinese moving around the world, the standard of schools in Canada, the UK and Australia could be a key factor in drawing investment visa candidates their way.
That’s not to say uncertainty created by the policies of Trump on immigration are helping, but experts do not believe the U.S. president is about to scrap the lucrative EB-5 program.
Several Trump projects were funded by investment from the program before he became president.
He is yet to make clear his position on the visa, while at the same time beginning a complete overhaul of USA immigration policy.
Uncertainty is one of the chief issues at the moment, as well as changes that might be made to the program, which is under the latest of a series of temporary extensions, expiring on April 28.
Current US EB-5 Investment Requirements
- An EB-5 investor must invest in a new commercial enterprise.
- The investor must invest at least $1 million when investing in a general area of business or at least $500,000 when investing in a targeted employment area (“Regional Centres”).
- Within two years of admission as a Conditional Permanent Resident, the investor must create or preserve at least 10 full-time, direct or indirect jobs belonging to qualified US workers.
- See Tax Implications of Gaining Permanent Residence Through US EB-5 Visa.
There have been calls for the investment threshold to increase, with separate proposals suggesting $800,000 and $1.3 million respectively as the minimum requirement, but nothing has gained significant traction.
It has faced criticism from several sources, who want it abolished. There are several ongoing court cases linked to potential EB-5 fraud. There are calls for a body to be formed to oversee these transactions, to ensure transparency.
Fraud Cases Linked to EB-5
- The developer behind a biomedical research facility in Vermont, which benefitted from EB-5 funding, is currently being investigated for misusing the money. The project had attracted $83 million of investment from 166 foreigners, many of them Chinese, who now risk losing their money. Developer Ariel Quiros, and several of his associates, stand accused of using the funding to buy a ski resort, a luxury New York condo and to pay tax bills.
- Developer Lobsang Dargey was accused of defrauding Chinese investors out of money for a tower in Belltown. Dargey no longer has control of the project and denies any wrongdoing.
- American Life, a recipient of more than $1 billion in EB-5 investment money, was fined $1.2 million for facilitating payments to unlicensed intermediaries in the U.S.
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