A new U.S. bill is proposing to eliminate the per-country cap for all employment-based green cards, including the EB-5 visa.
Currently, the EB-5 program has an annual quota of 10,000 visas with a per-country cap of around 700 visas.
If excess applications are received, then these are carried forward to the next year. The net result is that each future applicant faces the prospect of a longer waiting period for a US green card.
The proposed change removes the per-country cap and introduces a first-come-first-served setup. So, the investor who applies first will get their application processed irrespective of the country of origin.
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Implications for EB-5 Investors
Whether removal of per-country cap is a positive or not depends on the volume of green card applicants received from a country. If Indians account for 90 percent of all applications received, then the sheer weight of their numbers will mean they will receive the lion’s share of the green cards.
This is why this proposal is viewed as good news for Indian EB-1/EB-2/EB-3 applicants. They dominate these categories and removal of per-country cap will make more green cards available to them.
Unfortunately for Indian EB-5 investors, China has the biggest EB-5 backlog, which means absence of per-country cap is going to be a plus for Chinese EB-5 investors at the cost of investors from other countries.
China’s huge backlog is the result of surge in EB-5 applications filed between 2014 and 2017. Indian interest in the EB-5 visa increased post 2016-17 when the up to five year wait for the US green card seemed attractive compared to the 80-year wait under EB-2/EB-3 categories.
Impact on Indian EB-5 Investors
While the bill contains measures to prevent any visa program from being dominated by a single country, the net effect is that Indian EB-5 investors will face longer waiting periods.
The average four-year wait between filing of the I-586 petition to issue of the EB-5 visa is expected to double to more than eight years.
Increased waiting time is going to increase the risk of failed businesses and rejection of EB-5 petitions. EB-5 rules require applicants to keep their investments ‘at-risk’ until the end of the two-year period of conditional permanent residence.
If the proposed change becomes law, then Indians may have to keep their investments at risk for 10 to 12 years to qualify for the green card.
A longer waiting period also means the risk of a child aging out increases significantly. Children qualify as an investor’s dependent family member only if the child is aged less than 21 years old.
If the time period for an EB-5 visa is significantly longer than the adjudication period for the application, then applicants risk their children ‘aging out’, meaning they are disqualified from qualifying for the green card as a dependent family member.
This is a significant risk considering securing good education and career prospects for their children is the primary reason why Indian investors apply for the EB-5 visa.