The
Retrogression
Confronting the Challenges
of a Chinese Visa Backlog
in 2015 and Beyond
by David Hirson and Cletus M. Weber
The inevitable visa backlog for China-born
EB-5 investors and their family members has
been rumored for some time, but concerns
finally became reality when Charles Oppenheim
of the U.S. Department of State (DOS) recently
predicted that, around June 2015, the DOS
will need to impose an initial two-year visa
backlog for EB-5 investors born in mainland
China. Also, as described in more detail below,
Oppenheim further predicted that this waiting
line for Chinese EB-5 investors will continue
to grow in years to come. This article explains
the visa backlog problem and how it will affect
EB-5 investors, EB-5 regional centers, project
developers and the EB-5 industry on the whole,
as Chinese investors adjust to the new delays in
visa processing and/or U.S. law is changed. The
accompanying articles explain calculating child
“age out” issues under the related Child Status
Protection Act (CSPA), and provide guidance
on strategies for practitioners working with
mainland China-born EB-5 investors.
44
U.S. visa allocation system
The U.S. visa allocation system is complex and technical,
but simply put, 10,000 visas are allocated annually for the
EB-5 category and applicants from all countries are treated
equally until it appears that the entire annual allocation will
be used up during a particular fiscal year. When that happens,
applicants from over-subscribing countries (technically speaking, countries that use more than 7 percent of the worldwide
total) must wait for a future year’s allocation to be available
before they can obtain a green card. This allows applicants
from other countries to apply for and obtain green cards without additional delay. Until the past fiscal year, worldwide EB-5
visa demand never required a cap on any one country’s visa
usage, but visa usage in the current fiscal year, and foreseeable
fiscal years, is expected to continually reach 10,000. Because
investors from mainland China use so many EB-5 visas, they
will face a growing backlog in waiting to obtain a green card.
In overseeing the EB-5 visa allocation system, the DOS
must use (or reallocate to other visa categories through
technical rules) all 10,000 visas—but never more than that.
To decide which applicants can obtain green cards in what
order, the DOS establishes a queue by assigning each investor
a “priority date,” which is the date that U.S. Citizenship and
Immigration Services (USCIS) receives the investor’s I-526
petition. Once the DOS establishes a cut-off date in the EB-5
category, only investors with approved I-526 cases and priority dates before the cut-off date are eligible to proceed with
consular processing (CP) or adjustment of status (AOS). As
predicted for the 2015 fiscal year, China is the only country
that will be subject to delays while waiting for visa numbers.
Investors from all other countries can continue to process
without additional delay.
EB5 INVESTORS MAGAZINE