EB5 Pilot Program was enacted in 1992 to allow foreign investment in a pre-approved US companies (so called regional center). Since the start, the program has to be reauthorized every 2-3 years depending on its previous version. The current EB5 pilot program is to sunset on Sept. 30, 2015.
June 3, 2015, A bill intended to extend, modify and reform the EB5 program was introduced and referred to Committee. Among all the modifications this bill is proposing, the followings are worthy of great attention:
- Current minimum investment for Non-TEA areas is $1 million, the bill, if signed into law, will change it to be $1.2 million, whereas minimum investment for TEA areas is currently $500,000, ( almost all EB5 investors receive their green card after “investing” this amount, ), the amount will be changed to $800,000.
2) Gifts of funds to the investor will be limited to those from immediate family members, siblings and grandparents.
3. Those pre-approved US companies (“Regional Centers”) will have to pay an annual ‘EB5 Integrity fee’ of $20,000, which means the US companies might pass on the fee to each investors in some way.
Will the reform actually happen? Will the investment amount increase? It is hard to say as all other bills born and died on the Congress’s floor. There is certain support from influential people though. Bill Gates and Warren Buffet, for instance, are one of them, especially when Congress sits down to review actual cases, they will find lots of fraud in this area and increase is necessary to assure the purpose of this program not to be frustrated.
We will keep watching. You are more than welcome to contact us for your thoughts or more related information.