The EB-5 industry needs to face a new reality: Investors born in mainland China who file I-526 petitions from now to the foreseeable future will have to wait at least six years before a visa number will be available for them to use an approved I-526 petition to actually immigrate to the United States. The higher the number of I-526 petitions that exceeds the visa supply, the longer the wait will get.
This is an important statement. I first explain how I arrived at this conclusion and then explain some important implications of it.
How the Visa Allocation System Works for EB-5
Currently, approximately 10,000 EB-5 immigrant visas are allocated annually, on a fiscal year beginning October 1, to alien investors and their spouses and qualifying children. EB-5 visa numbers are allocated in the order in which the investor filed the I-526, so the I-526 filing date is the “priority date” for the investor. When allocating EB-5 immigrant visas, U.S. law limits each country to an aggregate maximum of 7% of the total number of EB-5 immigrant visas available each fiscal year. Until FY2015, the annual quota was not reached, and applicants born in mainland China have tended to use approximately 85% of the numbers. (See Report of the Visa Office 2015, Table IV Part 4, reflecting that mainland China born accounted for 7,616 of the total 8,773 EB-5 visa numbers issued). If the annual worldwide quota is likely to be reached in a fiscal year, the State Department imposes a “cut-off date” for applicants born in a country that appears likely to exceed the 7% per country limit to restrict visa numbers to such applicants to the 7% limit, plus any additional numbers that will not be used by applicants born in all other countries combined. (If visa demand from applicants from countries not using the 7% limit were likely on a combined basis to exceed the worldwide limit, the State Department would impose a worldwide “cut-off date,” but that has not been the case for EB-5, given the heavy predominance by mainland China and the lack of demand from elsewhere).