Earlier today, USCIS issued a policy alert clarifying policy guidance in the USCIS Policy Manual regarding redeployment of investment capital, including further deployment after the job creation requirement is satisfied. The updated guidance is now available online in Volume 6, Part G of the USCIS Policy Manual.
Policy Highlights Include:
- Clarifies requirements for deployment of capital generally, including providing new language regarding the deployment of capital through any financial instrument that meets applicable requirements1 as well as explaining how the purchase of financial instruments on the secondary market will generally not satisfy such requirements.
- Clarifies that capital may be further deployed into any commercial activity that is consistent with the purpose of the new commercial enterprise to engage in the ongoing conduct of lawful 1 This clarification supersedes prior language discussing new issue municipal bonds as a specific type of potentially permissible financial instrument in the context of further deployment. n business. This clarification is meant to address potential confusion among stakeholders regarding prior language about the “scope” of the new commercial enterprise while remaining consistent with applicable eligibility requirements.
- Provides that further deployment must be through the same new commercial enterprise
- Provides that further deployment must be within the geographic area of the same regional center, including any amendments to the regional center’s geographic area approved before the further deployment.
- Explains that, based on an internal review and analysis of typical EB-5 capital deployment structures, USCIS generally considers 12 months as a reasonable amount of time to further deploy capital, but will consider evidence showing that a longer period was reasonable.
IIUSA Member Perspective: After Years of Waiting, USCIS Finally Clarifies EB-5 Redeployment Requirements
by Dan Lundy, Klasko Immigration Law Partners, LLP
On July 24, 2020, USCIS issued updates to the Policy Manual clarifying requirements for the redeployment of EB-5 investment capital. Although the clarification is welcome, it is several years late. Investors, regional centers, and project developers have been asking USCIS for guidance for years, and have been redeploying EB-5 capital to the best of their ability in the absence of guidance. Unlike USCIS guidance on several other issues, this new guidance does not specify that it applies only to redeployments on or after the date of publication. This means the possibility of retroactive application is strong.
The updated guidance provides that EB-5 capital may be redeployed through the original New Commercial Enterprise (NCE), the entity that the investors originally invested in, within the territory of the regional center, as long as it is redeployed “in commerce,” and consistent with the NCE’s ongoing purpose of conducting lawful business activity. Redeployment does not have to be within a TEA, even if the original investment was in a TEA. Further, USCIS considers one year as a reasonable time to redeploy the capital…Continue Reading