The ongoing legal case between regional center trade association Invest in the USA (IIUSA) and U.S. Citizenship and Immigration Services (USCIS) over the EB-5 visa program sustainment period raises significant questions and concerns regarding what will happen to this key time required for EB-5 investments.
The sustainment period is when foreign investors applying for an EB-5 visa must maintain their investments in a U.S. commercial enterprise to qualify for permanent residency. During that period, the enterprise must create or preserve jobs for U.S. workers. It is critical to the EB-5 application process because it ensures that the investment meets the visa program’s job creation and economic development goals.
Today, the sustainment period is two years after the money is invested in the EB-5 project. The USCIS says the two years meet the EB-5 Reform and Integrity Act of 2022 (RIA). But IIUSA says the agency’s interpretation violates federal law and industry practices and that the 2-year sustainment period harms current and future EB-5 deal-making.
In February, the lawsuit progressed with additional arguments presented before the U.S. court overseeing the case, with the IIUSA and USCIS requesting more time to submit their positions.
Why did the IIUSA sue the USCIS over the EB-5 sustainment period?
The lawsuit focuses on the regulatory framework governing the EB-5 sustainment period. IIUSA requests that USCIS repeal the existing 2-year sustainment period regulation and wants the U.S. immigration agency to establish a 5-year sustainment period, claiming that it is reasonable, consistent with precedent, and responsive to key reliance interests shared by all EB-5 investors and stakeholders.
It all started in October 2023 when the USCIS issued a Policy Manual guidance establishing a 2-year sustainment period for EB-5 investors who filed for an EB-5 visa before or after Mar. 15, 2022. In that update, the USCIS said that the start date of the sustainment period is when the EB-5 visa investment is contributed to the new commercial enterprise [NCE] and placed at risk per applicable requirements, including being made available to the job-creating entity. USCIS argues that this time frame complies with RIA requirements.
In March 2024, IIUSA sued the DHS and USCIS in the U.S. District Court for the District of Columbia over this interpretation, arguing that the U.S. immigration agency is violating the Federal Administrative Procedures Act (FAPA) and other federal law by implementing the two-year framework. In November that year, a D.C. judge in charge of the case required more evidence for both arguments and ordered the parties to file a Joint Status Report by Feb. 27, 2025.
Joint status report: IIUSA wants a fixed timeframe and USCIS cautions against strict regulation
The IIUSA proposes revising the sustainment period regulation, arguing that the current two-year period has become burdensome for investors and complicates investment. The association also advocates for a new sustainment rule defining specific years for the sustainment period. They believe this change would better reflect the intent of Congress and the RIA.
Meanwhile, the U.S. immigration agency takes a more cautious approach. They say they consider the matter a regulatory priority, but the new leadership must thoroughly review the proposed regulations and pending litigation. They expressed concerns regarding the specific timeline proposed by IIUSA. They prefer to keep the possibility of rulemaking about the sustainment period open-ended. They argue that rushing the process could lead to inadequate policy changes that do not fully consider the complexities of the EB-5 program.
The U.S. agency also requested a 30-day extension to provide another status update, while IIUSA proposed a 14-day timeline to encourage a more expedited resolution.
How is the lawsuit impacting EB-5 stability?
The lawsuit addresses the legal interpretation of the sustainment period established by the RIA and the practical implications of how USCIS applies and regulates this period in its policies. As it continues to unfold, EB-5 investors remain uncertain, hoping for a resolution that balances their interests with legal requirements.
However, if the final ruling involves changes to regulations governing the sustainment period, it could significantly impact EB-5 investments and the businesses they support.
According to EB-5 attorney Vivian Zhu, the lawsuit “has significant implications for the stability and attractiveness of the EB-5 program.”
For U.S. immigration attorney Oliver Yang, “the current legal uncertainty has placed many prospective investors in a difficult position, as they are unsure whether the projects they intend to invest in will ultimately comply with the new regulations once the case is resolved.”
EB-5 lawyer Tony Wong agrees with the agency’s interpretation of the two years, “however, USCIS failed to comply with the Federal Administrative Procedures Act (FAPA) as asserted in the IIUSA’s lawsuit.”
How could reverting the current time frame to pre-RIA status or to 5 years impact EB-5 applications?
During a legal brief providing information and guidance to the court regarding the lawsuit, the American Immigrant Investor Alliance (AIIA) cautioned that, depending on how the case evolves, “sustainment periods could revert to pre-RIA rules, forcing redeployment of capital for years and compounding uncertainty amid visa backlogs.”
EB-5 attorneys explain the implications of reversing to a pre-RIA sustainment period and the five-year timeframe defended by IIUSA, mainly impacting the program’s competitiveness and investor confidence.
“A longer sustainment period may deter new investors,” Zhu says, “as it increases financial risk, particularly in projects with limited liquidity. For those who have already planned around a two-year sustainment period, a reversal could require significant adjustments to their financial expectations. Investors nearing the end of their sustainment period may experience delays in capital redeployment or retrieval, impacting their ability to reinvest or access funds. The EB-5 program has already been subject to shifting policies and evolving adjudication standards, contributing to investor uncertainty.”
She adds that “if IIUSA’s lawsuit results in an extended investment timeline, it could introduce new risks, complicate liquidity planning, and diminish the program’s overall appeal.”
For EB-5 attorney Dennis Tristani, reverting requires capital redeployment to manage risks. “This is specifically due to upcoming visa waitlists in the [High Unemployment] HUA and rural categories (most likely for Indian and Chinese investors), which will significantly delay the issuance of investors’ conditional green cards. In this scenario, the length of the visa waitlist is essentially added on to the required sustainment period, in addition to the two years of conditional residency. This was a normal occurrence for pre-RIA investors from China and India.”
Wong expects more lawsuits against USCIS if a reversion or a 5-year period occurs. “It will cause more lawsuits to be filed by investors against not only USCIS, but also regional centers if RCs follow the court’s rule to return the capital. For potential investors, they will face higher risk when backlog happens, and RCs redeploy their capital during the extended period. I think they may hesitate to join EB-5 program because the risk under the extended sustainment period will be higher.”
He adds that the 5-year sustainment period has “no ground” under the RIA.
Regarding the joint status report, Yang says that despite the parties not settling by the original deadline, “I remain hopeful that a reasonable settlement will be reached which will be critical in providing assurance to future investors, especially during this tumultuous time.”
Yang also states: “Reverting to the pre-RIA definition would be untenable for most investors, given the years of disruption caused by the redeployment requirements, despite a clearer set of rules under RIA. A modification of the sustainment period to five years is likely to be broadly acceptable. However, the most critical factor is the prompt issuance of clear guidance that provides investors with confidence and stability in their green card journey.”
U.S. immigration attorney Rakesh Patel also expects that after the 30-day extension the USCIS and IIUSA come to a resolution “that is in the best interest of the investors and not just regional centers. A clear, quick resolution makes the most sense to me and neither party has indicated that is what they want, unfortunately. The industry suffers when outside forces attempt to make changes with no real end in sight. As I talk to investors on a daily basis, this has only causes confusion and fear among them and I am not sure that is the outcome either party needs as we move forward.”
Patel concludes: “If the sustainment period is changed to 5 years, we are concerned with how current investors under the 2-year rule would be affected,” he said. “There could be a situation where new redeployment language needs to be added to deals. The current post-RIA investors could face a longer hold than originally thought. We would also be concerned about how USCIS will apply the old regulation. Would this be tied to visa availability, or USCIS processing times? Those are all worries we have.”
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