Navigating The Recent Legal Battles Over EB-5 Visa Guidelines and Fee Increases

By Ronald Fieldstone 

Two noteworthy litigation cases related to the EB-5 visa program are pending, creating uncertainty about their potential implications for this U.S. residency pathway. 

First, is the case brought by Invest In the USA (IIUSA) against United States Citizenship and Immigration Services (USCIS) relating to the definition of “sustainment period”, where IIUSA claims that USCIS’s October 11, 2023, Policy Release was invalid since it constituted a modification to the pre-RIA Regulations that were not changed as a result of the EB-5 Reform and Integrity Act of 2022 (RIA).   

The second case is less controversial, as it involves the appropriateness of USCIS unilaterally increasing EB-5 filing fees in their January 2024 Policy Release without appropriate justification.  

WHAT IS THE NEW USCIS GUIDANCE REGARDING THE SUSTAINMENT PERIOD? 

On October 11, 2023, USCIS issued a Policy Release that confirmed the “sustainment period” means the two years for the sustainment of an investor’s EB-5 investment. In particular, the Policy Release stated that USCIS clarified that EB-5 investors filing I-526 or I-526E petitions after the RIA no longer need to keep their investment sustained through their full period of conditional residence. Instead, the RIA requires only that the investment be expected to remain invested for at least two years. USCIS interprets this two-year period to begin when the full qualifying capital is contributed to the new commercial enterprise and placed at risk for job creation. 

In July 2025, following oral arguments regarding the definition of “sustainment period”, a judge in the Federal District Court of Washington, D.C. ruled in favor of the plaintiff and confirmed that the Policy Release violated the law since the defendant failed to file new regulations to modify existing rules. However, because of a joint stipulation between the parties, the Judge provided USCIS until November 2025 to publish new Regulations.   

Based upon the above, it is unclear if USCIS will publish rules and regulations in the required timeframe. In fact, USCIS did not publish new regulations as required. There is no assurance that the agency will publish regulations that are first acceptable and not otherwise modified by either legislation or place pressure on USCIS to conform to a different standard, and whether they will adopt the October 11, 2023, Updated Policy Release.  In addition, there is no assurance as to the extent to which there will be retroactive leeway for those EB-5 investors who supposedly relied upon the October 11, 2023, Policy Release, so that such petitioners are not prejudiced to the extent that they have already advanced funds and are expecting a return of funds in a timely manner.   

As a result, USCIS’s definition of “sustainment period” to mean the two years for the sustainment of an applicant’s EB-5 investment remains subject to further interpretation or modification. The same shall be determined by the agency from time to time, and subject to litigation against USCIS challenging the position concerning its application of the definition. 

THE FILING FEES INCREASE 

In the second case brought in by the U.S. District Court in the Northern District of Texas, several Regional Centers and IIUSA sued to void USCIS’s unilateral increase of EB-5 filing fees. 

As background, on or about January 3, 2023, USCIS announced that filing fees for the EB-5 Program will be subject to an increase, becoming effective as of April 1, 2024. In particular, the filing fees for a Form I-956, Application for Regional Center Designation, and Form I-956F, Application for Approval of an Investment in a Commercial Enterprise, increased from $17,795 to $47,695 (i.e., a 168% increase). Correspondingly, the filing fee required to be paid by each EB-5 investor for a (i) Form I-526E petition increased from $3,675 to $11,160 (a 204% increase); and (ii) Form I-829 petition increased from $3,750 to $9,525 (a 154% rise). Notably, the $1,000 fee paid by each EB-5 investor to the EB-5 Integrity Fund remains unchanged.  

In November of 2025 the Federal District Court in Colorado ruled that the increase in the filing fees violated the RIA. Immediately thereafter, USCIS announced that it would accept the lower filing fees. The Court did not address the refund of the increased filing fees paid subsequent to April 1, 2024. 

Based upon the ruling in the Colorado case, the senior Judge in the Texas case may be more inclined to rule more quickly. The plaintiff in this case requested a refund of the increased filing fees that were paid.  

OVERVIEW OF CERTAIN IMMIGRATION ISSUES  

There is no certainty whether USCIS will attempt to adopt regulations consistent with its Policy Release. The current Policy Release creates confusion as to  

1. Each EB-5 investor’s two-year mark and when the required jobs have been created 

2. Whether each EB-5 investor’s two-year time needs to be separately tracked to determine when the two years begin. 

For example, (A) how do we treat the typical scenario of New Commercial Enterprise (NCE) accumulating partial EB-5 funds from 5 investors and advancing the same to the Job Creating Entity (JCE) as part of the EB-5 financing; and (B) what if there are multiple EB-5 investors whose EB-5 funds are advanced by the NCE to the JCE periodically?  

Ultimately, the tracking and accounting of job creation for EB-5 investors will be very complicated. In addition, there is uncertainty as to whether all EB-5 investors are retroactively grandfathered under the RIA based upon the above analysis.  

WHAT ARE THE SECURITIES LAWS AND CORPORATE IMPLICATIONS? 

Including appropriate disclosures in EB-5 offering and related corporate documents regarding the foregoing issues until these cases have been finally decided is critical, particularly with respect to addressing the uncertainty regarding the definition of “sustainment period”.  

The following are just a few recommendations regarding how to appropriately address these issues: 

• Disclose the status of the case and provide language as to the uncertainty that has been created because of the same. 

• Need to address risk factor with EB-5 investors concerning any repayment of their capital contributions prior to meeting the pre-RIA “sustainment period,” given the uncertainties set forth above.  

From a corporate standpoint, the NCE’s operating agreement or partnership agreement should provide its Manager/GP with authority to decide when EB-5 investors may receive a return of their capital contributions to comply with the “at risk” requirements under the EB-5 Program, which, in turn, will be based upon the ultimate determination of when their respective “sustainment periods” begin.  

The applicable EB-5 loans, or preferred equity documents, should also appropriately address these uncertainties in connection with the loan term, the preferred investment exit strategies, and the necessity of reflecting matters related to the sustainment period. Notably, EB-5 offering documents today typically have a shorter term for repayment of EB-5 capital to the NCE with extension rights, to accommodate the needs of the EB-5 industry (e.g., a three-year term with three one-year extension options).  

Specific EB-5 projects involving the sale of condominiums or residential units provide the advantage of allowing for an ordinary liquidation of assets to easily accommodate the foregoing shorter-term model, where each EB-5 investor’s time frame will be different, as compared to a lump-sum payment upon the sale or refinancing of other projects. Typically, a three-year term is realistic if the EB-5 project is shovel-ready and/or under construction.  

OTHER LITIGATION AND COMPLIANCE ISSUES 

There are no clear guidelines on who exactly needs to file the Form I-956K, Registration for Direct and Third-Party Promoters, or the Form I-956H, Bona Fides of Persons Involved with Regional Center Program. So there is uncertainty regarding whether they are mutually exclusive. This doubt in the EB-5 industry is further problematic where many sponsors want to limit what principals related to their NCEs and EB-5 projects need to be disclosed. 

Such disclosures are relevant where they affect the information provided on NCE and Regional Center’s websites, as well as the documents that are contained in the Form I-956F that is filed with USCIS for each EB-5 offering. 

Sponsors are taking greater care in limiting their EB-5 investors’ access to the NCE’s EB-5 members and limiting their ability to bring class action claims. Additionally, sponsors need to consider whether to require arbitration for any dispute resolution matters. In any event, sponsors must still ensure there are adequate EB-5 investor protections in their EB-5 offering, corporate, and loan documents.  

Additionally, sponsors should address in their EB-5 offering, corporate, and loan documents the parties responsible for a claim based upon violations of U.S. securities laws, and allocate risk between the NCE and JCE/borrower to take into account the JCE/borrower only being responsible for the project-related information included in such documents.    

Consideration should also be given to including appropriate regional center-related disclosures to the extent that the regional center’s exposure should be limited to its duties as the sponsor of the EB-5 project under the regional center sponsorship agreement and the EB-5 Program. A primary consideration must be to ensure clear and appropriate disclosure of conflicts of interest where the NCE and JCE are affiliated, whether directly or indirectly, as well as, in certain cases, minimizing or otherwise addressing any such conflicts of interest. For example, engaging an independent EB-5 loan administrator and/or fund manager to administer and enforce the EB-5 loan. Notably, such actions often make an EB-5 offering more marketable to prospective EB-5 investors as they recognize the further protection their investment is given, notwithstanding the conflict of interest that is or may be present. 

Also, consider when any of the applicable EB-5 offering, corporate, or loan documents need to be modified from time to time to take into account any of the above issues or following any event that could be deemed a material adverse change to the EB-5 investment from an immigration and/or U.S. securities laws compliance standpoint. 

Regarding bridge financing that is ultimately replaced by EB-5 capital, USCIS has taken inconsistent positions on the look-back period related to any bridge debt and equity funding and the need to create jobs prospectively. For example, there is uncertainty regarding an EB-5 investor’s immigration status in the case where the EB-5 project has been substantially completed and most of the jobs have already been created; query whether this prejudices the last EB-5 investors who invest in the NCE for such an EB-5 project.  

USCIS has, more recently, taken the position that an EB-5 project cannot rely on EB-5 funding to complete. Still, that evidence must be shown of the ability of the JCE to ultimately obtain the other sources of funding required in the capital stack, such as a senior loan commitment and/or proof of developer availability. 

EB-5 PROFESSIONALS MUST MITIGATE RISKS UNTIL THESE CASES ARE RESOLVED 

All professionals involved in preparing the EB-5 package have a responsibility to take reasonable care in providing clear information about the risks regarding making an EB-5 investment. 

Given the great uncertainty surrounding many EB-5-related requirements, they must create a financing structure, and a detailed EB-5 package. 

This effort will minimize the sponsor’s risk exposure from an immigration, U.S. securities laws and corporate/fiduciary compliance standpoint.  

Hopefully, these moving targets will be narrowed in the future.  

DISCLAIMER: The views expressed in this article are solely the views of the author and do not necessarily represent the views of the publisher, its employees. or its affiliates. The information found on this website is intended to be general information; it is not legal or financial advice. Specific legal or financial advice can only be given by a licensed professional with full knowledge of all the facts and circumstances of your particular situation. You should seek consultation with legal, immigration, and financial experts prior to participating in the EB-5 program Posting a question on this website does not create an attorney-client relationship. All questions you post will be available to the public; do not include confidential information in your question.