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How can Chinese investors maintain the "at risk" status of the funds without having to reinvest?

I am an EB-5 investor with an approved I-526. Because of the visa backlog issue, I might get my investment fund back before the filing of I-485 or DS-260. However, with the uncertainty of the redeployment situation, I am not willing to put my funds in another project. I understand that to keep my eligibility for EB-5, the investment funds must be kept “at risk”. Is there a way to keep the EB-5 fund “at risk” without investing it in another project?

Answers

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    Investors in your situation must redeploy their capital within a commercially reasonable time consistent with the new commercial enterprise''s industry scope in order to be considered at-risk. The investment need not involve the same degree of risk and in fact can be investing into municipal bonds, but not into treasuries, and the municipal bonds should be in a similar type of project, such as an infrastructure project.

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    BoBi Ahn

    Immigration Attorney
    Answered on

    There isn't a statutory requirement that the redeployment of funds be in a similar or equal risk project as the initial investment for the I-526 filing, as long as it is invested in a commercial enterprise with no guarantees of return.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    For EB-5 investors facing visa retrogression, such as China mainland-born nationals, you have to sustain funds at-risk until you become a conditional permanent resident and during the two-year conditional residency period up to until you file I-829. To sustain the at-risk requirement, you either redeploy funds with the regional center project in another at-risk investment consistent with its ongoing business operation or in certain new issue municipal bonds if such bonds are within the project's scope at the time you filed I-526 petition. If you do not redeploy funds, your risk jeopardizing your ability to become a permanent resident. Check with your regional center project regarding its redeployment strategy.

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    Barbara Suri

    Immigration Attorney
    Answered on

    From my research, it appears that redeployment is not required for EB-5 investors to sustain their "at-risk" investment for I-829 approval. The regulations require the investment to be "at-risk" to qualify for I-526 approval; but this does not seem to be a requirement for I-829 approval. But until there is a clear answer, it may be best to leave the investment in place.

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    Charles Foster

    Immigration Attorney
    Answered on

    If you're a Chinese national with an approved I-526 petition and you cannot obtain your immigrant visa or adjust due to a lack of visa numbers, you must maintain your investment "at-risk" up until the time you have obtained your conditional permanent resident, and for an additional two-year period when you're required to file your petition on Form I-829 to remove conditions. If you do not re-deploy funds, you could jeopardize your eligibility to become a lawful permanent resident of the U.S. The only way to keep your EB-5 funds "at risk" is to work with the project developer and the regional center so that your funds can be safely re-deployed.

  • Avatar

    Marko Issever

    EB-5 Broker Dealer
    Answered on

    This is a highly debated issue and frankly, the practice that is required to be followed in this case does not seem to be clear at all. Most likely, you will be fine if the regional center does not return your funds but keeps them in the NCE. That used to be enough to deem your funds "at-risk." Lately, they are being asked to reinvest the funds into another project. The project they reinvest your funds in though does not need to be an EB-5 project. Your immigration attorney should read your subscription documents and then have a conversation with the principals controlling the NCE. On the one hand, they might agree to let your funds sit idle at the NCE level once the JCE pays the loan.This will protect you from the deployment risk you are afraid of. On the other hand, if they do not reinvest your funds on another project and keep them essentially at escrow ready to be disbursed to you at the end of your conditional green card period, that could take a very long time and USCIS could then deem that your funds that were waiting idle at escrow for you were not "at-risk." As you can see, this is a gray area for which you definitely need sound attorney advice.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    Once the job creation requirement has been met, the capital is properly at-risk if it is used in a manner related to engagement in commerce (in other words, the exchange of goods or services) consistent with the scope of the new commercial enterprise's ongoing business. After the job-creation requirement is met, the following at-risk requirements apply. The immigrant investor must have placed the required amount of capital at-risk for the purpose of generating a return on the capital placed at-risk. There must be a risk of loss and a chance for gain and business activity must actually be undertaken. In conclusion, an investor must maintain his or her EB-5 investment during his or her "sustainment period," which is the two-year period of the investor's conditional residency. For investors impacted by retrogression or other delays (such as Chinese investors) in obtaining conditional residency, at the time of loan repayment, USCIS requires them to further redeploy their capital within a "commercially reasonable time" into some at-risk investment in a manner which is consistent with the new commercial enterprise's ongoing business operations. USCIS does not require that the redeployed investment involve the same degree of risk, as the original job-creating enterprise contemplated in the investor's I-526 petition to be deemed sufficiently "at-risk" for the sustainment period. It appears there are several conservative redeployment vehicles and reinvestment options that are USCIS-compliant, including new issue municipal bonds. Treasuries may not be considered at-risk. USCIS confirmed that certain new issue municipal bonds, such as for infrastructure spending, can be at-risk as long as investments into such bonds are within the scope of the NCE in existence at the time investor filed I-526.

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    Phuong Le

    Immigration Attorney
    Answered on

    Long story short, if your current EB-5 loan term allows you to keep the funds within the same project (unlikely, but possible if EB-5 is actually cheaper than any other financing they can get to replace it), then no redeployment is needed.

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    Abhinav Lohia

    Immigration Attorney
    Answered on

    It is not mandatory for the funds to be deployed in another EB-5 project. Per USCIS guidelines, funds can also be invested in certain new issue municipal bonds to meet the "at-risk" requirement. Make sure the attorney you are working with reviews the project documents to figure out what re-deployment strategy will be followed by the new commercial enterprise.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    If it stays in the NCE, it may be considered at-risk.

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