Investors Make Agreement with USCIS to End Suit Over EB-5 Reforms
September 26, 2022
A proposed settlement filed in California Federal Court shows that the United States Citizenship and Immigration Services (USCIS) reached an agreement with a group of investors. The USCIS and investors agreed to cancel its recent reforms to the EB-5 program to settle allegations made by regional centers. The centers alleged that the changes the USCIS made misinterpreted Congress’s intent.
The agreement allows previously approved Centers to keep their approval. However, they must file a renewal application by December 29. Centers include the filing fee to maintain their authorization. Additionally, the settlement permits EB-5 investors to file petitions with different types of proof instead of waiting for an official receipt from the USCIS.
The agreement will need to be approved. However, once approved, it will settle the two Administrative Procedure Act lawsuits filed earlier in the year by one of the regional centers and other operators. The lawsuits came about after the USCIS posted a notice on its website. The statement declared unilateral deauthorization of all EB-5 regional centers when Congress passed the EB-5 Reform and Integrity Act of 2022.
In June, U.S. District Judge, Vince Chhabria, ordered the USCIS to permit the 632 EB-5 regional centers to continue operating while litigation pended. The Judge clarified the deauthorization as a legal error from the USCIS.
Initially, a hearing to address a regional center’s motion would take place on August 18. This hearing would address a regional center’s motion for an order showing cause for civil contempt and for enforcing a preliminary injunction. Instead, Judge Chhabria granted a request made by the parties. The parties requested a continuance of the hearing to August 24, allowing them to continue negotiating for a settlement.
The negotiations resulted in the parties filing a stipulation of settlement. In addition to retaining authorization, an attorney revealed that the USCIS agreed to meet with the regional center quarterly for two years. This agreement intends to ensure the USCIS interprets the EB-5 Reform and Integrity Act of 2022 correctly.
Congress originally authorized the EB-5 regional centers in 1992. They allowed funds from investors participating in the EB-5 program to be pooled and used by these centers. Before the EB-5 Reform and Integrity Act of 2022, Congress had to extend the program regularly. However, with the new Act, the EB-5 Regional Center Program is authorized through September 30, 2027.
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