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December 13 2018

EB-5 Regional Center Statute Has Been Extended

EB-5 Regional Center Statute Extension

Congress has extended the EB-5 Regional Center statute with the government budget resolution to December 21, 2018. Further extension is anticipated.

Federal Court Finds Borrowed Funds Are Ok For EB-5

In Zhang v. USCIS, a federal judge in the U.S. District Court for the District of Columbia ruled that USCIS’ narrow interpretation of the regulations on loan proceeds for EB-5 investment funds is illegal. USCIS denied two EB-5 cases where the investors borrowed funds from their own corporation using their stock or undistributed profits as collateral, and invested the borrowed funds in an EB-5 project. The loans had no separate collateral, such as the investor’s home. USCIS denied the I-526 petitions, claiming the investors did not use cash assets, but rather indebtedness for their EB-5 investment.

The court disagreed. The court found USCIS’ requirement that the investor must have personal collateral for the loan is illegal and contrary to the plain meaning of USCIS’ own regulations.