EB-5 Case Challenging USCIS Interpretation De-Authorizing Regional Centers After Passage of EB-5 Reform and Integrity Act of 2022 Is Settled
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The EB-5 Reform and Integrity Act (RIA) was passed on March 11, 2022. USCIS then posted an interpretation of the legislation that would nullify all 600-plus designated regional centers and require all entities to be re-designated in order to be authorized to file petitions under the new law pursuant to provisions effective May 14, 2022. This interpretation was challenged in the U.S. District Court for the Northern District of California by the EB-5 Investment Coalition (EB5IC) through one of its members. Greenberg Traurig, as counsel for the plaintiff, argued that USCIS' interpretation ran counter to the plain language of the RIA and violated the Administrative Procedure Act because USCIS failed to properly engage in reasoned decision-making as required by law. On June 24, 2022, the Court agreed and enjoined USCIS from treating as deauthorized previously designated regional centers and declared they must be permitted to operate within the regime created by the RIA. As the Court stated, "[t]his includes processing new I‑526 petitions from immigrants investing through previously authorized regional centers…just as the agency would do for a newly approved regional center." As a result of this ruling, all previously designated regional centers retain their existing designation and can continue to operate. See previous post, District Court Orders USCIS to Process New I-526 Petitions Throughout Previously Authorized Regional Centers | EB-5 Insights (eb5insights.com)
On Aug. 24, 2022, the parties agreed to a settlement of the case (the court is still reviewing the settlement). See USCIS Settlement Agreement.
The parties included the original plaintiff, Behring Regional Center, an EB-5 Investment Coalition member and plaintiff intervenors, EB5 Capital, CanAm Enterprises, LP, Civitas Capital Management, LLC, Golden Gate Global, Pine State Regional Center, LLC, Invest in the USA (IIUSA). The key terms of the settlement include:
- Acknowledgement by USCIS that regional centers validly authorized to operate prior to June 30, 2021, did not lose their designation because of the RIA.
- Such regional centers will have to properly file a Form I-956 by Dec. 29, 2022, if not done so already.
- Regional centers validly authorized to operate prior to June 30, 2021, do not need to wait for approval of a Form I-956 in order to file and receive adjudications from USCIS on any other forms, such as a Form I-526.
- When adjudicating Form I-956s of these regional centers validly authorized to operate prior to June 30, 2021, USCIS will defer to its decision in its prior designation notices when adjudicating certain issues and will allow for attachments from past filings to establish approval.
- Form I-956F must be filed by all regional centers (new or regional centers validly authorized to operate prior to June 30, 2021) prior to the filing of an associated Form I-526E (even those with previously approved exemplar Form I-924s) and a Form I-956F should be included with the Form I-526E. Due to delays in the issuance of Form I-956F receipt notices, if a Form I-956F receipt notice is not issued within 10 days of delivery, USCIS will accept a lockbox notice along with a copy of at least the first six pages of the filed Form I-956F (Parts 1-5) for purposes of providing "the receipt number for the regional center's Form I-956F" in order to facilitate investors' ability to file a Form I-526E immediately after a regional center files the Form I-956F, or will accept proof of cashed check or credit card charge (along with regional center name, new commercial enterprise name, job creating entity name if available, and approximate Form I-956F filing date) for purposes of providing "the receipt number for the regional center's Form I-956F."
- USCIS will provide an electronic copy of receipt notices for all Form I-956F applications that have been or are properly filed within 16 weeks and will undertake best efforts to arrange for its lockbox contractor to have the capability to return a Form I-956F receipt notice via prepaid overnight courier (e.g., FedEx or UPS).
- For investors who previously filed a Form I-526 or Form I-526E without a Form I-956F but based on a previously approved exemplar Form I-924, such investor may either file a new Form I-526E and a receive a refund of the filing fee or may interfile the I-956F receipt notice. Such investor petitions will not be rejected solely for failure to provide a Form I-526E or include an I-956F receipt number, and those investors can keep their original priority date.
- USCIS will deem the new Forms I-956, I-956H, I-956F, I-956G and I-526E to be interim until the conclusion of notice-and-comment rulemaking. USCIS has already published the Form I-526E for notice and comment here. The deadline for comments is Oct. 24, 2022.
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