USCIS has filed an appeal of the Court’s Ruling in the Behring Regional Center case. The Behring ruling, issued by Judge Jacqueline Scott Corley in June, struck down the 2019 EB-5 Modernization regulations. These 2019 regulations had raised investment requirements for EB-5 visas to a minimum of $900,000 for TEA (Targeted Employment Areas) investments and $1,800,000 for investments outside of a TEA.
Judge Corley’s ruling effectively reverted EB-5 regulations to their pre 2019 form, with a minimum investment of $500,000 (for a TEA investments) required to be eligible for an EB-5 visa or $1,000,000 (for non-TEA investments). This led to a sharp uptick in EB-5 filings, as investors rushed to file petitions with $500,000 investments.
USCIS waited as long as possible to appeal the ruling; submitting their appeal on August 23rd, the deadline Judge Corley had set for an appeal of her decision to be filed. By filing an appeal USCIS is challenging the ruling of Judge Corley. The Behring case will be heard again by a Federal appellate court, who will decide if Judge Corley’s ruling applied the law correctly. If the Appellate court disagrees with Corley’s ruling, the 2019 EB-5 Modernization regulations may be put back in place and investment requirements could return to a minimum of $900,000.
What Does this Mean for Investors?
This appeal is the latest news in what has been a complicated time for the EB-5 program. While Judge Corley’s ruling opened up the opportunity for $500,000 EB-5 investments, it came only a week before the popular regional center program went on hold on June 30. This left a small window of opportunity for investors to file EB-5 petitions through regional centers with a $500,000 investment before the regional center program froze. Although some investors were able to make this deadline, USCIS has not been processing EB-5 petitions associated with regional centers since June 30 and is currently only accepting and processing direct EB-5 investments (including those with a $500,000 investment).
This means that the appeal of Judge Corley’s ruling could potentially leave investors in a tough position. If the appellate court overturns Corley’s decision and rules that the 2019 modernization regulations were lawful and enforceable, it would be up to USCIS to decide how to handle EB-5 petitions submitted during the period when the modernization regulations were technically not in effect.
However, it should be noted that USCIS has not filed a motion to stay Judge Corley’s decision and reauthorize the 2019 modernization regulations until the appeals court makes its decision. For the time being, it seems, USCIS continues to accept direct EB-5 petitions filed with a $500,000 investment (provided that the investment is located in a TEA). In the event of USCIS winning their appeal, it remains to be seen how regional center and direct petitions filed after Judge Corley’s ruling would be handled, but the agency’s decision to continue to accept petitions during the appeals process may be a sign that it is willing to accept and process these petitions regardless of the appellate court’s ruling.
While investors will certainly be hoping that the appeals court agrees with Judge Corley and rules in Behring’s favor, it’s unlikely that lower EB-5 investment requirements will remain in place indefinitely. In the event that the USCIS appeal is unsuccessful, it’s unlikely that the agency will simply abandon the 2019 modernization regulations. USCIS would likely seek to implement the regulations through legislation, and could seek to include them as provisions in a bill to reauthorize the regional center program.