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Regional Centers -- Features, Benefits & Requirements


[Q] What form of legal entity is used by most regional center projects to establish the requisite "new commercial enterprise"?

For various reasons, most Regional Centers use the Limited Partnerships formed pursuant to the Uniform Limited Partnership Act of the applicable state law. But there is no reason not to use corporations, etc.

[Q] On what types of EB-5 projects are investors' funds spent?

First, regional center designation letter controls the type of project, structure and the specific geographic region. Therefore, any EB-5 project must comply with the conditions of the RC designation letter.

Most RC projects involve building or expanding big buildings, such as Pennsylvania Convention Centers, UPENN hospital, building shipyard factories, hotels, real estate development projects, and helping film production studios make movies.

[Q] Can a regional center contain a provison stating it will return the fund to investor in the event of I-829 denial?

Unfortunately no. USCIS recently ruled that this blanket provision stating the return of the money in the event of I-829 denial is not allowed. The rationale for this is that if this was allowed, there would be almost no risk for EB-5 investors. We can tell you that if this was allowed, many regional centers would accommodate such provision, but it's not allowed, so that's that. Also, practically speaking, it's hard to return the investor's money once the money has been invested into a EB-5 project towards the job-creation activities.

[Q] Do regional centers return the money in the event IV or I-485 adjustment is denied?

Most of the better-known regional centers probably do. The offering documents contain a provision that the EB-5 investor's fund will be returned promptly in the event Immigrant Visa or I-485 is denied. The investor doesn't have to worry about the money being returned in the event of I-526 petition denial because their money is being held at an escrow account, so it will be released in the event I-526 petition is denied.

[Q] Do all Regional Centers require that the investment fund be deposited into an escrow, and when is the release date?

[Q] Do all regional centers require that the investment amount be deposited into a designated escrow account, and when is the release date of such fund to the new commercial enterprise entity?

Probably yes, because this is designed to protection to EB-5 investors and at the same time hold the funds in a designated escrow account until it has been demonstrated to be of lawful source through I-526 petition approval.

The release date may vary according to regional centers. Most require the release after the approval of I-526 petition, to be safe, because this date is a balance between the need to wire the money as soon as possible to help the EB-5 project, and also to make sure that EB-5 investor will be protected.

[Q] What is the standard amount to be paid by the EB-5 investor for Regional Center case?

Most Regional Center Programs require the minimum $500,000 USD investment amount. In addition, they generally have additional costs and fees of $25,000 to $55,000 USD. The difference in the additional costs and fees might be due to the difference in including immigration attorney fees or having the investor pay the immigration attorney fees on his own.

[Q] What is a regional center, and what are the advantages for EB-5 investor?

A "Regional Center" is:

1) Ann entity, organization or agency that has been approved as such by the USCIS;

2) Which focuses on a specific geographic area within the United States; and

3) Which seeks to promote economic growth in the region through investment, or any improved regional productivity, creation of new jobs, and increased domestic capital investment.

Of the 10,000 investor visas (i.e., EB-5 visas) available annually, 3,000 are set aside for those who apply under a pilot program involving an CIS-designated “Regional Center.”

[Q] Who can apply to become a designated regional center for a particular region and structure, and how long does it take?

Any governmental entity or for profit entity can apply to designated a regional center. It can take up to 1.5 years or it can be approved quickly. It all depends how thorough are the documents submitted in connection with the request to become a regional center. There is a concern whether the processing times of EB-5 related applications will be adversely affected by more regional centers.

[Q] How many USCIS designated regional centers are there as of January 2009?

There are close to 70 designated centers spread across various states as of December 2009. Note many of them do not have track records on completed projects, approved I-526s or I-829s. You may go to www.eb-5center.com/RC_list to view the most current list of designated regional center list.

[Q] Is it true that for some regional centers, the creation of employment is "pre-approved" and can include indirect employment?

Yes and no. It is true that an approved regional center can include new positions created directly, indirectly or by induced means. However, the term "pre-approved" implies that USCIS will not question the job-calculation at the I-829 stage once I-526 petition is approved; this just is not true. A more accurate way to describe is that a specific job-calculation methodology that is included and submitted as part of I-526 petition (as well as part of the regional center designation request letter and approval) is deemed to be approved by USCIS when the underlying I-526 petition is approved. However, most, if not all, job-calculation studies contain some key assumptions that underlie the job numbers results reached by utilizing the job-calculation methodology.

[Q] What is the relevance and benefits of being designated as a Regional Center by USCIS?

Basically, the relevance of being designated as a regional center is that the applicant (a for-profit or non-profit company can apply for designation) can establish EB-5 projects within the geographic region and the parameters set forth in the regional center designation letter in terms of investment structures and types of industries, etc. in order to attract foreign investors.

[Q] I heard of Regional Center Program being regferred to as the "Pilot Program". What is it?

Pilot Program is the type of EB-5 investment program created by a specific EB-5 statute, and Regional Center is an EB-5 investment mechanism falling with the Pilot Program. For the practical purposes, they are the same thing.

[Q] Can an approved Regional Center be canceled by USCIS?

Yes, if the Regional Center commits fraud and misrepresents or remains inactive for a prolonged period of time without setting up EB-5 projects, or violates the parameters set out in the Regional Center Designation Letters, then USCIS may issue a Notice of Intent to Withdraw the Regional Center designation.

[Q] What does it mean when some sources say that the Regional Center Program has been "revived" in 2002?

[Q] Many sources say or state that the Regional Center EB-5 Program has been "revived" or "re-established" in 2002. What does this mean? Is this true? I thought the Regional Center Program existed since 1993?

It's largely an accurate description. Even though the Regional Center Program existed since 1993, from 1997 to 2002, the Regional Center Pilot Program suffered a severe set-back that resulted from the varying positions taken by the USCIS and also by some Regional Center Program which pushed the EB-5 law over the edge of common sense.