Many people seek to set up EB-5 projects within a geographical area, so they submit a Regional Centre application, and if approved, they can do so according to the investment structure and industries described in their application. An area designated by the USCIS, as eligible to accept immigrant investor capital, is referred to as “Designated Regional Center”.
The benefits of a Designated Regional Center (RC) include the promotion of economic growth, improved regional productivity, indirect job creation, and increased domestic capital investment. An additional benefit of the US permanent residence catches the attention of foreign investors in the United Kingdom, Canada, Australia, and other foreign nations even if the financial return is modest.
The Regional Center Investment Program allocates 10,000 Green Cards each year for those people who invest in the designated Regional Centres. However, obtaining a Regional Center designation does not guarantee the issuance of permanent Green Cards upon making necessary investments.
The EB5 investors should know that the USCIS will not automatically approve all I-526 petitions and/or I-829 petitions submitted under an EB-5 project carried out under such designated Regional Center program. The USCIS approval of an EB-5 Regional Center application does not in any way:
- Constitute the USCIS endorsement of the activities of that Regional Center;
- Guaranteed compliance with US securities laws; or
- Minimize or eliminate risk to the investor
Such investments can be of various types: loan based; active trading businesses equity; or property equity investment. The potential investors are encouraged to seek professional advice while making any investment decisions. Some desirable features in an investment are:
- capital protection
- success history with visa applications
- faster approvals
- compensation for inflation with income and
- capital growth prospects
A Regional Center can be owned by private corporate bodies or by local or State Government. Privately created Regional Centres are not supervised by any independent authority other than the USCIS. Some merits of the State owned Regional Centres are accountability, compliance, and state oversight.
Though there are currently over 150 USCIS designated Regional Centres, there has been a marked increase in the denial rate of the I-829s. It is therefore crucial to structure the Regional Centres in agreement with the EB-5 law or else the RC status may be withheld.
An evaluation of Regional Centres depicts that there are certain legal and financial risks associated with them such as the loss of principal, or the failure to receive unconditional lawful permanent residence status. In order to assist one’s organization, in promoting its own EB-5 Regional Center or investment project to overseas investors, the advice of marketing experts may well be sought.
