Review of 2017 USCIS Change of Rules for Redeployment

Posted on 07/27/2018 by Mark A. Ivener, A Law Corporation

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As we have been continuing to provide new viewpoints and updates on key facets of the EB-5 program, a few potentially meaningful regulatory changes enacted over the past few years have not been fully explored. With that in mind, this article is meant to explain a set of existing requirements that were changed in June of 2017, but that may have important effects on EB-5 as more people look to utilize the program.

Changes to Redeployment of Funds

One of the most important shifts enacted in June 2017 was a meaningful change to how funds at risk can be redeployed from a New Commercial Enterprise (NCE). The change, which was announced only via a USCIS email and one-page Policy Alert, states that EB-5 funds must be redeployed in a way that is “related to engagement in commerce”, is “consistent with the scope of the NCE’s ongoing business” and takes place within a reasonable time”. This is a change from prior industry understanding that funds could be deployed through into a variety of new vehicles. These regulatory additions are quite vague, so we find it important to try to break this down for EB-5 investors who may be affected.

At its core, this change seems to have been intended to keep EB-5 investors from redeploying their funds into relatively low risk investments. Historically, it has been common for EB-5 investors to redeploy funds into marketable securities, certificates of deposit and other relatively safe investment vehicles. The changes from the USCIS, in our opinion, signal a shift to try to ensure that more funds are redeployed into larger scale projects with high economic and job creation potential. The USCIS gave an example saying that NCEs that were founded to lend money for residential construction should aim to redeploy funds in “similar loans to other entities” or into infrastructure-focused municipal bonds. Furthermore, USCIS guided that funds should be deployed into projects that are within the scope of the NCE’s ongoing business.

Within this context, our advice is that EB-5 investors ensure that the operating agreements (OAs) and private placement memorandums (PPMs) used to set the scope of the NCE define this scope as broadly as possible. By keeping the scope of the NCE broad, it should be easier to justify redeployment of funds into a higher variety of potential investments. Simultaneously, we would advise that investors look for NCEs with relatively well-defined potential redeployment vehicles. In this way, EB-5 investors should be able to preserve options, while protecting themselves from undue risk.

Changes to Capital at Risk Regulations

Another major change that was made in June of 2017 was a clarification that an investor’s funds only need to remain at risk for two years of conditional residence. Before this shift, USCIS maintained that funds would remain at risk for the entire term of an investor’s conditional residence, which can easily last many years, as long as USCIS is adjudicating their I-829 petition. The new guidance ensured that investors could expect their funds to no longer be at risk after two years, allowing them to take greater control of their investment.


While we expect that some these rules may be changed or clarified over time, especially if we see new, more comprehensive EB-5 legislation in the near term, it is important to note how these changes will affect investors looking to enter the program now.

If you are interested in pursuing a US Green Card through the EB-5 program, we strongly advise the employment of an experienced immigration lawyer to guide you through the oft-changing regulatory environment. Mark Ivener is an EB-5 expert with over 20 years’ experience guiding investors through this process.

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