The EB-5 investment community is facing a new challenge. As many of the more seasoned EB-5 investment projects begin to mature, the original investment capital is returned by the project owner to the new commercial enterprise.
While USCIS published guidance on redeployment has prompted more questions than answers, one thing is certain: The EB-5 capital must be held at-risk at least until the applicant has completed his or her two-year conditional residency period.
NES Financial | JTC’s EB-5 Medallion Solution Partners Klasko Immigration Law Partners, LLP and Arnstein & Lehr, LLP have undertaken the task of proposing a set of standards and guidelines for redeployment of EB-5 investment capital in a White Paper with the intent that the principles of redeployment stated will be accepted by USCIS and by the EB-5 investment community.
The standards expressed in this White Paper should meet the “at risk” requirements established by USCIS, and should also meet the requirements of federal securities laws and the fiduciary duties of the general partner or manager of each new commercial enterprise when making a decision to redeploy investment capital in a new investment.
While acknowledging that this is an evolving issue and that new developments may occur that require changes in these proposed standards and guidelines, it is important to the EB-5 community that these standards and guidelines be offered as a model now, so that new commercial enterprises have a basis for analyzing options when the need to redeploy investment capital becomes a reality.
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