1. Skip to navigation
  2. Skip to content
  3. Skip to sidebar

No more EB5 job creation through tenant-occupancy models: New USCIS policy reduces availability of immigrant investor funds to create jobs for Americans

On May 15, 2018, USCIS revised its Policy Manual, effective immediately. The agency will no longer count the jobs created for US workers through tenant occupancy of EB5 properties. The result of this change is to reduce the amount of immigrant investor funds available to create jobs for US workers.

“EB5” refers to the US employment-based fifth preference immigrant visa. EB5 is a program (sometimes called “traditional EB5”) Congress created in 1990 to stimulate the US economy through job creation for US workers using investment by foreign investors. In 1992, Congress created the Immigrant Investor Pilot Program (regional center EB5), a temporary program that Congress has repeatedly extended, most recently through September 30, 2018. (See our previous posting “EB5 immigrant investor visas are available again”).

Both types of EB5s generally require that at least ten full-time equivalent new jobs for US workers be created by each immigrant’s investment. A key advantage of a regional center EB5 is that “indirect” and “induced” jobs are included in the job creation count (in addition to “direct” jobs), whereas a traditional EB5 counts only direct jobs.

Direct jobs refer to US workers employed directly by the business that received the EB5 investment. Payroll tax records show direct jobs. Indirect and induced jobs refer to employees of other business as a result of EB5 investment. The calculation of indirect and induced jobs is based on an economic analysis using models accepted by USCIS.

The “tenant-occupancy” model counts job creation by independent tenant businesses that lease space in buildings developed with EB5 funding. In the past, USCIS accepted the tenant-occupancy model.

USCIS’ skeptical attitude toward the tenant-occupancy model can be traced back to early 2012 when it rolled out a Request for Evidence (RFE) template for tenant occupancy seeking evidence that the projected jobs attributable to prospective tenants would represent only newly created jobs, and not jobs that had merely been related from another location. In December of that year, USCIS issued “Operational Guidance for EB-5 Cases Involving Tenant-Occupancy,” which clarified that to claim tenant jobs, the economic analysis must project the number of newly created jobs that would not have been created but for the economic activity of the EB5 commercial enterprise. In making that projection, the claimant must use economically and statistically valid forecasting tools. USCIS made determinations on a case-by-case basis and would generally require an evaluation of the verifiable details provided and the overall reasonableness of the methodology as presented.

The 2012 memo suggested two ways to demonstrate a causal relationship between the EB5 investment and tenant jobs:

  1. “[M]ap a specific amount of direct, imputed, or subsidized investment to such new jobs” (i.e., “show an equity or direct financial connection between the EB5 capital investment and the employees of the prospective tenants”); and
  2. Utilize a “facilitation-based approach,” seeking to “demonstrate that the economic benefits provided by a specific space/project will remove a significant market-based constraint” and “result in a specified prospective number of tenant jobs that will locate in that space.”

Beginning in 2013, USCIS modified its tenant-occupancy model position. The agency’s RFE template identified the following three distinct areas of concern:

  1. Will there be tenants to occupy the space once construction is completed?
  2. Will the tenant jobs be “new jobs” and not “merely relocated”?
  3. Are the job creation estimates based on a reasonable and transparent methodology?

Over the years, practitioners in the EB5 field have reported that in tenant-occupancy cases, USCIS, when issuing RFEs or Notices of Intent to Deny, tended to require EB5 immigrants to either (i) remove tenant jobs from the job creation calculation; or (ii) submit additional evidence that shows by the preponderance of evidence (more likely than not) that the tenants will be there to occupy the commercial space when the project is finished, that the tenant jobs are not merely relocated from another commercial space within the same geographical area, and that the estimated number of tenant jobs is a reasonable estimate.

Given the lengthy adjudication time, the capital at stake and the uncertainty involved, many EB5 immigrants gave up claiming tenant jobs. Subsequent formulations of EB5 projects largely steered away carefully from the tenant-occupancy methodology to avoid potential issues.

Now, USCIS has formally rescinded its previous guidance and will no longer consider tenant-occupancy methodology. The agency will continue to give deference to Form I-526 and Form I-829 petitions directly related to previous approved projects, absent material change, fraud or misrepresentation, or legal deficiency of the prior determination.

USCIS is accepting comments on the new policy until May 29, 2018.

Full text of the agency’s Policy Alert can be found here. Dentons represents regional centers, EB5 investment programs and individual investors on both traditional and regional center EB5 programs. Please contact your Dentons lawyer for more information.

, , , , , , , ,

No more EB5 job creation through tenant-occupancy models: New USCIS policy reduces availability of immigrant investor funds to create jobs for Americans

Tier 2 Restricted Certificates of Sponsorship hit quota

Tier 2 Restricted Certificates of Sponsorship (CoS)—which employers use to employ non-EU/EEA nationals in the UK—are scarce.

All Tier 2 Restricted CoS applications that employers lodged before the April CoS allocation meeting on April 11, 2018, were successful, provided they scored 46 points or more. This meant that migrants had to be earning a minimum salary of £50,000. The pressure on the Tier 2 system is due to the drop in the number of EU/EEA migrants coming to the UK to work.

Only 1,975 Restricted CoS were available in the May allocation. Based on recent allocations, this will (again) not be sufficient to meet demand. In April, the Home Office granted 2,193 CoS. April was the fifth consecutive month that the allocation limit was exceeded. Employers across all industry sectors are urging the government to increase the cap amid a growing skills shortage.

Only prioritized applications, such as those on the shortage occupation list, PhD level occupations and where the salary is more than £50,000, will have a chance of success in May. Figures to be released at the end of the month will reveal the true picture.

, , , , ,

Tier 2 Restricted Certificates of Sponsorship hit quota

EB5 immigrant investor visas are available again


EB5 immigrant visas of all types are once again available to investors who create job opportunities for American workers. The Omnibus Spending Bill signed by the president on March 23 included the extension of the US immigrant investor EB5 regional center program to the end of September 2018.

The US State Department’s April 2018 Visa Bulletin will be revised soon to show that EB5 regional center immigrant visas are immediately available for all countries of birth, except mainland China, which is expected to have the same waiting period as the EB5 non-regional center program.

Media around the world has been warning readers of the demise of the EB5 regional center program. The US Embassy at Hanoi, Vietnam, announced on March 20 that no EB5 regional center immigrant visas would be issued after March 23. Now that advisory is no longer effective and immigrant visa appointments will continue to be scheduled at US embassies and consulates.

EB5 refers to the US employment-based fifth preference immigrant visa category. EB5 allows an investor, spouse and unmarried children under the age of 21 to obtain resident status in return for creating at least 10 full-time equivalent jobs for American workers through a business investment. The EB5 non-regional center program considers only jobs for workers directly employed at the business investment, while the EB5 regional center program also counts the larger number of indirect and induced jobs created as calculated by government-approved economic models.

Both types of EB5 generally require a US$1,000,000 investment, but a US$500,000 investment can qualify if the business is located in a targeted employment area. Such areas either have an unemployment rate 150 percent above the national average or meet the legal definition of rural.

There are proposals to raise these EB5 target investment levels, which have not changed since being set in 1990. Most experts expect substantial increases, along with other changes to EB5 regulations, but no one knows when this will happen. As a result, immigrants may want to act quickly to invest and file their EB5 immigrant visa petition as soon as possible. They should especially be sure to do so before September 30, 2018, when the EB5 regional center program is next set to expire.

, , ,

EB5 immigrant investor visas are available again

Temporary ban on hiring expats in the Oman private sector

 

 

 

 

February 21, 2018   

Welcome to our client update on recent legal developments and on a new Ministerial Decisions promulgated by the Ministry of Manpower in Oman.

This update summaries the new law temporarily banning the issuance of work permits to non-Omani individuals in 87 job categories in the private sector.

Dentons’ Muscat office has over three decades of experience of advising on employment law issues in Oman. For any points of clarification on the new MD or for any other employment law queries please do not hesitate to contact Dentons. We would be very happy to hear from you.

Click to read the complete article.

, , , ,

Temporary ban on hiring expats in the Oman private sector

The rights of EU citizens in the UK

The UK government has published a policy paper setting out its offer to EU citizens and their families residing in the UK regarding their right to remain in the country post-Brexit. The offer differs depending on how long a person has been in the UK.

People who have been continuously living in the UK for five years will be able to apply to stay indefinitely by getting “settled status.” A settled status residence document will be issued to prove an individual’s permission to continue living and working in the UK. Those already with an EU permanent residence document will be required to apply. The application process should come online before the UK leaves the EU, hopefully in 2018. The government has pledged to make the process as streamlined and user-friendly as possible.

Other EU citizens in the UK will be subject to a “cut-off date” after which they will no longer be automatically entitled to stay. The date is still to be negotiated, but may fall at any point between March 29, 2017 (the date that Article 50 was triggered) and the date that the UK leaves the EU.

EU citizens who arrived in the UK before the cut-off date, but who have not been here for five years when the UK leaves the EU, will be able to apply to stay temporarily until they have reached the five-year threshold, at which time they also can apply for settled status as set out above.

EU citizens who arrive in the UK after the cut-off date will be able to apply for permission to remain after the UK leaves the EU, under future immigration arrangements for EU citizens. The arrangements have yet to be determined, but the government stated that there should be no expectation by this group of people that they will obtain settled status.

Please visit The Global Mobility Review next month for further information on this development.

, , , , , ,

The rights of EU citizens in the UK

Show Me the Money: What the Trump administration’s budget and spending priorities reveal to employers

May 25, 2017
1:00 PM – 2:00 PM EDT
Webinar

Our Employment and Labor team marked the passage of President Trump’s first 100 days with a webinar on May 25, 2017 that looked at whether the president’s budget proposal backed up his prior public statements about wanted changes to employment, benefits and immigration regulations, as well as the impact on employers of the spending bill passed by Congress to prevent a government shutdown. By “following the money,” you can better prepare for future compliance demands and enforcement risks. For your convenience, the program can be viewed in it’s entirety and to register to the webinar by visiting the event page.

We hope you are able to join the program.

, , , , , , , ,

Show Me the Money: What the Trump administration’s budget and spending priorities reveal to employers

New H-1Bs for 2018 are gone

 

US employer demand once again greater than limited supply

United States Citizenship and Immigration Services (USCIS) once again received more H-1B visa petitions (for professional workers) from US employers than the limited supply allocated by Congress for fiscal year 2018.

The agency reported receiving 199,000 petitions during the first five business days of April—37,000 fewer than last year—the first time in years that the number of petitions has fallen.

The selection process was completed on April 11, but the agency did not announce by what date all accepted petition fee receipts would be issued, unselected cap-subject petitions returned with the uncashed filing fee checks, and approval notices for granted petitions sent.

As in years past, USCIS will reject and return filing fees for all unselected petitions that are not duplicate filings. Last year, most returns were received by June.

Congress authorizes USCIS to granted 65,000 H-1B visa petitions per fiscal year, plus an additional 20,000 petitions earmarked only for foreign nationals who earned a graduate degree from an American university. FY2018 starts October 1, 2017. For both of these quotas, the demand was greater than the supply, but USCIS has not provided a breakdown for each.

Certain H-1B visas remain available and USCIS will continue to accept and process petitions to:

  • Approve H-1B status to an individual coming to work for an employer that is exempt from quota limitations—generally the US government, American universities and certain related or nonprofit organization
  • Approve H-1B status to an individual counted previously against the cap and who is not subject to the FY2018 cap
  • Extend the amount of time a current H-1B worker may remain in the United States
  • Change the terms of employment for current H-1B workers
  • Allow current H-1B workers to change employers
  • Allow current H-1B workers to work concurrently in a second H-1B position

The full text of the agency’s press release can be found at the USCIS website.

, , , , , , ,

New H-1Bs for 2018 are gone

The Trump wild card: what employers can expect from the new administration

Thursday, January 26, 2017
1:00 PM – 2:00 PM EST
Webinar

With Donald Trump’s election as the 45th president of the United States, and the Republican Party retaining control of both the Senate and House of Representatives, employers can expect some changes.

Join us for an engaging discussion on the Trump administration’s workplace policy priorities, their likely impacts on employers, and what you can do now to prepare for the changes to come. Among the topics to be covered are: the effect on the labor pool of proposed changes in immigration policy; the impact of Obamacare “repeal and replace” on employer-sponsored health plans; compensation issues; the future of regulations covering whistleblowing and human rights protections; the Trump NLRB; the DOL’s Fiduciary Rule; and workplace discrimination. Dentons partner Cynthia Jackson will lead a panel of Dentons lawyers as they tackle these questions and more.

Meeting agenda

Immigration outlook: labor force issues

Campaign promises to increase worksite visa audits and investigations, build a wall along the Mexico border, establish a deportation force, and place new restrictions on immigration from some majority-Muslim countries may become law. The new Administration is likely to adopt policies even before Congress acts. How will these developments impact employers who rely on business visas to hire the best and brightest from around the world? We will predict the future and provide guidance on how employers can prepare now.

The repeal of the ACA and other developments post-ObamaCare

The election of Donald Trump to the presidency, together with Republicans maintaining control of Congress has, for the first time since the Affordable Care Act’s enactment, put the law’s future in serious question. With the new Administration taking the reins of government on January 20, we will discuss the distinct possibility of the ACA’s repeal and replacement, including options for the White House and the expected congressional timeline for debating and passing legislative changes.

Compensation and other DOL regulations

The Department of Labor raced to the end of the Obama administration with a wave of regulatory activity applying to the public sector and government contractors relating to overtime, blacklists, pay equality and sick leave. Courts stalled implementation of some of the more controversial regulations. How will the new administration act in its initial days regarding the recent flurry of regulations?

Whistleblower and human rights developments

During the campaign, President-elect Trump stated that he would dismantle Dodd-Frank, repeal President Obama’s executive orders and unburden companies of excessive regulation. We will address how that will impact whistleblower and bounty hunter programs at the SEC and elsewhere, as well as laws impacting eradication of human trafficking and slavery.

The DOL’s fiduciary rule and the evolution of the NLRB under Trump

The Trump NLRB is expected to reverse recent Board decisions relating to concerted activity, joint employment, election processes and other issues favoring labor. But when will the reversals begin? This presentation will address both NLRB issues and processes during the first year of a Trump presidency. In addition, we will briefly discuss the status and likely future of the DOL’s fiduciary rule.

Workplace discrimination

The Obama administration broadly interpreted Title VII to include anti-discrimination protections on the basis of sexual orientation and gender identity. We will look at whether that trend will continue under Trump. Other current trends in anti-discrimination enforcement and litigation will also be discussed, with a focus on statements made by the President-elect and his team during the campaign and the transition.

Register Now

, , , , , , , ,

The Trump wild card: what employers can expect from the new administration

New national interest waiver ruling

greencard

 

Increased immigration opportunities for individuals of exceptional ability

There are increased opportunities for individuals of exceptional ability to immigrate to the United States based on new national interest waiver rule after the US Department of Homeland Security issued on December 27, 2016, designated the Matter of Dhanasar decision as precedent.

Summary

The new rule means that USCIS may grant a national interest waiver if the petitioner demonstrates:

(1) that the foreign national’s proposed endeavor has both (a) substantial merit and (b) national importance;

(2) that he or she is well positioned to advance the proposed endeavor; and

(3) that, on balance, it would be beneficial to the United States to waive the requirement of a job offer and thus of a labor certification.

The employment-based second preference immigrant visa category (EB2) includes individuals of exceptional ability who can self-petition to immigrate.  That means they sign their own immigrant petition and do not need a sponsoring employer. Further, the normal requirement of an employer obtaining an alien employment certification from the US Department of Labor can be waived on a showing that the waiver is in the national interest.

Analysis

The new rule states that “substantial merit” may be in a range of areas, citing business, entrepreneurialism, science, technology, culture, health, or education, research, pure science, and the furtherance of human knowledge as examples.  Showing the potential to create significant economic impact may be favorable, but is not required.

“National importance” focuses on potential prospective impact, rather than geographic terms.  National or global implications are relevant, but even a ventures that focus on one geographic are of the US may qualify.

The requirement that the immigrant be well positioned to advance the proposed endeavor focuses on the immigrant.  Relevant factors include education, skills, knowledge, and record of success in related or similar efforts, plan for future activities, and the interest of others (e.g., potential customers, users, investors).

The benefit to the US is an analysis of both:

  • Impracticality of securing a job offer or alien employment certification; and
  • Benefit of the immigrant’s contributions to the US warrants foregoing the alien employment certification.

Matter of Dhanasar

The immigrant in Matter of Dhanasar held a PhD in Engineering, as well as Master’s degrees in Mechanical Engineering and Applied Physics. His research focused on hypersonic propulsion systems and computational fluid dynamics.  He developed a validated computational model of high-speed air-breathing propulsion engine and a novel numerical method of calculating hypersonic air flow.  He intended to work in air and space propulsion systems R&D at university, as well as supporting teaching activities in STEM disciplines.

The US Citizenship and Immigration Services denied the immigrant petition, but that decision was reversed on appeal to the Administrative Appeals Office.  The AAO found there was both substantial merit and national importance to the immigrant’s work due to potential use in military and civilian applications, advances to scientific knowledge, and American national security and competitiveness applications.  The high level of accomplishment to date by the immigrant was found to show benefit to the US even assuming that other qualified US workers are available.

Matter of New York State Department of Transportation

The new ruling vacates the AAO’s decision in Matter of New York State Department of Transportation, which had been in effect since 1998.  That case severely limited self-sponsored EB2 due to a restrictive interpretation of the national interest waiver requirements, which was often misinterpreted by the USCIS to require the very labor market test that was intended to be waived.

Impact

The new ruling makes the self-petition EB2 national interest waiver much more widely available.  As a result, we anticipate a significant increase in filings, including in some cases where the self-petition EB1 extraordinary ability immigrant visa category might be in consideration.  On the other hand, the EB2 category remains oversubscribed with long waiting periods for immigrants born in mainland China and India.  These individuals will continue to shun EB2 in favor of the more stringent requirements of EB1.

The complete text of Matter of Dhanasar can be found here.

, , , , , , , , , , ,

New national interest waiver ruling

UK announces changes to Immigration Rules

uk-flag-and-passport

On November 3, 2016, the UK Home Office announced several changes to its visa policies. The new Immigration Rules, which go into effect on November 24, will primarily affect Tier 2 migrants and nationals of countries outside the European Economic Area (EEA).

Tier 2

The following changes will affect all certificates of sponsorship assigned by Tier 2 sponsors on or after November 24, 2016:

Increasing the Tier 2 (General) salary threshold for experienced workers to £25,000, with some exemptions

  • Increasing the Tier 2 (Intra-Company Transfer) salary threshold for short-term staff to £30,000
  • Reducing the Tier 2 (Intra-Company Transfer) graduate trainee salary threshold to £23,000, and increasing the number of places to 20 per company per year
  • Closing the Tier 2 (Intra-Company Transfer) skills transfer sub-category

The government has not yet announced a date from which intra-company transfer migrants will be liable for the immigration health surcharge.

Non-EEA partners

The government has introduced a new English-language requirement for non-EEA partners and parents. This affects those applying to extend their stay after 2.5 years in the UK on a five-year route to settlement under Appendix FM (Family Member) of the Immigration Rules (introduced in July 2012).

The new requirement will apply to partners and parents whose current leave under the family Immigration Rules is due to expire on or after May 1, 2017.

The English-language requirement applies to most immigration applications. This includes those seeking to enter the UK for employment under the points-based system, and students seeking to enter the UK under Tier 4 of the points-based system.

, , , , , ,

UK announces changes to Immigration Rules