On June 24, 2022, the U.S. District Court for the Northern District of California held that USCIS committed a legal error when it deauthorized EB-5 Regional Centers (RCs) that existed when the EB-5 Reform and Integrity Act of 2022 (RIA) was signed into law. As a result of this Court ruling, pre-authorized Regional Centers may continue with their operations and sponsor new EB-5 investors.

Background on the Decision

On June 30, 2021, the EB-5 Regional Center Program expired when Congress failed to reauthorize it on a timely basis. The Program was extended on March 15, 2022, when President Biden signed a spending bill that included the RIA extending it until September 30, 2027, while also making significant changes to the Program.

On April 20, 2022, USCIS announced that all existing Regional Centers are no longer valid, in turn eliminating all RC operations. They also announced that any previously authorized RCs seeking to sponsor new EB-5 investors must file a new RC application and await approval from USCIS. USCIS responded to criticism of these provisions by stating that these new policies were based on its reading of the RIA.

Lawsuit Against USCIS

On April 22, 2022, the EB-5 Investment Coalition's plaintiff, Behring Regional Center LLC, sued USCIS for its interpretation of the RIA which deauthorized all RCs. On June 24, 2022, the U.S. District Court for the Northern District of California ordered a nationwide preliminary injunction thus allowing RCs to immediately accept new investors as of the date of the decision. The judge ruled that USCIS may not deauthorize the previously valid RCs and those centers must be allowed to continue their operations in accordance with the RIA. Moreover, Form I-526 petitions from immigrants investing in RCs should resume processing. This will remain in effect until there is a ruling providing guidance on how previously valid Regional Centers should be treated. It is anticipated that the plaintiff will file a motion for summary judgement on all issues and questions regarding the case to provide further clarity.