U.S. Congress members Joe Garcia (top image) and Judy Chu (bottom image) meet with Dr. Winner Xing, President of Worldway Capital.
Currently, the EB-5 investment immigration program in the United States is favored by Chinese investors due to its shorter application approval time and minimal qualification restrictions, leading to a rapid increase in the number of applicants in recent years. Additionally, with obstacles in Canadian investment immigration, tens of thousands of Chinese investors have turned to the United States.
As the U.S. EB-5 investment immigration program heats up, countless EB-5 projects are released each year, with varying quality, presenting a selection dilemma for Chinese investors. In response, our newspaper specifically interviewed Dr. Winner Xing, President of the well-known U.S. investment immigration agency Worldway Capital, to analyze the current status and risks of U.S. investment immigration from a professional perspective.
Reporter: Could you briefly introduce what U.S. EB-5 investment immigration is?
WINNER XING: The U.S. EB-5 investment immigration refers to the EB-5 visa category in U.S. immigration law, abbreviated as EB-5 (Employment Based Fifth Preference), which is a category established for overseas investment immigration applicants. The investment threshold for this category is generally $1 million; however, if the investment target is located in a Targeted Employment Area (TEA) as defined by national statistics, this threshold can be reduced to $500,000. Foreign immigrant applicants can obtain a two-year conditional green card by investing $1 million or $500,000 in a business within the United States and creating 10 jobs. 90 days before the two-year period expires, if the investment is still active and has created 10 full-time jobs, the investor can apply to remove the conditions.
The advantage of U.S. EB-5 investment immigration lies in the absence of requirements for applicants regarding education, language, age, or business background. Spouses and children under 21 can also obtain U.S. green cards simultaneously, making it the simplest and fastest way to immigrate to the United States, and it has become the most popular investment immigration program in recent years.
Reporter: What is the current status of U.S. EB-5 investment immigration? What risks do investors face?
WINNER XING: This year is full of uncertainties for U.S. EB-5 investment immigration. The U.S. State Department has issued a warning that the 10,000 EB-5 visa quota for 2014 will be filled, entering a period of backlog. Once the backlog occurs, the time cost of investing in U.S. immigration will significantly increase. Additionally, last year the U.S. Senate passed a bill that requires the EB-5 investment amount to be adjusted for inflation; if the bill is ultimately passed, the investment amount may rise to over $820,000.
Under the expectations of "backlog" and "price increase," and since EB-5 projects must be "at risk," many investors are hesitant. From a professional perspective, the process for U.S. immigration applicants to obtain permanent green cards often involves two steps: I-526 approval and I-829 removal of conditions. According to U.S. EB-5 regulations, the EB-5 investment must be at risk after the investor's I-526 application is approved. This means that before the approval of the investor's I-526 application, immigration law allows EB-5 funds to be secure. After the approval of the investor's I-526 application, they primarily face risks related to the green card and the investment.
Reporter: How can the risks of U.S. investment immigration be reduced?
WINNER XING: Before the approval of the investor's I-526 application, immigration law allows EB-5 funds to be secure. At this stage, a bank escrow account can be established, where the U.S. EB-5 investor signs an escrow agreement with the supervising bank and transfers the investment funds into the escrow account, stipulating that the EB-5 funds can only be released after the investor's I-526 is approved; if the investor's I-526 is denied, the supervising bank must refund the EB-5 funds to the investor within a reasonable time.
This banking supervision service during the U.S. investment immigration process (similar to Alipay) is also known as third-party conditional payment service. The escrow agreement stipulates that the supervising bank must pay or refund the supervised funds according to the conditions specified in the escrow agreement. This safety valve mechanism in EB-5 investments provides an initial safety guarantee for EB-5 investors, ensuring that their funds are under the bank's secure supervision before their I-526 application is approved. Otherwise, if EB-5 funds are released prematurely and the I-526 application is denied (in July 2014, the denial rate for I-526 applications reached 30%), the project developer must have another source of funds to return the denied EB-5 funds, which most developers do not have the capacity to do, making repayment potentially delayed.
Reporter: What advice do you have for investors choosing EB-5 projects?
WINNER XING: Currently, in the increasingly strict environment for U.S. investment immigration I-526 approvals, choosing EB-5 projects with a bank supervision mechanism has become a consensus among U.S. EB-5 investors. Unfortunately, at this stage, there are fewer and fewer EB-5 projects with standardized and complete escrow accounts. Therefore, investors must be vigilant and carefully discern.
When reviewing the supervision mechanism of EB-5 projects, investors should first check whether the project has established an escrow account; second, examine the conditions for releasing funds from the escrow account; and third, look at the refund conditions for the investment amount and issuance fees. Although the U.S. EB-5 law stipulates that the investor's investment must be "at risk," it does not specify the extent of the risk. As long as it does not provide a "redemption guarantee" to the investor, even investments in EB-5 limited partnerships that are relatively low-risk are compliant with immigration law, provided they can create sufficient jobs. Choosing EB-5 projects with supervision mechanisms and relatively low risks can serve as an important reference for investors.
Reporter: I noticed that Worldway Capital has set up a section for "Market Available Projects" on its website. What is the purpose of this?
WINNER XING: As we all know, intermediaries play a role in helping investors select projects in the "immigration project supermarket." EB-5 investors have the right to choose and compare any EB-5 projects available in the market. During the process of immigrating to the United States, when investors choose EB-5 projects, they sign an "immigration service agreement" with a legitimate private immigration intermediary, rather than an investment agreement. Investors assess the risks of investment projects based on their knowledge and experience, weigh their risk tolerance, and then independently make decisions about investment projects, subsequently signing all relevant investment documents with the U.S. EB-5 project party. Clearly, investors come first, followed by investment agreements; the decision to invest is a personal choice of the investor.
Worldway Capital has won the Best Immigration Agency Award at the U.S. EB-5 Annual Conference for three consecutive years. In promoting the U.S. EB-5 investment immigration program, we have always fully respected the investors' right to choose and have long objectively displayed the main EB-5 projects available in the market on our company website, providing greater choice for EB-5 investors, which has been recognized and welcomed by investors.
Reporter: Could you introduce the Worldway Capital Immigration Group?
WINNER XING: Worldway Capital focuses on the field of investment immigration and is one of the earliest immigration agencies to introduce the U.S. EB-5 investment immigration to China. Worldway Capital was the first in the industry to propose the concept of "selected projects" for U.S. investment immigration, possessing a strong professional team for U.S. project analysis, dedicated to the investigation, analysis, and selection of U.S. projects. We have consistently selected EB-5 investment projects that are both valuable and relatively safe from the numerous EB-5 projects released by hundreds of U.S. regional centers, providing strong guarantees for the safety of investors' green cards and funds as much as possible.
Worldway Capital's professionalism has been highly recognized in the U.S. EB-5 industry. It is the only Chinese immigration agency to receive awards directly from U.S. governors. Worldway Capital has won the Best Immigration Agency Award at the U.S. EB-5 Summit for two consecutive years and has been awarded the Most Honest Immigration Service Agency in the U.S. for three consecutive sessions.
At the same time, Worldway Capital has also established good relationships with U.S. government officials. I have met with Judy Chu, the only Chinese American congresswoman, to discuss U.S. EB-5 investment immigration in depth. Recently, I met with another U.S. congressman, Joe Garcia, a supporter and promoter of immigration reform, who believes that EB-5 investment greatly benefits the U.S. economy and employment, and that U.S. immigration reform will ultimately develop in a positive direction.
