The report shows how in FY 2022 EB-5 petitioners who had to undergo consular processing suffered from poor visa-issuance numbers, due to the program shutdown and the impact of COVID. However, we saw an unprecedented number of EB-5 visas issued to petitioners who adjusted status in the U.S. EB-5 expert Suzanne Lazicki attributes this increase to political pressure on USCIS.
The 2022 annual report from the Visa Office regarding EB-5 visas issued by country in FY 2022 has been released by the Department of State. The report details visas issued between October 2021 and September 2022, by country of origin, path (consular processing or status adjustment), and visa type (direct, regional center, TEA, reserved, unreserved).
EB-5 business plan writer and processing expert Suzanne Lazicki has analyzed the report and provides observations and insight on visa wastage, Integrity Act implementation, and the impact on the visa backlog and wait times for petitioners from the three backlogged countries —China, India, and Vietnam.
Consular processing petitioners were the losers in 2022
19,987 EB-5 visas were available in FY 2022. USCIS issued 10,885, leaving 9,102 visas unissued.
It should be noted that 6,396 visas were part of the new set-aside categories and could not be used. The remaining 2,706 unissued EB-5 visas in FY 2022 were permanently lost to the program.
In terms of visa wastage, FY 2022 fared better than in FY 2021 when EB-5 lost a total of 15,673 visas, and in FY 2020 when the program lost 7,498 visas.
Visa wastage had a significant impact on countries with a higher proportion of consular processing (rather than adjustment of status for petitioners already in the U.S.).
To establish benchmarks for visa wastage, Lazicki makes comparisons to FY 2019, the most recent “normal” year. In FY 2019 South Korean petitioners were issued 695 visas, but only 396 visas in FY 2022 (86% through consular processing), even though 909 were registered at the National Visa Center in FY 2022.
Hong Kong petitioners had a similar situation receiving only 142 visas in FY 2022 despite 866 applicants being eligible at the National Visa Center.
Clearly, petitioners going through consular processing were the biggest losers when it comes to lost EB-5 visas in FY 2022; as a point of comparison, Indian applicants were issued a disproportionately high 1,381 visa that year — a result of many Indians adjusting status in the U.S. rather than going through consular processing in India.
Regional Center Program Expiration and COVID largely to blame
EB-5 visa issuance in FY 2022 was low largely due to the period of regional center program expiration from October 2021 to May 2022. Regional center applicants were only issued visas between June through September 2022 (the fiscal year ends October 1).
The challenges of COVID also had a negative impact on consular processing, resulting in far fewer visas issued than normal.
Direct visa numbers up in FY 2022
In FY 2022 621 direct EB-5 visas were issued. In comparison, in FY 2019, 414 direct EB-5 visas were issued. The higher number is due to the regional center shutdown as direct investing was still available.
A positive from FY 2022: more family-based visas will roll over to EB-5
Consular challenges also limited family-based visa issuance — and this benefits EB-5, as in FY 2023 the program will collect the unused FY 2022 family numbers and have a total of 13,987 visas, much higher than the roughly 10,000 EB-5 visas available in a regular year.
Political pressure drives unprecedented numbers for adjustment of status
While consular processing suffered, FY 2022, saw more visas issued through adjustment of status, accounting for a 37% of the total visas issued, compared with just 17% of the visa total in FY 2019.
Lazicki attributes this significant increase to political pressure on USCIS, as the agency “made herculean efforts at the end of FY 2022 to step up work on employment-based status adjustments, even as consular processing continued to struggle post-COVID.”
Lazicki observes that Indian petitioners, many who are already in the U.S., as compared with East Asian petitioners, received a disproportionate share of visas.
“It's possible that Indians were assigned ‘otherwise unused’ numbers at the end of the year that should have gone to earlier Chinese priority dates, but the consulate in China lacked the capacity to hold more interviews in time. The California Service Center had the capacity to complete more I-485s,” Lazicki says.
New unserved category in 2022 — but no visas issued
The Visa Office Report of 2022 divides EB-5 visas into two categories: "5th Unreserved" and "5th Set-Aside,” as per the newly enacted EB-5 Reform and Integrity Act of 2022.
However, no visas were issued in 2022 in the "5th Set-Aside" category since applicants who filed I-526E petitions after March 15, 2022 simply did not have enough time to be processed before the fiscal year ended just five months later.
Distribution of visas by country
The distribution of EB-5 visas in FY 2022 by country was similar to prior years. China received the most visas, followed by India, Vietnam, South Korea, Brazil, and Taiwan.
However, there were some changes to the country ranking, with Mexico, Canada, Russia, and Iran moving up the list, while Venezuela, South Africa, Great Britain, and Japan dropped down.
How 2022 changed the backlog for China, India, and Vietnam
In November 2021, Former U.S. Chief of Immigrant Visa Control Charles Oppenheim estimated that the EB-5 backlog (including applicants registered at NVC and future applicants with I-526 pending at USCIS), was 57,253 for China: 7,418 for India, 3,954 for Vietnam, and 18,054 for the rest of the world.
Visas issued in FY 2022 reduced the backlog by 6,125 for China, 1,381 for India, and 815 for Vietnam. Lazicki assumes that FY 2022 I-526 filings did not increase the lines very much, unless most of the I-829 filings that year were from Indians.
So what does this mean for future visa wait times for unreserved petitioners from the three retrogressed countries? The wait times, Lazicki states, depend on the number number of petitioners who quit EB-5 before being processed or lose eligibility, and the number of available future visas.
She reminds us that the “base” number in a standard year is 9,940 visas, with 68% of this number, or 473, going to unserved petitioners.
But the actual number going to unreserved petitioners can exceed 473 due to three factors: the carry-over of family-based visas (which is happening in FY 2023); the carry-over of unused reserved visas (which should occur in both 2024 and 2025); and the number of unused unreserved visas — which go to earliest petitioners in the unreserved line.
However, even with the best-case scenarios for future visa availability, Lazicki says that Chinese petitioners who filed I-526 from October 2016 to March 2022, and Indians who filed I-526 from November 2019 to March 2022, could face five or more years to begin conditional permanent residency.
She also notes that this wait exceeds what many applicants will endure, and will result in many dropouts and failures that will shorten the lines for these countries.
See Lazicki’s article “FY2022 Annual Report of the Visa Office for EB-5 visas issued by country”