Modernization Rule of 2019

Modernization Rule of 2019: Explained

The EB-5 Modernization Rule of 2019 was a new set of regulations that was implemented on November 21, 2019. The Modernization Rule was later declared invalid by a court on June 22, 2021.

The Modernization Rule of 2019 made some major changes to the EB-5 industry including the following:

  • An increase in minimum investments amounts from $500,000 to $900,000, and an increase in standard investment amounts from $1,000,000 to $1,800,000

  • New and more listing targeted employment area (TEA) rules

  • Priority date retention for investors involved with terminated regional centers and who make a new investment and file a new I-526 petition

Overall, the Modernization Rule of 2019 was not well received by either the industry or investors, mostly due to the 80% increase in minimum investment amounts.

A lawsuit challenged the Modernization Rule and on June 22, 2021, a federal judge struck down the new regulations declaring that they were not lawful as the then-acting Department of Homeland Security (DHS) secretary was not properly appointed in his position.

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