The EB-5 Modernization Rule of 2019, which went into effect on November 21, 2019, introduced a new set of regulations to the EB-5 industry. However, the Modernization Rule was deemed invalid by a court on June 22, 2021.
The Modernization Rule had significant impacts on the EB-5 industry, including:
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.
Following a legal challenge, a federal judge declared the Modernization Rule unlawful on June 22, 2021. The ruling was based on the grounds that the then-acting DHS secretary was not validly appointed in their position.
