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Marked Trends In The Selection Of Regional Center EB-5 Programs Over E-2 Visas By Korean Investors

by Young Noh

Within the last twelve months, the increase in the number of approved EB-5 Regional Center Programs (herein referred as "RC Programs") that have been marketed in Korea [1] has led to a noticeable trend in which Korean investors, who normally would have chosen E-2 visas in the past, are now seriously considering and selecting RC Programs instead. This trend may also be noted in other countries as well, such as China and Taiwan. This article will discuss various reasons for this trend by examining why increasing numbers of Korean investors may be choosing to participate in RC Programs rather than apply for E-2 visas.

RC Program Developments and Results

1. Whereas in the past, the EB-5 Program has generally been viewed as a possible but unproven path to permanent residency, RC Programs are now being viewed as a viable choice for emigration because applicants, through several RC Programs, have now successfully removed their conditional status via I-829 petitions. As more I-829 approvals are obtained by various RC Programs, the once perspective skeptical perspective towards RC Programs is bound to diminish.

2. Lawful source of funds issues and documentation for I-526 petitions for RC Programs are being adjudicated more consistently, timely and understandably at the USCIS' Texas and California Service Centers, which have established jurisdiction for EB-5 investor petitions. Rather than mandating that petitioners prove well beyond any possible doubt that funds deposited into escrow are traceable from one bank account to another throughout the petitioner's entire history (which may often span over 25 years), USCIS is now utilizing a more reasonable and practical approach for proving both lawful source and immediate source of investment funds. This kind of consistency and practical approach is especially important because of the increasing number of both I-526 and I-829 cases [2] being submitted to USCIS.

3. The USCIS Foreign Trader, Investor and Regional Center Program ("FTIRCP"), headed by Morrie Berez, working in direct and close relationship with the California and Texas Service Center EB-5 Team, together have shown a greater understanding, appreciation and willingness to recognize and work with RC Programs to reasonably address and resolve questions and issues that may arise during the petitioning process. For example, because of the limited number of I-829 petition approvals since the EB-5 Program first started, the existing USCIS online system only allows petitioners to check the status of the I-526 petition, but not the I-829 petition, and most applicants and attorneys who submitted I-829 petitions in the past 12-18 months often did not receive any Receipt Notices and/or Approval Notices. Moreover, the few Receipt Notices that were issued for I-829 petitions did not list dependent family members. However, once Mr. Berez and FTIRCP and the rest of the USCIS EB-5 Team at the Texas and California Service Centers became aware of this difficulty, they began issuing tailored Receipt Notices and/or Approval Notices in order to resolve the problem. Although it is too early to know if this solution will be implemented for all future I-829 cases, this example demonstrates the responsiveness of USCIS, through the FTIRCP, TSC and CSC to petitioners' predicaments. Clearly, based on the recent I-829 Receipt Notices and Approval Notices, USCIS has tackled and resolved this matter rather successfully.

4. The previous decentralized USCIS EB-5 Program structure has been more refined and restructured through the USCIS-FTIRCP, which possesses more flexible and coordinated means to oversee and effectively manage all issues concerning Regional Center Programs. [3] Within the last two years, FTIRCP has approved numerous new RC Programs and reaffirmed a handful of legacy INS RC program, and in their corresponding designation and re-affirmation letters, FTIRCP has delineated the specific administrative, reporting and oversight requirements to which these RC programs now are subject. The increased pool of affirmed RC Programs allows potential investors to choose the particular RC Program whose investment products are best suited not only to their financial interests, but also to their immigration desires. This array of active RC Programs has demonstrated to potential investors that the USCIS' RC Program is not going away; and moreover, that the USCIS and FTIRCP are seriously committed to making RC Programs a viable path both for emigration and positive large scale pooled capital investment and job creation in the U.S.

5. Even in the face of rapidly increasing numbers of RC Programs affiliated I-526 petitions, USCIS appears to be committed to diligently work towards their goal of adjudicating all I-526 petitions within 3 months. Hopefully, the significant increase in filing fees for I-526 and I-829 petitions will lead to an increase in both support and numbers with respect to the specialized professional staff of Adjudications Officers within USCIS now required to handle the steady and rapidly growing number of RC Program petitions and related applications being filed.

Comparing E-2 and EB-5 visas:

1. Korean investors and their spouses who often invest in E-2 businesses are now realizing that most E-2 businesses not only involve a significant amount of risk, but also that their purchase price for successful E-2 businesses often approaches $500,000 US dollars. For this same amount of money, it often seems sensible to invest in an RC Program instead, especially if their children are nearing the age of 21 years old.

2. The E-2 visa is a nonimmigrant visa, and thus, does not lead to permanent resident status. Despite the fact that EB-5 principal applicants must also first go through a conditional green card status, EB-5 visas allow one to eventually obtain status as a permanent resident. An increasing number of Korean investors now recognize the value of obtaining an EB-5 visa rather than an E-2 visa in order to be eligible for permanent green cards.

3. There has been a significant back-log in labor certification based avenues for emigration - for example, Third Preference EB-based (skilled and unskilled) methods. However, due to the laudable efforts by USCIS examiners and Regional Centers to adjudicate I-526 petitions, participation in an RC Program is one of the fastest methods through which one may emigrate to the United States, even though one has to go through the conditional period first.

4. More Korean investors are realizing that it can be extremely difficult to find suitable E-2 businesses. The daily, direct operation of E-2 businesses in the United States is far more demanding than participation in an RC Program, which allows for policy involvement as an investor in a limited partnership or limited liability corporation that are owned by a group of investors who have pooled their capital, but whose detailed day-to-day operations are managed by commercial enterprises or other entities.

5. Many Korean investors realize that their children will not qualify for E-2 visas once they turn 21 years old, whereas for RC Programs and with EB-5 visas in general, children qualify for green cards as long as I-526 petitions are filed with USCIS before they reach 21 years of age.

Finally, as is the case in many other countries, the Korean currency (Won) has appreciated significantly against the US dollar , making the $500,000 USD required for TEA-based projects to be within the reach of more Korean investors. [4] In fact, countries where RC Programs are popular are often those whose currencies have appreciated significantly against the U.S. dollar over the years, for example China, England, Korea and Taiwan.

In conclusion, there has been a gradual shift in thinking among potential EB-5 clients in Korea, as well as in other countries. In the past, potential clients were wary of the uncertainty of the EB-5 Program and its relatively untested track record. Although there still remains a certain amount of caution by potential investors, as more Koreans become aware of the consistent and reasonable adjudications of EB-5 petitions filed through RC Programs, it appears that the RC Program may have finally found the necessary footing to become the kind of expansive and economically effective program it was originally intended to be.


1 As of July 2007, at least 16 RC Programs have been designated as Regional Center Programs by USCIS. Descriptions of most of these Regional Centers may be obtained from the document "Currently Active Regional Centers (March 30, 2007)" cited in "AILA Infonet Doc No. 07052167 (May 21, 2007)".

2 To date, most I-526 petitions for RC Programs have been adjudicated in less than 3 months.

3 For a detailed description of the functions and structure of FTIRCP, refer to the AILA InfoNet Doc. No. 07052167 (May. 21, 2007) titled "USCIS EB-5 Overview".

4 Just 4 years ago the Korean Won was at over 1250 Won per 1 USD, but the exchange rate is now 930 Won to 1 USD. Said author would not be surprised if the rate drops to below 900 Won to 1 USD in near future.

About The Author

Young H. Noh is an expat U.S. attorney working and residing in Korea. He is co-author of the Chapter on American Embassy in Seoul in Visa Processing Guide published annually by AILA. Young Noh represents Korean individual and corporate clients with their immigration and visa cases, including EB-5 and E-2 cases; and also works with Korean-licensed attorneys to represent non-Korean clients with business and litigation cases involving Korean law. Mr. Noh can be reached at: He is also bilingual and the founder of containing useful information about Korean law in English language.

The opinions expressed in this article do not necessarily reflect the opinion of ILW.COM.