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Executive Order on Hong Kong Normalization and its Impact on the EB-5 Green Card Process for Hong Kong-born Investors

July 21, 2020

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Rahul Soni

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By: Rahul Soni

A recent Executive Order signed by President Donald Trump on Tuesday, July 14, declared that the Special Administrative Region of Hong Kong is no longer sufficiently autonomous to justify differential treatment from the People’s Republic of China. In a U.S. immigration context, nationals born in Hong Kong, as well as those who hold passports from the Special Administrative Region of Hong Kong, will be treated as nationals of the People’s Republic of China with respect to immigrant visa quotas and nonimmigrant visa validity. The Executive Order was issued in response to China’s recent national security law, also issued on July 14, to establish greater control over Hong Kong.

EB-5 Immigrant Visa Process Impact

Under the Executive Order, individuals who were born in Hong Kong and who seek permanent residence in the U.S. will be counted—or “charged”—against the immigrant visa quota for the People’s Republic of China. From a practical perspective, this means that Hong Kong nationals will be subject to the lengthy visa backlogs and wait times currently affecting most green card categories for Chinese nationals, including the EB-5 immigrant visa category. Currently, the U.S. Department of State is publishing an approximate five-year backlog for mainland China-born nationals under the EB-5 green card category from date of filing the I-526 petition. However, the current visa backlog for China may lengthen, depending on the volume of Hong Kong nationals who have applied through the EB-5 Immigrant Investor Visa Program.

On March 31, 2020, the U.S. Citizenship and Immigration Service (USCIS) also adjusted the process for adjudicating EB-5 petitions, to a visa availability approach.  This prioritizes the review and adjudication of I-526 petitions of investors whose nationalities currently have visas available. Under this approach, processing times for I-526 petitions filed by investors from countries with visa backlogs, such as China (now including Hong Kong), are expected to take longer, potentially up to five years, given the agency’s published case processing times.

The end of separate visa validity and “charge” policies for Hong Kong, coupled with USCIS’ recently revised adjudication policy, will ultimately delay Hong Kong investors’ eligibility to apply for their conditional permanent residence. It is not yet clear whether already-filed and pending EB-5 cases will be “grandfathered” under the existing law, or instead, be subject to the rules of the new Executive Order.

Practical Considerations for Hong Kong Investors

Given the extended wait times Hong Kong nationals will now face in obtaining a green card through the EB-5 Program (at least a five-year backlog), the practicality of EB-5 for Hong Kong investors is greatly diminished. For some Hong Kong investors, cross-charging (i.e., marriage to a spouse born in a non-backlogged country) will exempt the investor from the lengthy backlogs and avoid the delay altogether.  However, for those Hong Kong investors who cannot avoid the backlog, the EB-5 Program should be initiated much earlier than originally anticipated. For many EB-5 investors, the Immigrant Investor Visa Program is a pathway to obtain permanent residence for minor children, to ensure they can secure a green card by the time they reach university age.  With visa issuance backlogs, minor children risk “aging out” if any dependent children included with an EB-5 filing reaches the age of maturity (21 years, plus the I-526 petition processing time) before visa availability.  As such, initiating while any dependent children are still very young will help to ensure visa availability for those children included in an application and ultimately provide a safeguard for the family.

Further Guidance is Expected

The U.S. Departments of State and Homeland Security are expected to issue further guidance on the implementation of the Executive Order in the coming weeks. In the meantime, if you have any questions, please contact Rahul Soni at [email protected].

This blog was released on July 21, 2020 and, due to the circumstances, there are frequent changes. To keep up to date with all the latest updates on global immigration, please visit our COVID-19 microsite, subscribe to our alerts and follow us on LinkedIn.

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  • United StatesUnited States

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Porthole headshot image of Fragomen New York Associate Rahul Soni

Rahul Soni

Partner

New York, NY, United States

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[email protected]

T:+1 347 573 2996

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Related content

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Porthole headshot image of Fragomen New York Associate Rahul Soni

Rahul Soni

Partner

New York, NY, United States

Email

[email protected]

T:+1 347 573 2996

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Porthole headshot image of Fragomen New York Associate Rahul Soni

Rahul Soni

Partner

New York, NY, United States

Email

[email protected]

T:+1 347 573 2996

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