EB-5 Reform on the Horizon – If the Palm House Hotel Debacle Does Not Precipitate Congressional Action, What Will?

March 22, 2019

Download: EB-5_Reform_on_the_Horizon_-_If_the_Palm_House_Hotel_Debacle_Does_Not_Precipiate_Congressional_Action__What_Will.pdf

Many EB-5 stakeholders predict that the recent advance of the controversial “TEA” regulations to the final review stage at OMB indicates that these regulations will be imminently released. They also contend that Congress would promptly enact legislative “reform” to counter the effect of these regulations, especially the increase in the minimum investment amounts. As explained below, we are highly skeptical that the regulations5 will be finalized in the foreseeable future; instead, we believe they will continue to wallow in regulatory limbo while OMB exercises its discretion as empowered by Executive Order 12866.

The political agenda of those who make these predictions is obvious. Repeatedly, EB-5 proponents intentionally mischaracterize the regulations as “Obama-era” regulations. However, there is no evidence that the reform of the EB-5 Program (the “Program”) or the elimination of TEA abuse was a priority, or even a focus, of President Obama. If the regulations should be labeled, the “Grassley-era regulations” would be more appropriate. As the industry is well aware, then Chairman of the Senate Judiciary Committee, Charles Grassley (R-IA), an ardent supporter of President Trump and a foe of President Obama, was the driving force behind these regulations. 

Securities Disclaimer

This website is for informational purposes only and does not constitute an offer or solicitation to sell shares or securities. Any such offer or solicitation will be made only by means of an investment's confidential Offering Memorandum and in accordance with the terms of all applicable securities and other laws. This website does not constitute or form part of, and should not be construed as, any offer for sale or subscription of, or any invitation to offer to buy or subscribe for, any securities, nor should it or any part of it form the basis of, or be relied on in any connection with, any contract or commitment whatsoever. EB5Projects.com LLC and its affiliates expressly disclaim any and all responsibility for any direct or consequential loss or damage of any kind whatsoever arising directly or indirectly from: (i) reliance on any information contained in the website, (ii) any error, omission or inaccuracy in any such information or (iii) any action resulting therefrom.