While Congress has just substantially revived the EB-5 program for immigrant investors, authorities on the other side of the Atlantic are heading in the other direction because of the Russian invasion of Ukraine.
The European Commission (the governing body of the European Union) is urging the nations of Europe to repeal what are called “golden parachute” programs, according to an article in the Washington Post. These programs allow foreigners to obtain legal status in return for substantial investments; many European states have such programs, but they are regarded by the Commission as giving legal status to Russian oligarchs, among others.
According to an article in Fortune, the UK terminated its program along these lines several weeks ago, because of the invasion.
Similarly, in Bulgaria — whose offer to aliens includes full citizenship — the government has put forward a draft law that would kill the program, while Cyprus (often an objective of oligarch attention) says it is only processing applications filed before November 2020.
Generally, Russians have shown more interest in European programs than in our EB-5 arrangement. According to Fortune, there were 59 Russian applications to the American program in FY 2019. Looking at more recent State Department reports than those read by the magazine, we find that Russian filings, like those globally, fell to 36 in FY 2020 and to eight in FY 2021. Since there are usually about 2.5 visas issued per investment, that means in the most recent period all of three Russian investors chose the American program.
In contrast to those low numbers, the E.U. has published data showing 130,000 people from various nations bought into the European programs between 2011 and 2019.
The European Commission suggested that nations consider stripping golden parachute benefits from the oligarchs. I doubt that would be possible under U.S. law.
Meanwhile, back in the States, a small controversy has erupted in Florida about the program. There have been reports that Governor Ron DeSantis, who shows a commendable interest in enforcing the immigration law, was invited to speak at an EB-5 conference in Miami — and that the invitation was subsequently withdrawn by the conference sponsors because of his views.
The governor’s office says that it has no record of an invitation offered or withdrawn.
Governors play absolutely no role in the EB-5 program, so this is no more than a symbolic gesture on the part of the industry. But stiffing a governor is an unusual event.
The author is grateful to Matthew Bonness for the Florida information.