That business is already under pressure as countries such as Canada shut down programs that effectively allowed rich people to buy citizenship. China is the top source for investment-based immigration in countries such as the U.S., Canada, Australia, Cyprus and Portugal.
The deal, reached Monday between U.S. President Barack Obama and Chinese President Xi Jinping to ease visa restrictions and grant 10-year multiple-entry visas for tourists and businesspeople, will reduce demand from rich Chinese for permanent residency in the U.S.
"With a 10-year visa, some people won't bother getting a green card," said Bernard Wolfsdorf, a California-based immigration attorney at Wolfsdorf Rosenthal.
Chinese looking to buy permanent residency sometimes pay tens of thousands of dollars in fees to the agencies, which are based in China and overseas. The visa deal came as China agreed with other Asia-Pacific countries to set up a regional network to track down corrupt officials.
At the Investment Immigration Summit held in Hong Kong this week, industry executives were concerned. "People are waiting for the hammer to fall," said Jean François Harvey, the organizer and global managing partner at Harvey Law Group. "There's a lot of nervousness in China."
China is also set to cooperate with the U.S. in providing bank-account information on U.S. citizens and green card holders in China. In return, it wants to get information from the U.S. about corrupt Chinese officials who have fled to other countries.
Immigration consultants say the sons and daughters of government officials and bosses at state-owned enterprises can account for up to half of the applicants for U.S. immigration-based visa applications in places like Beijing.
In China, authorities are scrutinizing the immigration agencies that serve the rich. Several immigration lawyers in China and Hong Kong said police have visited trying to get information about their clients, though they were quick to add that they insisted on attorney-client privilege.
"There's lots of money to be made in this field," said Eugene Chow, principal at Chow King & Associates. "But you may be on the wrong side of the fence. Today's hero in China may be tomorrow's public enemy."
At the moment, demand is strong under programs that grant people visas if they make investments, buy property or just bring cash into a country. The U.S. EB-5 visa program, which allots 10,000 visas a year to foreigners who create jobs and invest at least $500,000, hit its quota in August for the first time. Waiting times have increased from a few months to two to three years.
But foreign governments are becoming more careful about the people they allow into their countries and some are expressing regrets about opening their doors to rich immigrants. "We should have insisted on a security check on every applicant, because some people are unscrupulous," said Denzil Douglas, prime minister of the Caribbean island nation of St. Kitts and Nevis, which has a popular immigration-visa program.
Canada has ended a program similar to the U.S.'s EB-5 offering, saying it didn't bring enough economic benefit and "significantly undervalued" Canadian residency.
Chinese hoping to emigrate are also realizing they may not be safe in small countries that are less likely to stand up to China. It took more than a decade for Chinese fugitive Lai Changxing to be extradited from Canada. But in Fiji, Chinese authorities working with local police went in and seized an executive suspected of running off with company money just three days after the formal start of the investigation, the Chinese government said.
For ordinary Chinese who merely want to travel, the new 10-year visas will be a game changer. Until now, they could only get visas for a maximum of one year.
The U.S. has also streamlined the visa process for Chinese. The number of Chinese who received U.S. nonimmigrant visas jumped five times from 2004 to 1.4 million in 2013. For every six nonimmigrant visas the U.S. issued globally in 2013, one was given in China, up from one in every 20 in 2004.
This easing by the U.S. may be followed by other countries such as the U.K., which has been criticized for not making things simple enough for Chinese travelers.
The long-term U.S. visas will be a boon for the travel industry. The White House expects the number of Chinese visitors to the U.S. to now quadruple to 1.8 million a year.
"With more options, wealthy Chinese are more likely to rethink the cost and benefit of a U.S. passport," said David Lesperance, a U.S. immigration lawyer at Lesperance Associates.
Source: Wall Street Journal by Wei Gu
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