DHS Proposes Rule That Would Expand Immigration Options for Certain Foreign Entrepreneurs

On August 26, 2016, the U.S. Department of Homeland Security (DHS) revealed an advance copy of its notice of proposed rulemaking, entitled “International Entrepreneur Rule.”  This rule follow President Obama’s promise in November 2014 to use existing statutory authority to leverage current immigration law to encourage entrepreneurship and economic growth. This is only a proposed rule, which has not yet been implemented and may not be enforced until it is final. It remains to be seen whether the rule can be implemented before the Presidential Election and, if so, whether the outcome of the Election will have any impact on the proposal. DHS is not currently accepting applications under the proposed rule. If and when the rule becomes final, it would expand immigration options for entrepreneurs who meet certain criteria for creating jobs, attracting investment and generating revenue in the United States.  Note that the rule may change significantly following the 45-day public comment period. Not all proposed rules become final.

The proposed rule would allow DHS to use existing discretionary statutory parole authority for entrepreneurs of start-up entities whose stay in the United States would provide a significant public benefit through the substantial and demonstrated potential for rapid business growth and job creation. Under this proposed rule, DHS may parole, on a case-by-case basis, eligible entrepreneurs of start-up enterprises:

  1. Who have a significant ownership interest in the start-up (at least 15 percent) and have an active and central role to this operation;
  2. Whose start-up was formed in the United States within the past three years; and
  3. Whose start-up has substantial and demonstrated potential for rapid business growth and job creation, as evidenced by:
  • Receiving significant investment of capital (at least $345,000) from certain qualified U.S. investors (such as venture capital firms, angel investors, or start-up accelerators) with established records of successful investments;
  • Receiving significant awards or grants (at least $100,000) from certain federal, state or local government entities; or
  • Partially satisfying one or both of the above criteria in addition to other reliable and compelling evidence of the startup entity’s substantial potential for rapid growth and job creation.

Under the proposed rule, USCIS adjudicators would be required to consider the totality of the evidence to determine that both (1) the applicant’s parole would provide a significant public benefit; and (2) the applicant merits a grant of parole as a matter of discretion. The proposed rule lists examples of evidence that may be required to meet the above criteria.

The proposed rule states that an application for parole would be filed on Form I-941, Application for Entrepreneur Parole (or a successor form), with a proposed application fee of $1,200 and an additional biometrics fee required for a background check to be conducted. Note that the government is not currently accepting any applications or fees for entrepreneur parole.

Under the proposed rule, entrepreneurs (and their spouses and minor, unmarried children) would be granted an initial stay of up to two years to oversee and grow their start-up entities in the United States. A subsequent request for re-parole (for up to three additional years) would be considered only if the entrepreneur and the start-up entity continue to provide significant public benefit as evidenced by substantial increases in capital investment, revenue or job creation. Under the proposed rule, no more than three entrepreneurs may receive parole with respect to any one qualifying entity.

Under the proposed rule, entrepreneurs who receive parole would be granted employment authorization incident to status (but only with respect to the qualifying start-up entity) and will not need to apply for a separate Employment Authorization Document (EAD) following their entry to the United States. DHS is proposing to extend eligibility for employment authorization to the accompanying spouses, which would require that the spouse apply for an unrestricted EAD after arriving in the United States.

DHS believes that the proposed rule would encourage foreign entrepreneurs to create and develop start-up entities with high growth potential in the United States, which are expected to facilitate research and development in the country, create jobs for United States workers, and otherwise benefit the United States economy through increased business activity, innovation and dynamism.

Once published in the Federal Register, the public will have 45 days to comment, after which U.S. Citizenship and Immigration Services (USCIS) will review comments and work on finalizing the rule. Foreign national entrepreneurs should follow the government’s official updates regarding the status of the proposed rule in order to avoid scams.

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