A blog about U.S. immigration matters by Paul Szeto, a former INS attorney and an experienced immigration lawyer. We serve clients in all U.S. states and overseas countries. (All information is not legal advice and is subject to change without prior notice.)

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Monday, May 10, 2021

The US will continue admitting startup entrepreneurs - an alternative to H-1B


The Biden Administration has announced that it will continue to receive applications for startup entrepreneurs to be paroled into the United States by withdrawing a 2018 notice of proposed rulemaking.  That notice proposed to remove the International Entrepreneur program from DHS regulations.

For those aspiring entrepreneurs who failed to be selected in the H-1B CAP drawing, the International Entrepreneur Rule may be a viable alternative for them to continue working and running their business in the United States. 

The International Entrepreneur Rule (IER) was created by the Obama Administration to provide another way for foreign entrepreneurs to invest and establish new businesses in the U.S. Slated to take effect on July 17, 2017 originally, the IER's implementation was halted and suspended by the Trump Administration at the last minute.  The delay and suspension was challenged by a group of the nation's venture capitalists in federal court.  On December 1, 2017, the U.S. District Court for the District of Columbia in National Venture Capital Association v. Duke vacated DHS' final rule to delay the implementation of the IER.  Biden Administration today has formally revived the program. 

Overseas entrepreneurs may continue file petitions to request parole status to enter the U.S. to establish and manage businesses, according to a recent announcement of USCIS.  Upon approval of their petitions, their spouses and children may also enter the U.S.  Further, their spouses may also apply for permission to work in the U.S.  

Under the IER, eligible startup entrepreneurs include those:

(1) Who have a significant ownership interest in the startup (at least 10 percent) and have an active and central role to its operations;

(2) Whose startup was formed in the United States within the past five years; and

(3) Whose startup has substantial and demonstrated potential for rapid business growth and job creation, as evidenced by proof of significant private financial investments ($250,000 or more) by U.S. citizens, legal residents or entities, or government grants and awards ($10,000 or more) duirng the preceding 18 months.  

Regarding item# above, applicants may also provide other compelling evidence too prove the potential of the startup if private investments and government grants received are less than the above thresholds. 

Each startup entity may petition up to three entrepreneurs for parole status for up to five years.  Their spouses and children under 21 may also be paroled into the United States.  Spouses will be allowed to apply for employment authorization and children will be allowed to attend public schools.

Details of the application process and requirements will be released soon.  Stay tuned for more details regarding this parole rule for entrepreneurs.






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