Long Awaited International Entrepreneur Rule to be Released for Comment

By: Vishal Chander

In what will perhaps be the final immigration action taken during the Obama presidency, the Department of Homeland Security released the long awaited proposed rules entitled International Entrepreneur Rule.

The proposed rule would add new regulatory provisions guiding the use of parole on a case-by-case basis with respect to entrepreneurs of start-up entities whose entry into the United States would provide a significant public benefit through the substantial and demonstrated potential for rapid business growth and job creation.

The proposed rule would be contained at 8 CFR 212.9 and would provide the following:

 

1. Formation of a New Start-Up Entity.  The applicant has formed a new entity in the United States within 3 years of the parole application and the business has substantial potential for rapid growth and job creation.
2. Applicant is an Entrepreneur.  Entrepreneur is well positioned to advance the entities business and provides evidence:
1. Possesses significant (at least 15%) ownership interest at the time of parole
2. Active and central role in the operations and future growth of the entity such that her knowledge, skills, or experience substantially assist the entity in conducting and growing its business in the United States.
3. Significant U.S. Capital Investment or Government Funding.  The applicant can validate substantial potential growth and job creation through proof of the receipt of significant capital from qualified U.S. investors with established records of successful investments.
1. Receipt of capital totaling $345,000 or more from established U.S. investors with a history of substantial investment in successful start-up entities (venture capital firms, angel investors, start-up accelerators).
2. Government Grants.  Proof of significant awards of grants from Federal, State, or local government entities with expertise in economic development, research and development, and/or job creation equality $100,000 or more.
3. Alternative Criteria.  Alternative criteria under which an applicant who partially meets one or more of the above sub-criteria related to capital investment or government funding may be considered for parole under this rule if he or she provides additional reliable and compelling evidence that his or her entry would provide a significant public benefit to the United States. Such evidence would need to serve as a compelling validation of the entity’s substantial potential for rapid growth and job creation.

The applicant, spouse, and unmarried minor children may be considered for a discretionary grant of up to 2 years based on the significant public benefit that would be provided by the applicant’s parole into the United States.  The application would require payment of a fee and taking of biometrics.  No more than three entrepreneurs may receive parole for any one qualifying entity.  To be granted parole, USCIS adjudicators must find, based on the totality of the circumstances, 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 entrepreneur would be authorized for employment incident to the grant of parole, but only with respect to the entrepreneur’s start-up entity. The entrepreneur’s spouse, if paroled into the United States pursuant to 8 CFR 212.19, would be permitted to apply for employment authorization consistent with another proposed regulation.

The proposed rule allows for reparole for an additional period of up to 3 years if, and only if, it can be demonstrated that entrepreneur entity has shown signs of significant growth since the initial grant of parole and such entities continue to have substantial potential for rapid growth and job creation. The following factors would be considered for a discretionary grant of an additional period of parole:

 

1. Investments from established U.S. investors. Proof that during the the start-up entity received additional substantial investments of capital of at least $500,000 during the initial parole period from qualified U.S. investors (such as venture capital firms, angel investors, or start-up accelerators) with a history of substantial investment in successful start-up entities or government awards or grants from Federal, State or local government entities with expertisein economic development, research and development, and/or job creation.

2. Revenue generation. Proof that the start-up entity has generated substantial and rapidly increasing revenue in the United States during the initial parole period by reaching at least $500,000 in annual revenue, with average annualized revenue growth of at least 20 percent, during the initial parole period.

3. Job creation. Proof of substantial job creation in the United States during the initial parole period through the creation of at least 10 full-time jobs for U.S. workers during the initial parole period.

4. Alternative criteria. Alternative proof which shows applicant partially meets one or more of the above sub-criteria related to capital investment, revenue generation, or job creation may be considered.

The proposed rules were issued in response to Executive Actions announced by President Obama in November of 2014.  Because of the commentary and notice period, it is likely the implementation of any rule would occur in the final days of the Obama presidency or after.  The rule is issued pursuant to INA §212(d)(5)  which authorizes the government to discretion to temporarily parole a foreign national into the United States on a case-by-case basis for urgent humanitarian reasons or significant public benefit.

The entire text of the unpublished proposed regulation is available at: https://www.uscis.gov/sites/default/files/USCIS/Laws/Articles/FR_2016-20663_793250_OFR.pdf

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