On January 17, with three more days before the new administration takes office, the Obama administration Department of Homeland Security (DHS) published a final rule intended to assist immigrant entrepreneurs to come to the US to grow their business.
To be eligible under the new rule, an entrepreneur would need to show that:
The applicant possesses a substantial ownership interest in a start-up entity created within the past five years in the United States that has substantial potential for rapid growth and job creation.
The applicant has a central and active role in the start-up entity such that the applicant is well-positioned to substantially assist with the growth and success of the business.
The applicant can prove that his or her stay will provide a significant public benefit to the United States based on the applicant’s role as an entrepreneur of the start-up entity by:
Showing that the start-up entity has received a significant investment of capital from certain qualified U.S. investors with established records of successful investments;
Showing that the start-up entity has received significant awards or grants for economic development, research and development, or job creation (or other types of grants or awards typically given to start-up entities) from federal, state or local government entities that regularly provide such awards or grants to start-up entities; or
Showing that they partially meet either or both of the previous two requirements and providing additional reliable and compelling evidence of the start-up entity’s substantial potential for rapid growth and job creation.
It’s important to note what this rule isn’t as well as what it is:
It isn’t a universal immigration fix for all entrepreneurs. We don’t know what some of the terms here will be interpreted to mean. For instance: “potential for rapid growth and rapid job creation” – for some businesses, the growth goals are oriented towards growing user base more than growing revenue – will this still count? How much must a US investor put in to be considered “significant,” and how much of an “established record” of successful investment” is needed (not to mention, what must the return be to be considered “successful”)?
It isn’t a new non-immigrant [temporary] or immigrant [permanent] visa category (so it isn’t correct to call this a “startup visa”). Rather, it allows use of the existing authority to grant “parole” – a temporary period of admission to the US, limited here to and initial 30 months – to entrepreneurs in certain specific (and somewhat limited) circumstances.
It isn’t a solution for all founders when there are many involved, or an immigration solution for all early non-US hires. Unlike a nonimmigrant visa permitting employment, which generally don’t have limitations on how many individuals can get the same visa type for the same company, only three individuals can get this type of parole for any one company.
It also isn’t immediately available: this rule is slated to become effective on July 17, 2017 180 days after the publication date (of course, the incoming administration may use that time to withdraw the rule or otherwise halt implementation.
There are some similarities to existing non-immigrant visas permitting employment. Non-immigrant visas are by definition temporary and limited in duration, though many can be renewed multiple times. The parole offered here has a finite limit of 2.5 years (30 months) with only one extension permitted…and then only if certain criteria are met (it isn’t yet clear what those criteria will be).
Like most nonimmigrant visa permitting employment, it’s employer-specific – it thus ties the entrepreneur to the startup which formed the basis for the parole application.
Also, it allows for spouses and minor children to accompany the entrepreneur, with employment authorization permitted for spouses much as it is for spouses in some nonimmigrant categories such as L-1 and E-2.
The new rule holds promise, but we’ll need to learn much more about how implementation will be handled (and whether the new administration will even keep the rule) to see how useful it will be.