US Citizenship and Immigration Services (“USCIS”) has today published a proposed rule in the Federal Register seeing to revoke the Obama-Era International Entrepreneur Rule (or “IER). The move has long been expected; this administration has sought to thwart the rule at every turn and has long said this revocation regulation was coming.
The IER sought to provide a solution for those coming to the US to start new companies – a demographic which enormously benefits the US economy in terms of job creation and technical leadership, but for which current nonimmigrant visas are often an imperfect fit. Since a new statute would be required to create a new nonimmigrant visa, and congress has been gridlocked for many, many years on any kind of immigration reform, the IER sought to use the parole authority of the executive branch to admit entrepreneurs for this limited purpose, for a limited period of time.
The rule has proven to be of questionable utility. To qualify, an applicant must have at least 10 percent ownership in a company created within the last five years and a central role in the operations of that startup; so far, most startup founders would likely qualify. However, applicants must also show that their company has “substantial and demonstrated potential for rapid business growth and job creation” — here meaning they must have either garnered investments of at least $250,000 from qualified American investors or received $100,000 worth of federal, state or local grants. This wasn’t an easy requirement to meet for many early-stage startups; often the visa was needed to that founders could fundraise and so get to this point.
Further, the reluctance of the administration to implement the rule has caused too much uncertainty for most founders to consider relying upon it for the ability to start or continue running their companies. USCIS did not initially put procedures in place to accept and process applications under the rule. After a lawsuit, USCIS was forced to begin accepting applications – only to publish this revocation rule.
There is now a 30-day comment period before the agency reviews comments and most likely publishes a final rule withdrawing the IER.