The new parole announcement is called the “International Entrepreneur Rule.” It won’t be effective for at least 45 days (to give the public time to comment on it). The change would include an amendment to the Code of Federal Regulations section interpreting INA 212(d)(5) to provide a “transparent framework” for the exercise of agency discretion and the case-by-case adjudication of parole requests for start-up entrepreneurs.
What Does the “International Entrepreneur Rule” Do?
In order to be apply for parole under the International Entrepreneur Rule, an immigrant entrepreneur would be required to:
- Own at least 15 percent of the startup and be actively involved in its operation
- Have formed the business in the United States within the previous three years.
The entrepreneur must also prove that her business has the potential for job creation and growth by showing:
- Investment of a minimum of $345,000 from qualified U.S. investors with success in prior investments;
- The receipt of significant grants or awards from federal, state, or local government entities (at least $100,000); or
- Partially satisfying one or both of these criteria plus providing “other reliable and compelling evidence of the startup entity’s substantial potential for rapid growth and job creation.”
The new regulation will be found at 8 CFR 212.19.
B. What Parole Will Look Like
Under the proposed rule, a qualifying entrepreneur may receive parole for a two-year period, and may be eligible for a three-year renewal based upon the success of the start-up.
When finalized, the proposed rule may hold some potential for immigrants who find themselves waiting in the lengthy immigrant visa backlogs, as well as people from countries that do not have E-1 or E-2 visa status such as India and Mainland China.
It also appears this Parole is going to be available to immigrants already present in the United States who may have fallen out of status. Because parole is not an “admission” it will also help people who would technically be considered “inadmissible”or ineligible for adjustment of status.
Immediately I can think of a number of cases where this new status is going to help. A few examples:
- Individuals who entered the United States as L-1A multi-national managers and may be running out of time in L-1A status.Although there is a permanent version of the multi-national manager visa, I’ve seen a number of cases where USCIS will grant L-1A status but then denies the permanent visa erroneously. If you’re in this boat and can qualify for entrepreneur parole, this might be an option.
- Individuals who entered the United States as H-1B professionals but whose employers will not be filing a permanent visa petitions. Once they reach the maximum time allowed in H-1B, some of these people may be willing to start their own companies if they’re able to get up to five years of parole in the United States.
It also appears that the spouse of an entrepreneur granted parole is going to be eligible for work authorization too.
There are a number of problems with the parole announcement, although they’re not the President’s fault.
A. Parole is Not a “Non-Immigrant Status”
Unfortunately, this status isn’t going to be all that helpful if you’re already in some other non-immigrant status or you’re hoping to eventually obtain permanent residence. This is because unless you have some other avenue to obtaining status and just need a few years of work authorization, this parole offers no mechanism for permanent residence. This is from the Federal Register:
Because all you get is parole, you technically won’t be in an “non-immigrant status.” This means changing to a different non-immigrant status when you’re finished with this parole will be difficult unless you’re willing to leave and come back. For many, that’s just not what we had in mind when we thought of a “start-up visa.”
B. Parole Does Not Make You Eligible for Adjustment of Status
Under this rule the entrepreneur would have, at most, five years to get the business running and then would have to leave. I can envision some people leaving and coming back as an E-2 treaty trader (if you’re from a treaty country) or perhaps becoming eligible for an EB-5 if they’ve invested enough of their own money.
But if you haven’t, at the end of five years there is no option to make this visa permanent. Some entrepreneurs may have gotten married in the United States in those five years or have adult children or other family who can file for them. For those who do not, this is not a permanent option.
Let’s say, for example, you’re already in H-1B status with an approved I-140 visa petition but you’re waiting for ten or more years on visa numbers. Last year’s visa bulletin updates didn’t offer much help. So maybe you’re thinking of jumping ship and applying for entrepreneur parole. The biggest drawback I see is that once your H-1B expires and you’re in “parole” you may have a hard time getting back into a non-immigrant status without leaving the United States first, and you will have given up on the approved I-140 that would eventually make you eligible for adjustment of status.
My hunch is that most people in a job they can at least tolerate aren’t going to jump ship.
We still need a start-up visa. I’m sorry to be so negative because this is a much-needed and highly anticipated change. My frustration is aimed not at the President but at Congress. The President can’t create a new start-up visa. Only Congress can. It’s clear the President is trying very hard to keep this proposal within his Executive power and not to overreach.
The biggest losers from the lack of a start-up visa are immigrant entrepreneurs and the U.S. economy. In the interim, we will keep reading this final rule and looking for ways to use it to help individuals looking to start businesses and create jobs in the United States.
What do you think of the entrepreneur program? Leave your thoughts in the comments.