Articles Posted in start-up companies

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On September 19, 2017, the American Immigration Council in cooperation with Mayer Brown LLP, filed a lawsuit in federal district court on behalf of the National Venture Capital Association (National Venture Capital Association, et.al. v. Duke, et. al.) challenging the President’s postponement of the International Entrepreneur Rule. The Plaintiffs in the lawsuit collectively argue that the United States Department of Homeland Security (DHS), unlawfully delayed enforcement of the International Entrepreneur Rule by circumventing key provisions of the Administrative Procedure Act.

In order for a federal rule to become effective, the Act requires federal agencies to abide by a notice-and-comment rule making procedure, a process by which the government invites the public to comment on a proposed version of a government rule published in the Federal Register. After the comment period has ended, the government responds to comments, considers feedback, and decides whether such feedback will have any influence on the content of the rules. The Supreme Court has ruled that the notice-and-comment procedure is required for “legislative” or “substantive” rules that intend to “bind” the public, and that similar to a statute, these types of rules have the “force and effect” of law. The notice-and-comment rule making requirement, however does not apply to interpretive rules, which are rules that do not bind the public or have the “force” of law in the same way that legislative or substantive rules do. The National Venture Capital Association argues that the government unlawfully invoked the “good cause” exception of the APA to postpone the Rule, and that the Rule was unlawfully halted under the pretext that doing so would prevent harm to the public interest, when no emergency situation existed which would allow such a delay.

The International Entrepreneur Rule was first published in the Federal Register on January 17, 2017, and the notice-and-comment period was set to begin 30 days from the date of the rule’s publication in the federal register. However, the government never announced a comment period for the Rule. On July 13, 2017, the Department of Homeland Security announced that the implementation of the rule would be delayed to March 14, 2018, at which time the government would seek comments from the public, with a plan to rescind the rule.

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On April 18, 2017, the President signed the controversial executive order, Hire American, Buy American, “in order to promote the proper functioning of the H-1B visa program.”

The President’s executive order directs the heads of various departments to suggest reforms to the H-1B visa worker program, a lottery based work visa program reserved only for professionals working in specialty occupations. The EO specifically aims to “ensure that H-1B visas are awarded to the most-skilled or highest-paid petition beneficiaries.”

Since the President signed the executive order, no reforms or regulations have been passed by Congress to enforce the provisions of the order on the H-1B visa worker program, however enforcement of the provisions of the executive order are beginning to be seen through the adjudicatory measures of USCIS immigration officials.

As of late, the United States Citizenship and Immigration Services (USCIS) has become a lot tougher in adjudicating H-1B visa applications. This means that securing an H-1B work visa will become a lot more difficult going forward. For the last few months, USCIS has been aggressively issuing more numerous and more stringent “requests for evidence” in comparison to previous years. This phenomenon has manifested itself generally in response to work visa applications for highly skilled workers, and is not just reserved to H-1B work visa applications.

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It’s official. The Department of Homeland Security has rolled out a plan to delay the effective date of the International Entrepreneur Rule, which was set to be enforced on July 17, 2017, to March 14, 2018, at which time the Department will seek comments from the public to rescind the rule, in accordance with Executive Order 13767, “Border Security and Immigration Enforcement Improvements” signed by President Trump on January 25, 2017.

Written comments from the public are due on or before 30 days from the date of publication in the federal register. It is strongly advised that all affected foreign entrepreneurs, business owners, attorneys, immigration advocates etc. leave a public comment identified by DHS Docket No. USCIS-2015-0006, online or by mail detailing the adverse effect that rescinding the rule would have on the U.S. economy and the expansion of jobs in the United States.

Public Comments

Online: Federal eRulemaking Portal: http://www.regulations.gov. Follow the website instructions for submitting comments.

This document is scheduled to be published in the Federal Register on 07/11/2017 and available online at https://federalregister.gov/d/2017-14619, and on FDsys.gov

By Mail: You may submit comments directly to U.S. Citizenship and Immigration Services (USCIS) by sending correspondence to Samantha Deshommes, Chief, Regulatory Coordination Division, Office of Policy and Strategy, UCSIS, DHS, 20 Massachusetts Avenue, NW, Washington, DC 20529. Remember to reference DHS Docket No. USCIS-2015-0006 in all mail correspondence.

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7541767406_8bf4575705_zNew developments have recently emerged regarding the Trump administration’s decision to dramatically scale back or rescind the International Entrepreneur Rule, passed under former President Barack Obama, a rule that would have made it easier for eligible start-up entrepreneurs to obtain temporary permission to enter the United States for a period of 30 months, through a process known as “parole,” for the purpose of starting or scaling their start-up business enterprise in the United States. International entrepreneurs would have been able to apply for this benefit beginning July 17, 2017.

However, this may all change in the coming days. The San Francisco Chronicle has reported that the Trump administration plans to undo the International Entrepreneur rule, to prevent foreign entrepreneurs from coming into the United States and starting their companies. This comes as part of President Trump’s commitment to “buy American, and hire American,” and his promise to create more jobs in the United States, by encouraging American companies to expand within the United States. All of this unfortunately comes as no surprise. It is no secret that the President has consistently expressed his anti-immigrant sentiment through his immigration policies and executive orders.

An administration official has come forward on condition of anonymity disclosing that the Trump administration plans to push back the rule’s effective date from July 17, 2017 to March 2018, to give the administration enough time to dramatically scale back the rule or get rid of the rule altogether.

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With the H-1B season quickly coming to a close, we are happy to announce that 83% of our clients were selected in this year’s master’s cap, while 56.67% of our clients were selected in the “general cap.” These estimates are above the national average. Of the petitions that were selected, the majority were filed with the California Service Center. Selections in this year’s lottery were made up until the very last minute. This fiscal year, USCIS received a total of 199,000 petitions, less than usual, and the computer-generated lottery was conducted on April 11, 2017 a bit later than usual given that the filing period opened on April 3, 2017. As in previous years, USCIS first began the selection process for the advanced degree exemption or “master’s cap,” and then proceeded with the selection process for the “general cap” to fill the 85,000-visa cap. During FY 2017, USCIS received over 236,000 petitions during the filing period which opened on April 1, 2016, and the computer-generated lottery was conducted on April 9, 2016.

USCIS has now completed data entry for all cap-subject petitions selected during fiscal year 2018. This means that USCIS will now begin the process of returning all H-1B cap-subject petitions that were not selected in this year’s lottery, along with their filing fees. While USCIS has indicated that they cannot provide a definite time frame as to when these unselected petitions will be returned, in previous years unselected petitions have traditionally been returned during mid-June to the end of June.

If you have not received a receipt notice in the mail notifying you of your selection, and your checks were not cashed by the Department of Homeland Security, between April 1st and May 3rd., unfortunately it is not likely that you were selected in this year’s lottery. For safe measure, applicants may wish to wait about a week or so to see if any late notices are received.

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On Friday April 7, 2017, the United States Citizenship and Immigration Services (USCIS) announced that it has received more than enough H-1B petitions for fiscal year 2018, to meet the general cap, which allocates 65,000 visa applications to H-1B beneficiaries possessing a U.S. bachelor’s degree or its equivalent. In addition, USCIS announced that it has received more than the 20,000 visa applications necessary to count toward the U.S. advanced degree exemption for beneficiaries possessing a U.S. master’s degree or higher. This announcement has traditionally been made on April 7th each fiscal year. USCIS has not yet announced whether the randomized lottery has already occurred to select the necessary petitions to meet the general cap and master’s cap. Last H-1B season, USCIS conducted the randomized computer-generated lottery on April 9th therefore the announcement will be imminent.

How does the lottery work?

USCIS will first begin the selection process for the 20,000 available visas that will count toward the advanced degree exemption or master’s cap. Then, unselected advanced degree petitions that were not selected in the first round, will be placed in the lottery toward the general 65,000 visa cap giving these individuals a second chance of being selected.

Chances of selection

This year our office estimated that individuals who applied for the advanced degree exemption (U.S. master’s or higher) will have roughly a 65-70% chance of selection, while applicants for the general cap will have roughly a 35-40% chance of selection.

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On March 31, 2017, the United States Citizenship and Immigration Services (USCIS) issued a new policy memorandum providing new guidance relating to the adjudication of H-1B petitions for computer programmers. The new memorandum will supersede and replace the policy memorandum that had been in place since the year 2000, which previously governed adjudication procedures for H-1B computer related occupations.

The new memorandum seeks to update the outdated provisions of the 2000 memorandum because the policies set out in that memorandum no longer reflect the current policies of the agency. The main purpose for rescinding the 2000 memorandum is not to change the H-1B application process for employers who seek to employ foreign workers in computer related occupations, rather the new memorandum clarifies the proper adjudication procedures for computer related occupations at all service centers.

Why the Change?

The Occupational Outlook Handbook is a handbook published by the Department of Labor’s Bureau of Labor Statistics which includes information relating to the training and education required for various employment positions. The OOH is of particular importance for H-1B petitioners and practicing attorneys, because USCIS consults the OOH as a guide to inform their decision regarding the general qualifications necessary for a particular occupation, and whether the occupation is to be considered a “specialty occupation.” The OOH however does not on its own establish whether a position is a “specialty occupation,” rather adjudicating officers focus on the position itself and the job duties and qualifications of the beneficiary, to determine whether the position is to be considered a specialty occupation.

The main problem with the 2000 policy memorandum was that it relied on an outdated OOH description of the position of “computer programmer,” creating inconsistencies that are no longer followed by adjudicating officers today.

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Beginning April 3, 2017, the United States Citizenship and Immigration Services (USCIS) will temporarily suspend expedited processing of H-1B visas, a service previously available to H-1B petitioners known as premium processing. The reason: to reduce overall H-1B processing times and prioritize processing of H-1B extensions nearing the 240-day mark. Premium processing previously guaranteed a 15-day processing time, or refund of the $1,225 premium processing fee. Although premium processing did not increase a petition’s chances of being selected for an H-1B visa, it gave petitioners the benefit of waiting a shorter period and allowed selected petitioners the option of upgrading their application to premium processing after filing.

Petitioners will not have the option of paying for the premium processing service for a period of at least 6 months beginning April 3, 2017. The suspension will affect all H-1B petitions filed on or after April 3, 2017 including all petitions filed for the FY18 H-1B regular cap and master’s advanced degree cap exemption. Additionally, the suspension may affect petitions that are cap-exempt, but will not apply to other eligible nonimmigrant classifications filed with Form I-129.  While the premium processing service is suspended, petitioners may not file a request for premium processing (I-907) for an I-129 Petition for H-1B worker until USCIS has announced that it has resumed premium processing for H-1B petitions. Beginning April 3, 2017 if a petitioner submits a single check combining fees for premium processing and the Form I-129 USCIS will reject both applications (not just the request for premium processing). To avoid this DO NOT submit any premium processing requests on or after April 3, 2017.

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It is our pleasure to announce that USCIS has now published the Final International Entrepreneur Rule in the federal register. The final rule is estimated to benefit approximately 2,940 foreign entrepreneurs on an annual basis beginning July 17, 2017. The rule will make it easier for eligible start-up entrepreneurs to obtain temporary permission to enter the United States for a period of 30 months, or 2.5 years, through a process known as “parole,” for the purpose of starting or scaling their start-up business enterprise in the United States. The foreign entrepreneur’s stay may be extended for an additional 30 months to allow the entrepreneur to continue to oversee and grow their start-up company in the United States. The decision about whether to “parole” a foreign entrepreneur under this rule will be a discretionary determination made by the Secretary of Homeland Security on a case-by-case basis (INA Section 212(d)(5), 8 U.S.C. 1182(d)(5)).

The goal of this final rule is to encourage foreign entrepreneurs to create and develop start-up companies with high potential for success in the United States, and enhance economic growth through increased capital spending and job creation.  Under this rule “parole” will be granted to eligible entrepreneurs who can demonstrate that their company’s business operations are of significant public benefit to the United States by providing evidence of substantial and demonstrated potential for rapid business growth and job creation. Such demonstrated potential for rapid growth and job creation may be evidenced by: (1) significant capital investment from U.S. investors with established records of successful investments or (2) attainment of significant awards or grants from certain Federal, State, or local government entities.

The final rule will allow up to three entrepreneurs to seek “parole” per-start up entity, as well as their spouses and children. Entrepreneurs who qualify for “parole” may only work for their start-up business entity in the United States. Their spouses in turn will be eligible to apply for employment authorization once in the United States.

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The H-1B visa is one of the most coveted visas in the United States for several reasons. One of the biggest perks of the H-1B visa is that it is granted for a period of three years, and can be extended for an additional three years. Recipients of the H-1B visa can also bring their dependents to live with them in the United States on an H-4 visa. The H-1B visa is also a popular option because it gives workers the flexibility of accepting and entering new employment, made possible by the portability provision of the H-1B program (8 U.S.C. § 1184(n)). The portability provision allows an H-1B worker to change jobs without having to risk falling “out of status.” Recently, USCIS also improved its portability provision with the passage of a new law that will give H-1B workers who have been laid off a 60-day grace period to transfer to a new employer. But perhaps the greatest upside to the H-1B visa however, is that it is one of the few visas that allows a nonimmigrant to apply for permanent residency as a beneficiary of an immigrant visa petition, without the immigrant petition having any negative affect on their H-1B status. This privilege is recognized in the law and is known as “dual intent.” Foreign nationals holding a “dual intent” visa such as an H-1B visa are allowed to file a green card petition, while continuing employment under the terms of their visa, and may also travel on their visa without seeking permission from USCIS.

In this sense, the H-1B visa is one of the few visas that opens a direct path to permanent residency. Other popular employment visas such as the E-2 treaty investor visa do not create a direct path to permanent residency and are not considered “dual intent” visas.

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