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Articles Posted in start-up companies

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Are you a small business owner feeling the pinch of the Coronavirus (COVID-19) pandemic? Have no fear, the newly passed Coronavirus Aid, Relief, and Economic Security Act (CARES) provides emergency financial relief for small to mid-sized businesses in the United States, to help business owners keep employees on their payroll.

This federal relief package allocates nearly $350 billion in emergency aid for businesses through a small business loan program called the Paycheck Protection Program. This program is separate from existing federal loan programs, including existing Small Business Administration (SBA) disaster relief loans which you may also decide to pursue.

Paycheck Protection Program

What is it about? 

The Paycheck Protection Program is a loan forgiveness program (available through June 30, 2020) designed to provide a direct incentive for small businesses to keep workers on their payroll.

For small business owners who participate, loans obtained through this program will be fully forgiven if (1) all employees are kept on the payroll for 8 weeks and (2) the money is used for payroll costs, rent, mortgage interest, or utilities (at least 75% of the forgiven amount must have been used for payroll). As an additional incentive, loan payments will be deferred for six months. No collateral or personal guarantees are required to obtain a loan.

According to the SBA, loan forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness is reduced if full-time headcount declines, or if salaries and wages decrease.

Please note: PPP loans are not grants, instead they are loans—the majority of which can be forgiven if used for payroll costs as outlined above.

Who is Eligible?

Any small business with less than 500 employees (including sole proprietorships, independent contractors, self-employed persons, private non-profits, and 501(c)(19) veteran’s organizations) affected by the coronavirus pandemic can apply.

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H-1B season has officially kicked off!

The new mandatory H-1B electronic registration system for fiscal year 2021 opened yesterday at noon ET on March 1, 2020 and will remain open until noon ET on March 20, 2020.

In order to have a chance of being selected, from now on all prospective petitioners and their authorized representatives seeking to file H-1B cap-subject petitions for FY 2021, including for beneficiaries eligible for the advanced degree exemption, must first register during the registration period (March 1, 2020 to March 20, 2020) and pay the associated $10 registration fee for each beneficiary.

Only petitioners with a selected registration may participate in the H-1B filing process.

Registering is Easy

Petitioners and their authorized representatives must create a myUSCIS online account and submit registrations for each beneficiary via their online account during the registration period.

Per USCIS:

Prospective H-1B cap-subject petitioners or their representatives are required to use a myUSCIS online account to: 1) register each beneficiary electronically for the selection process and 2) pay the associated $10 H-1B registration fee for each registration submitted on behalf of each beneficiary. Prospective petitioners or their representatives will be able to submit registrations for multiple beneficiaries in a single online session. Through the account, they will be able to prepare, edit and store draft registrations prior to final payment and submission of each registration.

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It’s official. Yesterday, the United States Citizenship and Immigration Services (USCIS) published a notice in the Federal Register formally implementing the mandatory registration requirement for H1B petitioners seeking to file a cap-subject petition for Fiscal Year 2021. The notice went into effect on January 9, 2019, the date of publication.

Beginning March 1, 2020, before a petitioner can file an H-1B cap-subject petition, including petitions eligible for the advanced degree exemption, the petitioner must first electronically register with USCIS. Only petitioners with a valid registration selection will be eligible to file an H-1B petition with USCIS.

The initial registration period for FY 2021 will open on March 1, 2020 and is expected to close on March 20, 2020. The actual end date will be provided on the USCIS website.

Who must register?

H-1B cap-subject petitioners, including those eligible for the advanced degree exemption, seeking to file a FY 2021 H-1B cap petition will be required to first register electronically with USCIS and pay the associated $10 H-1B registration fee for each submission

Prospective petitioners or their authorized representatives must electronically submit a separate registration naming each alien for whom they seek to file an H-1B cap-subject petition. Duplicate registrations are prohibited.

What happens after the registration period closes?

Once the registration period closes, USCIS will conduct the initial selection process.

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Exciting news H-1B FY 2020 Filers!

Yesterday USCIS announced that on April 10, 2019, the computer-generated lottery was conducted to select enough petitions to meet the H-1B regular cap and the U.S. advanced degree exemption for fiscal year 2020.

In accordance with the new H-1B regulation, USCIS first conducted the selection process for H-1B cap-subject petitions submitted on behalf of all beneficiaries, including those that may have been eligible for the advanced degree exemption. USCIS then selected a number projected to reach the advanced degree exemption from the remaining eligible petitions.

In total, USCIS has announced that the agency received 201,011 H-1B petitions during the filing period that began on April 1st, including petitions filed for the advanced degree exemption.

On April 5th, USCIS announced that the agency had received enough petitions to reach the regular cap of 65,000 visas.

What happens next?

Our office will begin to receive the receipt notices for petitions that were selected in the lottery within the coming weeks. Petitioners should keep a close eye on their bank accounts to see whether USCIS has charged the filing fees to the account. If the fees were charged, then your petition was selected in the lottery.

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Today, USCIS will begin accepting H-1B petitions subject to the FY 2020 cap. Any FY 2020 cap-subject H-1B petitions filed before April 1st will be rejected.

Beginning today, 65,000 H-1B visas will be available for the regular cap, and 20,000 H-1B visas for advanced degree holders.

Selection

Important changes will be implemented for the H-1B cap selection process.

In January, the Department of Homeland Security announced a final rule amending regulations governing cap-subject H-1B petitions, including those that may be eligible for the advanced degree exemption.

The final rule reverses the order by which USCIS selects H-1B petitions under the H-1B regular cap and the advanced degree exemption, which will be in effect for the FY 2020 cap season.

USCIS will first select H-1B petitions submitted on behalf of all beneficiaries, including those that may be eligible for the advanced degree exemption. USCIS will then select from the remaining eligible petitions, a number projected to reach the advanced degree exemption.

Premium Processing Available for COS Cap Subject H-1B Petitions Only

Starting April 1, FY 2020 cap-subject H-1B petitioners requesting a change of status on their Form I-129, Petition for a Nonimmigrant Worker, may request premium processing by concurrently filing Form I-907, Request for Premium Processing Service.

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The start of the FY 2020 H-1B cap season begins on April 1, 2019. This year, USCIS will offer premium processing services in a two-phased approach to avoid temporary suspension of the service.

Change of Status H-1B Cap Petitions

Starting April 1, FY 2020 cap-subject H-1B petitioners requesting a change of status on their Form I-129, Petition for a Nonimmigrant Worker, may request premium processing by concurrently filing Form I-907, Request for Premium Processing Service.

However, to prioritize data entry for cap-subject H-1B petitions, USCIS will not begin premium processing for these petitions immediately.

USCIS will begin premium processing for these petitions no later than May 20, 2019 and will notify the public before premium processing begins for these petitions.

If a petitioner does not file Form I-907 concurrently with an FY 2020 H-1B cap-subject petition requesting a change of status, the petitioner must wait until premium processing begins to submit Form I-907.

All Other FY 2020 Cap-Subject Petitions

Premium processing services for all other FY 2020 cap-subject H-1B petitions will not begin until at least June 19, 2019. Cap-subject petitioners who are not requesting a change of status may not submit their premium processing request concurrently with their H-1B petition. These petitioners will be eligible to upgrade to premium processing once premium processing begins for this group. USCIS will notify the public with a confirmed date for premium processing for cap-subject petitioners not requesting a change of status. Continue reading

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Now is the time to begin preparing for the upcoming H-1B visa lottery. USCIS will begin to accept H-1B cap-subject petitions for fiscal year 2020 beginning Monday, April 1, 2019. Please note: employers cannot file an H-1B petition for an employee more than 6 months before the employee’s intended start date. If accepted, H-1B visa workers can begin employment by October 1st. The H-1B visa is issued for up to three years but may be extended for another three years.

By law, a congressionally mandated cap exists which limits the issuance of H-1B visas to 65,000 per year. That is why the H-1B visa is commonly referred to as a ‘lottery’ visa.

Individuals (such as F-1 students) who hold advanced degrees (U.S. master’s or higher) are exempted from the 65,000 visa cap. Such applicant’s must demonstrate that they have obtained an American master’s degree or higher to be exempted from the cap, however only the first 20,000 petitions received by USCIS will benefit from this cap exemption.

In order to qualify for an H-1B visa:

  • a foreign worker must possess both a theoretical or practical application of a body of highly specialized knowledge;
  • an employer-employee relationship must exist. Only a U.S. employer can petition the entry of a foreign employee by filing USCIS Form I-129 Petition for Non-immigrant Worker. An employer-employee relationship exists if the U.S. employer has the right to hire, pay, fire, supervise or control the work of the employee;
  • the foreign worker must possess a bachelor’s degree, its foreign equivalent, or relevant work experience. If the foreign worker does not have formal education, but has at least 12 years of relevant work experience related to the specialty occupation, they may still qualify for an H-1B visa;
  • the foreign worker must be employed in a specialty occupation related to their field of study. A specialty occupation is an occupation that requires a bachelor’s degree or its equivalent;
  • the foreign worker must be paid at least the prevailing wage for the specialty occupation in the area of intended employment;

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The E-2 treaty investor visa allows foreign nationals to make an investment in an existing or new business venture in the United States.

Advantages

There are no numerical limitations on the number of E-2 visas that can be issued, and there is no set minimum level of investment required, however the level of investment that should be made in the business venture should be sufficient to justify the presence of the foreign national in the United States. Although the E-2 visa is granted for an initial two-year period, the investor may qualify to extend their stay in two-year increments, with no outer limit on the total period of the foreign national’s stay.

Disadvantages

Not all foreign nationals are eligible to apply for the E-2 treaty investor visa. To qualify, you must be a foreign national from a treaty country that participates in a treaty of friendship, commerce, navigation or similar agreement with the United States. See below for qualifying countries:

Albania Czech Republic Kosovo Romania
Argentina Denmark Kyrgyzstan Serbia
Armenia Ecuador Latvia Senegal
Australia Egypt Liberia Singapore
Austria Estonia Lithuania Slovak Republic
Azerbaijan Ethiopia Luxembourg Slovenia
Bahrain Finland Macedonia Spain
Bangladesh France Mexico Sri Lanka
Belgium Georgia Moldova Suriname
Bolivia Germany Mongolia Sweden
Bosnia and Herzegovina Grenada Montenegro Switzerland
Bulgaria Honduras Morocco Thailand
Cameroon Iran The Netherlands Togo
Canada Ireland Norway Trinidad and Tobago
Chile Italy Oman Tunisia
China (Taiwan) Jamaica Pakistan Turkey
Colombia Japan Panama Ukraine
Congo (Brazzaville and Kinshasa) Jordan Paraguay United Kingdom
Costa Rica Kazakhstan Philippines Yugoslavia
Croatia South Korea Poland

Another disadvantage is that the E-2 visa is a temporary non-immigrant visa type. This means that the E-2 visa does not create a pathway to permanent residency. In addition, making an investment in a small business venture is risky. Most small businesses fail. Investors seeking to establish a new business in the United States must be prepared to face challenges, obstacles, and potential losses. If the investment will be made by a company, at least 50% of owners in the qualifying country must maintain the nationality of a treaty trader country if they are not lawful permanent residents.

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On Friday December 1st, a federal judge for the U.S. District Court for the District of Columbia, issued a ruling in the lawsuit, National Venture Capital Association, et.al. v. Duke, et. al, in favor of the National Venture Capital Association, an association that brought the lawsuit to challenge the government’s delay of the international entrepreneur rule. Earlier this year, the Trump administration had postponed enforcement of the international entrepreneur rule and said that it was very likely that the Obama era rule would ultimately be rescinded. The Plaintiffs in the lawsuit argued that the Department of Homeland Security unlawfully delayed enforcement of the international entrepreneur rule by circumventing the notice-and-comment rule making procedure mandated by the Administrative Procedure Act.

As you may remember the international entrepreneur rule was first published in the Federal Register on January 17, 2017. Following its publication, a notice-and-comment period was expected to begin 30 days later. The government however failed to announce such a comment period, and instead, on July 13, 2017, just days before the rule was set to go into effect, the Department of Homeland Security issued a press release indicating that implementation of the rule would be delayed until March 14, 2018, at which time the government would seek comments from the public on its plan to rescind the rule.

Federal Judge James Boasberg dealt a blow to the Trump administration in his Friday ruling, in which he agreed with the National Venture Capital Association, and ordered the Department of Homeland Security to rescind its delay of the international entrepreneur rule. The court agreed that the government bypassed the procedures of the Administrative Procedure Act to block the rule from going into effect as expected on July 17, 2017.

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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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