Great news for foreign entrepreneurs looking for a way to pursue startup opportunities in the United States! A Federal Judge has blocked an effort by the Trump Administration to delay implementation of the International Entrepreneur Rule (IER), also known as the Entrepreneur Parole Rule, an Obama-era program that would give international entrepreneurs the opportunity to come to the United States to develop and operate start-up businesses. Although the IER was published during the previous administration with an effective date of July 17, 2017, it did not take effect because the Department of Homeland Security (DHS) issued a final rule on July 11, 2017, delaying the IER’s effective date until March 14, 2018. This delay rule was meant to give USCIS time to review the IER and, if necessary, to issue a rule proposing to remove the IER program regulations.
However, on December 1, Judge James Boasberg of the U.S. District Court for the District of Columbia ordered the Department of Homeland Security (DHS) to begin accepting applications for the program in his decision in National Venture Capital Association v. Duke. Prior to Judge Boasberg’s decision, DHS attempted to delay implementation of the rule by postponing its implementation until March of 2018 so it could gather public comments on a proposal to rescind the rule altogether.
The main issue that led to Judge Boasberg’s decision arose when DHS delayed implementation of the rule without first holding a public notice and comment period on whether to institute the delay. According to the plaintiffs who filed the suit, including the National Venture Capital Association and other plaintiffs representing foreign entrepreneurs, DHS violated administrative procedures by delaying implementation of the rule, six days before it was to go into effect, without first soliciting public comment on whether to implement the delay.
Department of Homeland Security | DHS.gov
DHS, for its part, argued that holding such a notice and comment period would be unduly burdensome, confusing, and expensive given the program’s “imminent effective date” and that it had good cause to not employ notice and comment under the Administrative Procedure Act.
In siding with the plaintiffs, Judge Boasberg rejected DHS’s argument that it had good cause to forego the public comment period. Judge Boasberg stated that “the agency’s proffered reasons for bypassing notice and comment easily fall short of good cause,” and that “Defendants fail to show any real ‘confusion’ that required bypassing notice and comment.” In addition, Judge Boasberg also refused to issue a stay of the International Entrepreneur Rule’s immediate implementation, stating that it was not justified and would “simply remedy the agency’s delay with more delay.”
What is the International Entrepreneur Rule?
The International Entrepreneur Rule, which was issued by U.S. Citizenship and Immigration Services prior to President Obama leaving office, would provide international entrepreneurs with an opportunity to develop and run a business in the United States. The Rule would permit around 3,000 international entrepreneurs annually to reside in the United States for the purposes of developing and operating a business that offered a significant public benefit. To qualify, the entrepreneur would have to demonstrate that their business promotes public interest in ways that include hiring U.S. workers and contributing to the U.S. economy.
Under the International Entrepreneur Rule, the entrepreneur and qualifying family members would be admitted through a process known as “parole.” Unlike other forms of immigration to the United States, parole involves immigration officials permitting an applicant to enter the United States, without a visa, for a specific purpose (this status is not a visa). In the case of the International Entrepreneur Rule, the initial grant of stay would be for 30 months, with the possibility of an additional 30 month-extension.
Currently, the International Entrepreneur Rule is one of the only options available for many foreign entrepreneurs to develop their businesses in the United States, without prior work abroad for the company, or significant investment. While there have been multiple attempts in Congress to create a new entrepreneur-focused visa category, these attempts have thus far been unsuccessful. Therefore, this program is the best bet for recent grads who want to stay in the US to work on their funded business, or for successful entrepreneurs to break new ground on their business idea in the United States.
What’s Next?
While DHS has begun accepting applications and has begun implementing the program, there is no reason to assume the Trump Administration will cease its attempt to revoke the entrepreneur rule altogether. It is likely that DHS will move forward with its public notice and comment period on whether to revoke the rule. Even if the comments solicited during the public hearing period are in favor of preserving the rule, the Administration will likely still continue to push for its removal. For example, a January 2017 executive order by President Trump ordered stricter enforcement of parole procedures (DHS’s attempt to delay the program was in response to this executive order). In addition, influential members of congress have expressed concern that the Rule had the potential of harming United States business interests.
Given the uncertain future of the International Entrepreneur Rule, it is advisable that anyone interested in the program act quickly, before this status potentially changes again.
To find out of you qualify for the International Parole Rule, schedule a consultation with The Grady Firm attorneys today.
About The Grady Firm, P.C.
The Grady Firm, P.C. attorneys specialize in helping businesses grow and succeed through employment, business, and immigration law advising for clients in California. They help perform personnel audits, draft/revise Employee Handbooks, train employers on employment law compliance, provide on-demand legal analysis for hiring and firing questions, and provide leadership and sexual harassment training in English and Spanish.
To learn more about ensuring your business is compliant with state and local laws, schedule a complimentary 15-minute consultation with The Grady Firm’s attorneys; call +1 (949) 798-6298; or fill out a Contact Request Form.
