On January 17, 2017, the Department of Homeland Security (“DHS”) published its final adaptation of the International Entrepreneur Rule (“Rule”). The Rule authorizes DHS to exercise its discretion to grant parole to foreign entrepreneurs who would provide a significant public benefit to the United States. Significant public benefit includes enhancing innovation, generating capital investments, and creating jobs. The parole period is valid for up to 30 months and may be extended for an additional 30 months.
This regulation is great news for foreign entrepreneurs who seek to build, oversee and grow their start-up companies in the United States. The new rule is effective on July 17, 2017.
To qualify for initial parole, a foreign entrepreneur (“applicant”) must meet the following criteria at the time of adjudication:
1. New Start-Up Entity: The applicant has created a new entity within the 5 years immediately preceding the filing date;
2. Significant Ownership Interest: The applicant possesses at least 10% ownership interest in the start-up entity;
3. Active & Central Role: The applicant plays an active and central role in the start-up entity. Stated differently, the applicant cannot be a “passive” investor and must be well-positioned to assist the entity in growing its business in the United States; and
4. Potential for Rapid Growth and Job Creation: The applicant must demonstrate that the start-up entity shows potential for rapid growth and job creation in one of the following ways:
a. Receipt of at least $250,000 from qualified U.S. investors with successful track records (funds must be received 18 months before filing);
b. Receipt of at least $100,000 in grants or awards from government entities with expertise in economic development, research, and development, or job creation (funds must be received 18 months before filing); OR
c. Alternatively, the applicant may provide additional reliable and compelling evidence to satisfy this requirement.
To qualify for re-parole, the applicant must meet the following criteria at the time of adjudication:
1. Significant Ownership Interest: The applicant possesses at least 5% ownership interest in the entity;
2. Active & Central Role: The applicant continues to play an active and central role in growing the entity; and
3. Continuation of Start-Up Entity: The applicant must demonstrate that the entity has been lawfully operating in the United States, and continues to show potential for rapid growth and job creation during the initial parole period. The latter may be established in one of the following ways:
a. Receipt of at least $500,000 in additional funding from qualified U.S. investors and/or government entities;
b. Receipt of at least $500,000 in annual U.S. revenue (with 20% average annualized revenue growth);
c. Creation of at least 5 full-time U.S. jobs; OR
d. Alternatively, the applicant may provide additional reliable and compelling evidence to satisfy this requirement.
Upon grant of parole, the entrepreneurs may work in the United States, but only for the qualified start-up entities. Their spouses may apply for a work permit.
For entrepreneurs abroad, they must enter the United States to activate parole. For those in the United States (in another status), they must first depart the United States and then appear at a U.S. port of entry to be paroled in.
DHS made clear that “parole” in this case is not considered an “admission” or a “visa.” Thus, qualified entrepreneurs may not adjust or change status in the United States (unless otherwise eligible). However, prior to reaching the 5-year parole period, entrepreneurs may apply for any nonimmigrant or immigrant classification in which they are qualified for. Upon approval of the relevant visa petitions, the entrepreneurs would generally be required to depart the United States to apply for the visas at a U.S. consulate.
Although the Rule is quite comprehensive, the application process is in development. Consequently, entrepreneurs who have questions about their eligibility should contact an experienced immigration attorney, who has the ability to accurately interpret and understand the new regulation. It is crucial to be well-informed and well-prepared before the effective date of July 17, 2017.
ABOUT THIS AUTHOR
Richard M. Wilner – Founding Partner
Richard M. Wilner is a founding member of Wilner & O’Reilly, APLC and is Board Certified by the State Bar of California as a Specialist in Immigration and Nationality Law. He is admitted to practice law in the State of California and before the U.S. District Courts for the Central, Northern and Southern Districts of California, the Northern District of Texas, the U.S. Court of Appeals for the Ninth Circuit and the U.S. Supreme Court.
Jeanny Tsoi – Attorney
Ms. Jeanny Tsoi is an Associate Attorney at Wilner & O’Reilly who handles employment-based transactional cases. She also has extensive experience with family-based immigration matters, 601/601A waivers, non-immigrant visas, and asylum applications. She is admitted to the State Bar of California, the United States District Court for the Central District of California, and the United States Court of Appeals for the Ninth Circuit. Ms. Tsoi graduated Cum Laude from University of Southern California with a Bachelor’s degree in Art History. In 2012, she earned her Juris Doctorate degree from Southwestern Law School where she was the Vice President of Phi Alpha Delta Law Fraternity and a member of the Asian Pacific American Law Students Association.