It’s a relief to be sharing some positive news on startup immigration. In May 2021, the Department of Homeland Security announced they will be restarting the International Entrepreneur Rule, (IER). The IER is an Obama-era regulation that allows foreign-born entrepreneurs to come to, or stay in, the U.S. to work on their startup. At McEntee, we recognize that it has been an uphill battle to get this program up and running. Our firm has proudly advocated for this program since 2016.

 

This year alone, our Managing Attorney, Fiona, has been very active in advocating for immigration options for startups including:

We are relieved IER is finally available, but, as Fiona outlined in her statement to Congress and as we will explain below, it is not perfect. There will be some significant challenges ahead.

What’s the History of the IER?

The IER was first introduced in January 2017, during the final days of Obama’s second term. The original effective date was set for July 17, 2017. Shortly after the rule was created, the Trump administration took measures to delay the rule. They pushed back the effective date and ultimately tried to rescind the IER completely.

That attempted rescission was met with litigation and resistance. Organizations such as the NVCA and FWD.us, and immigration lawyers and advocates like us at McEntee Law have worked tirelessly to get it reinstated. Over 4 years have passed since the rule’s initial release. Immigrant entrepreneurs are now getting the chance to apply for IER thanks to the Biden administration’s decision to fully implement it.

Who is Eligible for IER?

The IER was created for startups/companies that have the potential for significant growth and job creation.

Immigrant entrepreneurs may be eligible for the IER if they have the following:

  • A major ownership (at least 10% initially) in a startup created in the U.S. within the last 5 years
  • A central and active role in the startup
  • Ability to show that the startup will have a positive public benefit on the U.S. either by:
    • Receiving a significant investment ($250K or more) from qualified U.S. investors (typically venture capitalist, angel investor, or startup accelerator)
    • Receiving significant awards or grants ($100K or more) from certain federal, state, or local government entities or
    • Partially meeting 1 or both of the above with added evidence showing potential for rapid growth or job creation

How can I show that my startup has the potential for significant growth and job creation?

Applicants may include some of the following evidence: the number of users/customers, revenue generated, added fundraising such as crowdfunding, social impact, prior successes of the founder, national impact, or any positive impact on their region.

How does this work procedurally?

The IER is a two-step process. Applicants first need to file an IER application (Form I-941) with the USCIS. If/when that gets approved, applicants must make an appointment and visit a U.S. Embassy/Consulate to get a travel document (boarding foil). They must then use the IER approval and the boarding foil to go to a U.S. port of entry for a final parole determination.

Notably, Canadian nationals traveling directly from Canada to a U.S. port of entry may present an IER approval notice at the U.S. port of entry without first obtaining a travel document/boarding foil.

Is IER a startup visa? What’s the difference between this program and a visa?

No, the IER is not a visa. As IER is based on DHS’ limited parole authority – it is not a visa or status – applicants cannot change status to/from it in the U.S. They must leave to get the required boarding foil (Canadians aside) and then re-enter the U.S.

Unlike so many of our international peers, the U.S. does not currently have a startup visa – we would need Congress to pass a law that creates a startup visa and we have long been advocating for this.

Are there different rules for different countries?

No, unlike some other options (like the E-2 investor visa), the IER is not country-specific. This program is available to all who meet the requirements, regardless of where you are from. As noted above the one exception to different requirements is for Canadians who are not required to get a boarding foil prior to entering.

How long is IER approved for?

IER can be initially approved for 2.5 years. There is an option to apply for a 2.5-year extension if the startup continues to provide a “significant public benefit,” as shown by substantial increases in capital investment, revenue, or job creation.

How long will IER applications take?

Because the rule is so new, application processing times are unknown. We did ask this question during a stakeholder meeting with USCIS and DHS but they were not able to share processing times as of yet. Fiona also urged Congress to implement a premium/expedited processing option for IER but as of now, that is not available. Also unknown is how long it will take to get appointments at Embassies/Consulates abroad given all the COVID-related backlogs.

How many founders per company can apply for IER?

Up to 3 eligible entrepreneurs per startup can apply for IER, assuming they each meet the requirements.

Is this rule specific to startup founders?

No. The IER is available to individuals/companies that meet the eligibility requirements listed above and is not exclusive to founders of a traditional “start-up.” It could be used for other businesses/companies in all industries if they meet the requirements.

Can family members come to the US, too?

Yes, the spouses and minor, unmarried children of the foreign entrepreneur may also be eligible to enter the U.S. Spouses may apply for work authorization once here as parolees, but children are not eligible to work.

What are the challenges of the IER?

The IER was written years ago and is based on DHS’ limited parole authority. As a result, applicants cannot change status to/from it in the U.S. They must leave to get the required boarding foil (Canadians aside) and then re-enter the U.S.

We recognize that the Obama administration likely did all they could when drafting the IER based on this statutory parole authority. However, the rule was written years before COVID, and the current conditions could never have been anticipated.

Given the pandemic and the tremendous backlogs for appointments at U.S. Embassies/Consulates, it is going to be a long time before non-Canadian immigrant entrepreneurs can enter on this International Entrepreneur Parole. The U.S. is going to miss out greatly in the interim, especially when we so desperately need a post-pandemic economic boost.

What are Fiona’s recommendations to Congress?

In the immediate term, Congress could pass a law that enables immigrant entrepreneurs in the U.S. to change status to IER here without the need to leave and be paroled in. Premium processing should also be available for the IER applications.

Additionally, Congress could remove the boarding foil requirement from the IER procedure thereby allowing all IER approved applicants abroad (not just Canadians) to present the IER approval notice to a U.S. port of entry.

Ultimately, in the long term, only Congress can pass more robust startup visa legislation and create additional immigration pathways to ensure that the United States – and not somewhere else – attracts and retains these innovative international entrepreneurs.

To find out more on Fiona’s recommendations to Congress, read her entire statement here. The Congressional hearing, titled,  “Oh Canada! How Outdated U.S. Immigration Policies Push Top Talent to Other Countries” took place on July 13th. You can also watch the entire hearing.

Why is the IER so important?

Unlike many of our international peers, the current U.S. immigration laws do not provide a specific immigration option for startup founders — commonly known as a “startup visa.” Instead, immigrant entrepreneurs are forced to navigate an antiquated system largely rooted in employer-sponsored visas, like for example the H-1B visa. The existing visa options do not readily accommodate the startup entrepreneur for many reasons the least of which includes the fact that they were all created over 30 years ago well before we had the internet on our phones, and before social media and apps.

With some of the modifications recommended above, the IER could be a great short-term solution and would allow hardworking, foreign-born entrepreneurs to grow their companies, and resulting jobs, in the U.S. The success of companies such as Google, Uber, and Tesla, would not be possible without the work of immigrant entrepreneurs. In fact, “more than half of America’s startup companies valued at $1 billion or more have at least one immigrant founder,” (Anderson, 2018).

It’s clear that America has so much to gain from this rule, and we know that this is just the beginning. It’s exciting to think about what successful companies will come as a result of this rule. There are so many bright, talented foreign entrepreneurs out there waiting for an opportunity such as the IER.

“Immigrants in the United States have a long history of entrepreneurship, hard work, and creativity, and their contributions to this nation are incredibly valuable,” says Tracy Renaud, director of the United States Citizen and Immigration Services after the DHS announcement on May 10th.

We couldn’t agree more.

Having robust immigration options for entrepreneurs and startups is not only a win for those immigrant entrepreneurs, it’s a win for America.
Allowing more immigrant entrepreneurs to grow their businesses in the U.S. will undoubtedly have a positive impact on the economy and the country as a whole. Let’s make sure this can happen!

How can I find out more?

Our Managing Attorney, Fiona, is a true leader in this field. In addition to presenting this option to the American Immigration Lawyer’s Association (AILA) Chicago Chapter, we will be organizing a webinar for potential IER applicants and for those who want to find out more.

You can sign up by joining our mailing list:

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In the meantime, if you want to schedule a consultation on IER or on immigration options for startups, please contact info@mcenteelaw.com.

 

 

Fiona McEntee, Managing Attorney of McEntee Law, has been a national leader on immigration advocacy efforts for startups for over a decade.

 

 

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