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Filing Instructions Published Dec. 14, 2017 – the International Entrepreneur Rule (IER) was finally implemented with USCIS’ publication of instructions on how international entrepreneurs can file Form I-941, Application for Entrepreneur Parole, in order to stay in the U.S. and develop business.

While not offering a path to U.S. permanent residence or U.S. citizenship, the IER does grant qualified international entrepreneurs temporary parole for up to five years (initial 2.5 year approval with possible 2.5 year extension) in the U.S. if they:

Continue Reading USCIS Provides Filing Instructions For Likely Short-Lived International Entrepreneur Rule and Errors Found in Instructions

On Dec. 14, the Office of Management and Budget Office of Information and Regulatory Affairs (OMB) published the biennial Unified Agenda.  A long-standing outgrowth of previous regulatory reform efforts, the Unified Agenda offers the public the “current thinking” of federal agencies on upcoming Agency regulatory priorities.

Of importance to the immigration community, DHS USCIS posed the following regulatory priorities-

United States Citizenship and Immigration Services

U.S. Citizenship and Immigration Services (USCIS) is the government agency that oversees lawful immigration to the United States. USCIS’s role is to efficiently adjudicate and manage petitions, applications, and requests for immigration benefits for foreign nationals seeking lawful immigration status in the United States and for individuals seeking to become citizens of the United States, and other matters within the jurisdiction of the agency, in a manner that detects, deters, and prevents fraud, protects the jobs and working conditions of American workers as appropriate, and ensures the national security, public safety, and welfare of the American people. In the coming year, USCIS will promulgate several regulatory and deregulatory actions to directly support these commitments and goals.

Continue Reading OMB OIRA Releases Unified Agenda and USCIS Regulatory Priorities, Including H-1B, EB-5, and More

20229_Carousel-InventionOn Jan. 17, 2017, the Department of Homeland Security (DHS) published its final rule to implement discretionary parole authority to increase, promote, and encourage entrepreneurship, innovation, and job creation in the United States. This final rule will add new regulatory provisions that will allow DHS to grant parole in certain circumstances and by discretion to entrepreneurs of start-up entities who are able to show through evidence the potential for business growth, job creation, and public benefit to the United States. Potential may be evidenced by the receipt of capital investment from U.S. investors or obtaining awards or grants from government entities. The criteria will be discussed in more detail below. If the parole is granted, the entrepreneur will be allowed a temporary stay of up to 30 months that may be extended for an additional 30 months. The final rule will be effective on July 16, 2017.

Requirements to qualify for parole for entrepreneurs:

  • Meet the definition of entrepreneur:  An entrepreneur is defined as an alien who possesses a substantial ownership interest in a start-up entity and is actively engaged in the operations of the entity, and who has the qualifications to perform such duties. A substantial ownership interest means possession of at least 10 percent of the start-up entity for the first parole application, and at least 5 percent ownership interest if applying for a renewal of the parole.  During the initial period of parole, the entrepreneur must maintain at least 5 percent ownership interest in the entity, and during the subsequent period of re-parole, may reduce the ownership interest, but must always maintain an ownership interest in the entity.
  • Entity must meet the definition of start-up entity:  A start-up entity is defined as an entity created within the five years immediately preceding the filing of the alien’s initial parole application. If the entity has received a grant, award, or investment, then it will be considered as recently formed if it was created within five years preceding the receipt of the above-mentioned items.
  • Definition of a government award or grant: This means an award or grant for economic development, research and development, or job creation that has been given by a U.S. federal, state, or local government entity.

Continue Reading DHS Finalizes International Entrepreneur Rule

Congressional efforts to pass sweeping immigration reform have stalled following the 2013 Senate passage of S.744, the Border Security, Economic Opportunity, and Immigration Modernization Act. But lawmakers continue to press the case that our system of employment-based immigration merits congressional attention.

A quick survey of legislation introduced during the first session of the 114th Congress reveals that 105 bills have been introduced on the subject of immigration.  These bills address a variety of immigration policies including interior enforcement, border security, workplace verification, and employment-based immigration.  Among these bills are policy ideas that would have a meaningful impact on our current system.  As an aside, the survey also reveals how difficult it is to pass immigration legislation in the current legislative environment: only two bills, H.R.3009 (dealing with “sanctuary cities”) and S.1300 (dealing with international adoption) have been approved by a single chamber during the first seven months of the session.  And only a handful has even had the benefit of any committee consideration.

Continue Reading Legislative Roundup: Business-Related Immigration Bills in the 114th Congress

On July 29, Representative Zoe Lofgren, Ranking Member of the House Judiciary Committee, Subcommittee on Immigration and Border Security, and Representative Luis Gutiérrez introduced H.R.3370, the Entrepreneurial Business Creating Jobs Act of 2015 to permanently reauthorize and reform the EB-5 Regional Center Program. Representative Lofgren’s sectional summary can be found here.

The legislation provides visas for foreign entrepreneurs who obtain venture capital or seed financing and wish to start businesses in the United States. And it provides visas for foreign entrepreneurs who are in the United States in non-immigrant status operating an existing business and can show that the business is growing.

The legislation also permanently reauthorizes the Conrad State 30 J-1 Visa Waiver Program, and authorizes for five years the E-Verify Program and the Special Immigrant Nonminister Religious Worker Program. Below are the major components of the legislation:

Provisions for “Venture Capital-Backed Start-Up Entrepreneurs”

  • Visas are made available to foreign entrepreneurs on a conditional basis who are sponsored by, as defined by the legislation, a “qualified venture capital fund,” one or more “angel investors,” a “qualified business,” or who obtain funding through a “qualified seed accelerator.”
  • In order to have conditions removed, the entrepreneur must show that within a two-year period, the business created full-time jobs for five or more U.S. workers; raised an additional $2 million in capital investment; earned $1 million in revenue; or created full-time jobs for three U.S. workers with salaries of $100,000.

Continue Reading Representative Zoe Lofgren and Representative Luis Gutiérrez Introduce EB-5 Regional Center Reauthorization Legislation

Greenberg Traurig’s Business Immigration & Compliance Practice has been shortlisted for The Legal 500 United States 2015 Awards in the areas of “Labor and Employment – Immigration.”  The team of more than 100 experienced legal professionals provides a wide range of services including immigration policy development, immigration compliance, U.S. work visas and permanent residence, global immigration, legal advocacy and legislative representation, and EB-5 immigration investment and job creation.  Greenberg Traurig immigration attorneys Laura Reiff, Kate Kalmykov, Ian Macdonald, Pamela Mak and Martha Schoonover have also been recommended in The Legal 500 United States 2015 guide to outstanding lawyers.  Reiff has also been included on the elite “Leading Lawyers” list in the Legal 500 United States 2015 guide.  In addition to the immigration group, The Legal 500 United States 2015 guide to outstanding lawyers nationwide has also recommended Greenberg Traurig as a “Top Tier” firm in the “Real Estate and Construction – Real Estate” category as well as 100 plus Greenberg Traurig attorneys and more than 25 firmwide areas of practice and industry focus. See the full Greenberg Traurig press release.

True or FalseMyth 1:  Buy a Green Card – The EB-5 program was established to help high-net-worth individuals buy a green card.

Fact:  The EB-5 program is a highly regulated employment-based permanent residence application that takes years to complete.  The initial application requires detailed proof of investment in a qualified project.  It also requires evidence of an investment of either 1 million USD or 500,000 USD and the creation of 10 jobs for U.S. workers.  The investor’s application is screened and, if approved, only a “conditional green card” is granted. The same in-depth review of the project and the investor’s background are conducted two years after conditional status is granted to ensure the individual’s continued eligibility for the EB-5 immigrant investor category.

Myth 2:   Loophole for Criminals/Terrorists – The EB-5 program provides an easier way for potential immigrants to go through background clearances, providing a loophole for potential criminals and terrorists.

Fact:  As described above, the EB-5 program requires an investor’s record to be reviewed two times – once for a conditional green card and then again when obtaining a permanent green card.  In addition to the normal screening process for other employment based permanent residence applicants, which is conducted twice for EB-5 applicants, the EB-5 applicant must have the project reviewed for compliance with regulatory requirements, including proving the requisite amount of investment and the requisite number of jobs to be created.  Moreover, EB-5 applicants go through a rigorous vetting process to demonstrate that their source(s) of funds is(are) lawful and that those funds can legally be invested into qualified projects. Continue Reading Myth vs. Fact: Responses to Arguments Against the EB-5 Pilot Program

On March 6, 2014, Representative Jared Polis (D-CO), along with Representative Joe Garcia (D-FL), Representative Matt Salmon (R-AZ) and Representative Mark Amodei (R-NV), introduced The American Entrepreneurship and Investment Act of 2014. A copy of the bill and an official Section by Section overview have been made available. The legislation would, among the other items listed below, make the Regional Center program permanent and improve the program by addressing key administrative and substantive concerns. Some of the specific proposals in the bill include:

  • Improved definition of Targeted Employment Area (TEA) designations
    • Codifies the current TEA designation authority, which leaves such designations up to the states, which are best equipped to determine local employment needs. This is consistent with USCIS’s May 30, 2013 “EB-5 Adjudications Policy (PM-602-0083);
    • Lowers the minimum capital investment required from $1,000,000 to $500,000; and
    • Expands the TEA designation for areas where a military installation was closed and where a State or the Federal government has designated an area as an economic development incentive program.

Continue Reading House Member Introduces Bi-Partisan Immigration Legislation to Enhance, Augment the EB-5 Regional Center Program

As immigration reform moved toward approval by the Senate Judiciary Committee on May 21, 2013, another stand-alone bill (H.R. 2131) has been introduced by Rep. Darrell Issa (R-Calif.) in the House.  Mr. Issa is the chairman of the House Oversight Committee but, more importantly to the immigration reform debate, he sits on the House Judiciary Committee.  Mr. Issa’s “Skills Visa Act” includes, among other things, provisions that will impact the EB-5 program, and also proposes two other programs that would give entrepreneurs alternatives for pursuing permanent residence. 

The EB-5 Changes Include:

  • Permanent Reauthorization: The bill would make the program permanent. It is currently set to sunset in 2015 absent Congressional reauthorization.
  • Minimum investment: The minimum investment amounts would be increased to reflect the change in the value of the dollar from the program’s creation in 1990 to the present day and would be prospectively indexed for future inflation. This could increase the base amounts of investment by almost $300,000 initially.
  • Job Creation: USCIS currently requires that the job creation requirement be met two years after the grant of a conditional green card when an investor seeks the removal of the conditional status of their permanent residence or “at a reasonable time thereafter.”  The bill states that the required jobs must actually exist at the time that the conditional status is removed and allows USCIS to extend the conditional status for an extra year in order to give an investor additional time to create the required jobs.
  • Targeted Employment Areas: In an effort to prevent the “gerrymandering” of low-unemployment areas into targeted employment areas, the bill provides that 1) the relevant “targeted employment area” must fit entirely within a geographical unit that the U.S. Department of Labor has determined has an unemployment rate of at least 150 percent of the national rate; 2) the U.S. Secretary of Labor shall set forth a uniform methodology for determining whether an area qualifies as having unemployment of at least 150 percent of the national rate; and 3) USCIS will not be bound by the decision of any other entity that a particular area has experienced high unemployment. This provision could hamper TEA designations.
  • Fraud Deterrence: In order to deter fraud, the bill bars persons from involvement in regional centers who 1) have committed crimes that are considered aggravated felonies under the Immigration and Nationality Act (INA); 2) would be inadmissible pursuant to the security and terrorism-related grounds of inadmissibility (if they were aliens seeking admission); or 3) have been convicted of criminal securities fraud or have been found to have engaged in civil securities fraud. Additionally, the section clarifies and expands the U.S. Department of Homeland Security’s (DHS) authority to perform criminal record and background checks on regional center managers, owners, administrators, promoters, and others who have significant responsibility in the regional center. DHS may terminate regional centers from participation in the investor visa program if prohibited persons are involved in the centers or if the centers provide false information in the context of background checks.
  • Securities Compliance: The bill requires regional centers to certify compliance with Federal securities laws. USCIS could terminate regional centers for failure to make the necessary certifications or for securities law violations.

Changes to Permanent Residence Options:

As noted above, the bill creates two new permanent residence options for foreign entrepreneurs. 

  • The first program is for venture capital-backed entrepreneurs who attract investment of at least $500,000 from a qualified venture-capital operating company or at least $100,000 from a qualified angel investor.   The entrepreneur would be given conditional permanent residence for up to three years to create jobs for at least five U.S. workers and two years to raise an additional $1,000,000 in capital or generate not less than $1,000,000 in revenue.
  • The second program is for foreign entrepreneurs who have been operating businesses in the U.S. under the E-2 treaty investor non-immigrant visa program.   This program would make permanent residence available to E-2 treaty investors who have maintained their status for a minimum of 10 years and have created jobs for at least five U.S. workers for a minimum of 10 years.

with Nataliya Binshteyn

On March 5, 2013, the Office of the Citizenship and Immigration Services Ombudsman (“USCIS Ombudsman’s Office”) held a meeting for stakeholders of the EB-5 Immigrant Investor Program (“EB-5 program”) to address issues ranging from persistent adjudication delays to the conflict between agency standards and business realities. The gathering, which featured speakers from government and the private sector, emphasized the following key themes for improving the EB-5 program and expanding its reach to stakeholders abroad and in the United States.

Predictability

The lack of reliable adjudication standards and accurate processing times undercuts business development and stymies legal practitioners. It also discourages prospective investors, who are increasingly seeking out similar programs in Australia and Canada because they are easier to navigate and more transparent. For example, current processing times can be as long as 18 months to two years and accurate information about adjudication timelines cannot be obtained.

Requests for Evidence

Stakeholders reported a close to 100% Request for Evidence (RFE) rate for Form I-924, Application for a Regional Center Under the Immigrant Investor Pilot Program, petitions. Many also noted that “unduly burdensome” RFEs often announce new standards for evaluating the merits of such cases, making it impracticable and unnecessarily difficult to prepare a successful petition. Furthermore, approval rates of less than 40% indicate that investors and their counsel are finding it difficult to understand the applicable legal standard and prepare strong petitions.

Communication and Transparency

Stakeholders were universal in their criticism of the USCIS’ EB-5 communication channels, emphasizing the absence of meaningful dialogue, useful email responses, and case status tracking. As noted above, stakeholders often learn agency policies through the issuance of RFEs and no direct telephone or substantive email outlet between petitioners, regional center representatives and adjudicators exists. Furthermore, opaque and unannounced adjudication delays are frustrating, inefficient, and very harmful to often time-sensitive business priorities.

Unsettled Policy and Adjudication Issues

The legal basis for requiring NAICS codes and regional center job creation before the end of the conditional residence period is currently unsettled, contributing to a status quo that some stakeholders call “per se unreasonable.” In addition, key questions about the applicability of tenant occupancy jobs, bridge loans, and multiple economic models to support job creation remain unanswered.

Leadership

Stakeholders voiced concerns about the practical impact of moving EB-5 processing operations from the California Service Center to DC headquarters, noting the likelihood of additional costs and delays during the transition period. In addition, leadership and accountability were among the key issues raised by stakeholders who questioned the USCIS’ “institutional commitment” to the EB-5 program and critiqued the lack of commercially reasonable and objective-driven parameters for guiding its growth in the legal, business and international investor communities.

For up-to-date news and commentary about EB-5 issues, please visit www.eb5insights.com.