On January 17, 2017, the Department of Homeland Security (DHS), under the Obama Administration, announced an International Entrepreneur Rule (IER) which would become effective on July 17, 2017. Subsequently, however, the Trump Administration delayed the implementation of the rule until March 14, 2018. After litigation over its implementation ensued, the U.S. District Court for the District of Columbia in National Venture Capital Association v. Duke vacated the DHS’ final rule to delay the effective date forcing the Trump Administration to implement the rule immediately. While the DHS is abiding by a Federal Court Order to implement the rule, it is simultaneously seeking rescission of IER. The DHS has stated that “… the rule is not the appropriate vehicle for attracting and retaining international entrepreneurs and does not adequately protect U.S. investors and U.S. workers.”
Currently in effect, IER permits foreign entrepreneurs to obtain parole status in the U.S. Under the IER, DHS may “use its parole authority to grant a period of authorized stay, on a case-by-case basis, to foreign entrepreneurs demonstrating their stay in the U.S. would provide a significant public benefit through their business venture and that they merit a favorable exercise of discretion.”
Entrepreneurs eligible under the rule and granted parole will be eligible to work only for their start-up business. The spouses and children of the foreign entrepreneur may also be eligible for parole. Spouses may apply for work authorization once present in the United States as parolees. However, dependent children are not eligible to work. IER parole may be granted for up to three entrepreneurs per start-up entity.
Entrepreneurs applying for parole under this rule must demonstrate that they:
- Possess a substantial ownership interest in a start-up entity created within the past five years in the United States that has substantial potential for rapid growth and job creation.
- Have a central and active role in the start-up entity such that they are well-positioned to substantially assist with the growth and success of the business.
- Will provide a significant public benefit to the United States based on their role as an entrepreneur of the start-up entity by showing that:
- The start-up entity has received a significant investment of capital from certain qualified U.S. investors with established records of successful investments;
- The start-up entity has received significant awards or grants for economic development, research and development, or job creation (or other types of grants or awards typically given to start-up entities) from federal, state, or local government entities that regularly provide such awards or grants to start-up entities; or
- They partially meet either or both of the previous two requirements and provide additional reliable and compelling evidence of the start-up entity’s substantial potential for rapid growth and job creation.
- Otherwise merit a favorable exercise of discretion.
A spouse or child of an entrepreneur applying for parole under this rule must demonstrate that he or she:
- Is independently eligible for parole based on significant public benefit or urgent humanitarian reasons; and
- Merits a favorable exercise of discretion.