By Mary Vasilescu
The U.S. Citizenship and Immigration Service (USCIS) recently announced a groundbreaking new proposal to award temporary admission to international industrialists looking to cultivate their business within the United States. USCIS Director, Leon Rodriguez believes that “America’s economy has long benefitted from the contributions of immigrant entrepreneurs, from Main Street to Silicon Valley,” thus, the proposal when finalized, is expected to strengthen the country’s economy, produce jobs, magnetize investment and generate significant revenue. “The International Entrepreneur Rule” would authorize certain international entrepreneurs a temporary stay in the US without a requisite visa.
To be considered for the parole grant under the proposed rule, an eligible entrepreneur will need to demonstrate the following:
- For a newly formed entity, the individual must have at least 15% ownership in a startup organized in the US within the previous 3 years and must have a central role in the business growth and operations;
- The entity must demonstrate potential for rapid growth by showing that the entity has received significant investment of capital of $345,000 or more from qualified U.S. investors (such as venture capital firms, angel investors, or start-up accelerators) with prior investments in successful start-up entities;
- The start-up entity may show the receipt of significant awards or grants from Federal, State or local government entities totaling $100,000 or more.
Alternatively, an applicant who partially meets only one or more of the above may be considered for parole under the rule by providing additional reliable and compelling evidence validation of the entity’s substantial potential for rapid growth and job creation:
- No more than three entrepreneurs may receive parole with respect to any one qualifying entity;
- An applicant (and his or her spouse and minor, unmarried children) generally may be granted an initial parole lasting up to 2 years and parole may be revoked if it is determined that public benefit is not provided;
- The applicant may apply for re-parole for an additional period of up to 3 years by demonstrating that the entity has shown significant growth and continue to have substantial potential for rapid growth and job creation.
- To be considered for re-parole the applicant must continue to be an entrepreneur (at least 10% ownership in the entity) and must continue to have an active and central role in the operations and future growth of the entity.
Additional conditions regarding income and employment relate to parole application. The applicant must maintain household income while in the US that is greater than 400 percent of the Federal poverty line as well as employment by the entity and spouse’s eligibility for employment authorization.
Additionally, a re-parole applicant must demonstrate that:
- The entity received at least $500,000 in additional qualifying funding during the initial parole period;
- The entity reached at least $500,000 in annual revenue, with average annualized revenue growth of at least 20 percent, during the initial parole period;
- The entity created at least 10 full-time jobs for U.S. workers during the initial parole period.
Other reliable and compelling evidence of substantial potential for rapid growth and job creation may be provided.
Public remarks of the anticipated rulemaking is welcomed for 45 days, after which the USCIS will address the comments they have received. The decree will be enacted on the date indicated in the ultimate rule published in the Federal Register. For moreinformation, contact Mary Vasilescu, Wiss’ International tax expert or visit the USCIS website here.
Mary Vasilescu advises clients on the formation, structure and taxation of business ventures, international tax, start-up enterprises and joint ventures in the U.S. and abroad, including mergers and acquisitions, restructuring, and international tax planning. Reach Mary at 973.994.9400 or mvasilescu@wiss.visioncreativegroup.com.