By David J. Wilks and Stephen Yale-Loehr
Originally published in Bender’s Immigration Bulletin January 15, 2018
After a five-month delay, U.S. Citizenship and Immigration Services (“USCIS”) announced on December 14, 2017, that it would begin accepting applications for parole under the International Entrepreneur Rule (“IER”)[1]. Promulgated by the USCIS under the Obama administration, the purpose of IER is to allow foreign entrepreneurs to start or scale their businesses in the United States[2]. Currently, there is no visa specifically for founders or key employees of start-up companies. Thus, international entrepreneurs have to fit into one or more existing visa categories. That can be difficult[3]. USCIS proposed to use its executive parole power to authorize entrepreneurs to come and work in the United States temporarily. This program is generally referred to as Entrepreneur Parole.
History of IER
Initially proposed in August 2016[4] IER was based on similar entrepreneurial programs throughout the world. The proposed rule garnered significant industry interest, receiving more than 750 comments during its notice and comment period. Based on these comments, USCIS published the final version of IER on January 17, 2017[5]. The final rule reduced many of the qualifying requirements in the proposed rule, to better reflect the realities of the entrepreneurial industry. However, as discussed below, the qualifying requirements remain strict.
The final rule was set to take effect on July 17, 2017[6]. However, just six days before the effective date, the Trump administration published a rule delaying the effective date until March 14, 2018[7] while it considered whether to eliminate the program. There was no notice and comment period for this new rule delaying IER.
The National Venture Capital Association (“NVCA”) and other parties sued in the U.S. District Court for the District of Columbia, claiming that the Department of Homeland Security (“DHS”) violated the Administrative Procedure Act (“APA”) in delaying implementation of the rule. On December 1, 2017, District Judge James E. Boasberg found in favor of NVCA and vacated the delay rule[8].
As a result of the court order, USCIS is now accepting applications for the IER program. The program may be short- lived, however. DHS submitted a draft proposed rule in November 2017 to the Office of Management and Budget (“OMB”) entitled “Recession of International Entrepreneur Parole.”[9] While this proposed rule has not yet been published, and would require notice and comment before taking effect, it does indicate the administration’s intention of rescinding IER. However, until that happens, the rule is in full effect.
Rollout of the IER
With its announcement that it would begin accepting Entrepreneur Parole, USCIS released Form I-941, Application for Entrepreneur Parole (“I-941”) and its accompanying Instructions for Application for Entrepreneur Parole (“Instructions”)[10]. Unfortunately, the Instructions contained many inconsistencies with the final rule, in many instances requiring the stricter standards of the August 2016 proposed rule. USCIS has acknowledged these inconsistencies, and is working with OMB to correct them. Until then, applicants should complete the form consistently with the requirements contained in the final rule[11].
Entrepreneur Parole Requirements
To qualify for entrepreneur parole, the applying entrepreneur must demonstrate that:
- He or she holds at least a 10% ownership stake in the start-up entity;
- He or she plays a central and active role in the operations of the start-up;
- His or her knowledge, skills, or experience will substantially assist with the growth and success of the start-up;
- The start-up’s formation occurred in the last five years; and
- The start-up has not already been the basis of three previous grants of Entrepreneur[12]
The start-up must also have received substantial capital investment, grants, or awards. These capital requirements are restrictive. To meet the capital requirements, in the eighteen months before the I-941 application, the entrepreneur’s startup must have received an aggregate $100,000 in U.S. government grants or awards, or an aggregate of $250,000 in investment from qualified investors[13].
With respect to governmental grants and awards, the grant or award must come from a U.S. federal, state, or local entity or agency, and may not be part of a contract for goods or services[14]. In addition, the grant or award must be for economic development, research and development, job creation, or another similar monetary award directed at start-ups. Finally, the government agency issuing the grant or award must have a track record of doing so. This cannot be the entity’s first financial award for start-ups.
With respect to investment from qualified investors, the investor must be a U.S. citizen or lawful permanent resident, or be a corporate entity majority owned and controlled (directly or indirectly) by U.S. citizens or lawful permanent residents[15]. In addition, the investor cannot be the entrepreneur, or the parents, spouse, siblings, or children of the entrepreneur[16]. Additionally, the qualified investor cannot be a corporate entity in which the entrepreneur or the entrepreneur’s parents, spouse, siblings, or children have any ownership interest, directly or indirectly.
Furthermore, qualified investors must have a track record of successful start-up investment. In the five years before the I-941 application, each qualified investor must have invested at least $600,000 in other start-up entities[17]. That investment must have resulted in at least two start-up entities generating $500,000 in annual revenue, and averaging 20% annualized revenue growth, or have created five qualified jobs each[18]. The qualified jobs must be full-time (at least thirty-five hours per week), paid, have been in existence for a year, and be filled by U.S. citizens, lawful permanent residents, or other immigrants lawfully authorized to be employed in the United States[19]. Presumably, this would not include nonimmigrants, such as individuals in H-1B, F-1 optional practical training, J-1 academic training, or L-1 visa status.
Given the extensive investment requirements and qualifications, it will be difficult for many entrepreneurs to qualify. Successfully applying for Entrepreneur Parole will require both acquiring the funding, and extensive paperwork from the investor or government entity to show that the investment meets the rule’s requirements.
If only a substantial amount of the capital funding criteria is met, the entrepreneur may provide compelling evidence that the start-up has substantial potential for rapid growth and job creation in lieu of meeting the capital requirements[20]. That said, this would be an act of discretion by USCIS, which may be difficult to obtain in light in the current political climate and the “Buy American and Hire American” Executive Order[21].
Applications must be filed with the Texas Lockbox[22] along with Form I-941, a $1,200 filing fee, and an $85 biometrics fee.
Successful entrepreneurs will be issued an I-797 Notice of Action and an I-512L Authorization for Parole of an Alien into the United States. Canadians may take these documents directly to the U.S.-Canada border to be paroled into the United States. All others must travel to a U.S. consulate to obtain travel documentation, such as a boarding foil. Using the consular documentation, the entrepreneur will then enter the United States, receiving parole at the border.
An entrepreneur granted parole is able to work in the United States for the start-up incident to her or his parole, meaning once paroled into the United States, the entrepreneur does not need to file a separate application for work authorization. The entrepreneur must report any material changes regarding the start-up and the entrepreneur’s role with the start-up during the parole period[23].
Spouses and children may accompany the entrepreneur by filing Form I-131, Application for Travel Document. The filing fee will be $575, and will require an additional $85 biometrics fee[24]. Upon arrival in parole in the United States, spouses will be able to apply for work authorization by filing Form I-765, along with a $410 filing fee.
Extensions of Entrepreneur Parole
Assuming that the administration does not quickly rescind IER, IER authorizes one thirty-month extension of Entrepreneur Parole[25]. As with the initial grant of parole, these requirements may be difficult for many to meet.
To receive an extension of entrepreneur parole, an entrepreneur will need to again file Form I-941, demonstrating that the entrepreneur maintains a five-percent ownership stake in the start-up and continues to provide a public benefit to the United States through her or his role as an entrepreneur of the start-up entity. The entrepreneur will also need to maintain a central and active role with the start-up.
In addition, the entrepreneur must demonstrate that the start-up:
- received $500,000 in qualifying investments, government grants, or government awards;
- created at least five full-time qualified jobs during the initial parole period; or
- reached at least $500,000 in annual revenue and averaged 20% in annual growth during the initial parole [26]
If the start-up does not meet these criteria, the entrepreneur may provide documentation of the start-up’s substantial potential for rapid growth and job creation, which would again be subject to a discretionary determination by USCIS.
Impact of IER
Given the strict requirements of IER, this is not the immigration solution that many entrepreneurs and venture capitalists are looking for. Furthermore, as it is not a congressionally approved visa status, recipients of Entrepreneur Parole are much more susceptible to the political inclinations of the Executive Branch. That said, it does provide a new option for those who currently have no options, for example, a student entrepreneur who does not qualify for H-1B and has exhausted her optional practical training. Additionally, as this is neither an immigrant nor a nonimmigrant visa status, Presidential Proclamation 9645[27] (better known as Travel Ban 3) does not apply. Thus, Entrepreneur Parole could be an option for entrepreneurs currently barred from obtaining immigrant and nonimmigrant visas.
David Wilks (djw@millermayer.com) is an attorney with Miller Mayer LLP (http://www.millermayer.com) in Ithaca, New York. A graduate of Cornell Law School, Mr. Wilks represents multinational corporations, healthcare institutions and providers, investors, universities, small businesses, and individuals in complex business immigration matters. Mr. Wilks currently serves as Vice Chair of the American Immigration Lawyers Association (AILA)’s USCIS Vermont Service Center Liaison Committee, and is a member of the U.S. Alliance for International Entrepreneurs (USAIE).
Stephen Yale-Loehr (syl@millermayer.com) is co-author of Immigration Law and Procedure, the leading immigration law treatise, published by LexisNexis. He also teaches immigration law at Cornell Law School, and is of counsel at Miller Mayer. He chairs AILA’s business immigration response team. He also co-founded USAIE. He graduated from Cornell Law School in 1981 cum laude, where he was Editor-in-Chief of the Cornell International Law Journal. He received AILA’s Elmer Fried award for excellence in teaching in 2001, and AILA’s Edith Lowenstein award for excellence in the practice of immigration law in 2004.
[1] https://www.uscis.gov/humanitarian/humanitarian-parole/international-entrepreneur-parole.
[2] https://www.uscis.gov/news/news-releases/uscis-proposes-rule-to-welcome-international-entrepreneurs.
[3] For an article about the various visa options international entrepreneurs may qualify for, see https://millermayer.com/2016/visa- options-immigrant-entrepreneurs/.
[4] International Entrepreneur Rule, 81 Fed. Reg. 60,129 (Aug. 31, 2016) (proposed rule), at https://www.federalregister.gov/documents/2016/08/31/2016-20663/international-entrepreneur-rule or 21 Bender’s Immigr. Bull. 1086 (App. B) (Sept. 15, 2016).
[5] International Entrepreneur Rule, 82 Fed. Reg. 5238 (Jan. 17, 2017) (final rule) (codified at 8 C.F.R. §212.19), at https://www.federalregister.gov/documents/2017/01/17/2017-00481/international-entrepreneur-rule.
[6] Id.
[8] Nat’l Venture Capital Ass’n v. Duke, 2017 U.S. Dist. LEXIS 197738 (D.D.C. Dec. 1, 2017).
[9] https://www.reginfo.gov/public/do/eAgendaViewRule?pubId=201710&RIN=1615-AC04.
[10] https://www.uscis.gov/I-941.
[11] Id.
[12] 8 C.F.R. §212.19(a).
[13] 8 C.F.R. §212.19(b)(2)(ii).
[14] 8 C.F.R. §212.19(a)(3).
[15] 8 C.F.R. §212.19(a)(5).
[16] 8 C.F.R. §212.19(a)(4). Presumably, the grandparents, aunts, uncles, or cousins of the entrepreneur could be qualified investors.
[17] 8 C.F.R. §212.19(a)(5)(i).
[18] 8 C.F.R. §212.19(a)(5)(ii).
[19] 8 C.F.R. §212.19(a)(6)-(8).
[20] 8 C.F.R. §212.19(b)(2)(iii).
[21] Executive Order 13,788 of April 18, 2017, Buy American and Hire American, 82 Fed. Reg. 18,837 (Apr. 21, 2017) , reprinted at
[22] Bender’s Immigr. Bull. 581 (App. A) (May 1, 2017).
[22] For USPS mailings: USCIS, P.O. Box 650890, Dallas, TX 75265; for FedEx, UPS, or DHL packages: USCIS, Attn: IER, 2501
- State Highway 121 Business, Suite 400, Lewisville, TX 75067.
[23] 8 C.F.R. §212.19(j).
[24] https://www.uscis.gov/humanitarian/humanitarian-parole/international-entrepreneur-parole.
[25] 8 C.F.R. §212.19(d)(3).
[26] 8 C.F.R. §212.19(c)(2).
[27] Donald J. Trump, Proclamation 9645 of September 24, 2017, Enhancing Vetting Capabilities and Processes for Detecting Attempted Entry Into the United States by Terrorists or Other Public-Safety Threats, 82 Fed. Reg. 45,161 (Sept. 27, 2017), reprinted at 22 Bender’s Immigr. Bull. 1198 (App. A) (Oct. 15, 2017).