“These Efforts Will Fail”: USCIS Lowers Thresholds for IER Startup Program to Attract Foreign Entrepreneurs

Moustafa Daly
Cairo

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On July 12, 2024, U.S. Citizenship and Immigration Services (USCIS) announced significant adjustments to the thresholds in the International Entrepreneur Rule (IER) to make it more accessible and appealing to foreign entrepreneurs aspiring to establish and grow their startups in the United States.

The changes, part of the Biden administration’s efforts to boost immigration among entrepreneurs, provide greater clarity and transparency to the program, which has suffered from uncertainty and low application rates since its inception in the final days of the Obama administration.

But Matthew Galati, lawyer and principal at The Galati Law Firm, anticipates the changes will be ineffective as they don’t address the program’s main shortcomings.

“I am glad to see that USCIS continues to administer this program. However, it is unused. We have never filed one of these applications, and I know of only one colleague who has,” reveals Galati.

“The United States should follow Canada and create a real, bona fide startup visa with better provisions. Parole is no substitute for a nonimmigrant status. Until that happens, these efforts will fail to meet their full potential,” he adds.

When did the US International Entrepreneur Parole Rule start?

The Obama administration first introduced the International Entrepreneur Rule in August 2016 to encourage international entrepreneurs to establish and grow their businesses in the United States. The rule was created under the authority of parole, which allows the Department of Homeland Security (DHS) to grant individuals temporary entry into the US on a case-by-case basis for urgent humanitarian reasons or significant public benefit.

The former Trump administration took steps to delay and ultimately eliminate the program, citing concerns about its legality and potential for abuse. In May 2018, the DHS proposed removing the IER, arguing that it exceeded the agency’s parole authority and that existing visa programs were sufficient to support international entrepreneurs.

Despite these challenges, a federal court vacated the DHS’s delay of the IER in December 2018, allowing the program to take effect. The Biden administration has since sought to revive and enhance the IER as part of its broader efforts to attract global talent and promote economic growth through immigration reform.

Revised IER Eligibility Criteria and Benefits

Under the revised guidelines, the minimum funding thresholds required to demonstrate a startup’s potential for rapid growth and job creation have been lowered. Entrepreneurs can now qualify by securing qualified investments totaling at least $264,147 from qualified investors or obtaining qualified awards or grants of at least $105,659 from federal, state, or local government entities within the 18 months preceding their application.

Moreover, foreign entrepreneurs who meet these criteria can now potentially stay in the US for up to five years, contingent upon their venture’s ability to maintain its growth trajectory and public benefit.

The initial parole period, granted for two and a half years, can be extended if the startup meets additional funding milestones and employment benchmarks.

To be eligible for the IER, entrepreneurs must hold a substantial ownership stake of at least 10% in their startup and play a central, active role in its day-to-day operations and decision-making processes. The startup must have been legally established within the US in the past five years and exhibit strong potential for swift expansion and employment generation.

IER Application Process and Family Considerations

The IER enables entrepreneurs to apply for parole from outside the US, provided they meet all criteria. Those already residing in the country under a different nonimmigrant status may also apply. However, program approval might necessitate a departure and re-entry to activate the parole conditions.

Each startup can have up to three entrepreneurs qualify for parole under the IER. While spouses of these entrepreneurs may also apply for parole and subsequently seek employment authorization, their children are not eligible for work authorization despite being allowed to accompany them.

As the revised International Entrepreneur Rule takes effect, experts expect USCIS to provide further guidance on the application process and documentation requirements for entrepreneurs seeking to benefit from the program.

The agency will also monitor the program’s implementation and impact, making adjustments as necessary to ensure that it achieves its intended goals of attracting and retaining international talent, spurring innovation, and promoting economic growth.

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