Looking for a Start-up Visa? This New Proposal May Be the Alternative
President Obama has proposed a new program that would allow founders of some start-up companies to obtain temporary immigration benefits in the U.S. The proposal will be subject to a 45-day public comment period. Once the U.S. Government has reviewed and considered all public comments, it will make the final revisions to the proposal and publish the final rule for implementation of the program.
Summary of benefits under the new proposal:
The proposed program would allow eligible applicants to be considered for “parole,” which would effectively grant them permission to be in the U.S. and work for the designated start-up entity for an initial period of two (2) years. A renewal period of up to three (3) years would be considered if the entrepreneur and the start-up company continue to provide a significant public benefit.
Proposed requirements under the new start-up program:
Here are some of the proposed eligibility criteria for the start-up company:
- It must be formed within the three years prior to the application for parole;
- It must be formed in the U.S. and operating according to U.S. laws;
- It has substantial potential for rapid growth and job creation, as shown by one of the following three things:
- The start-up is receiving at least $345,000 investment capital from certain qualified U.S. investors; or
- The start-up is receiving awards or grants of at least $100,000 from certain federal, state or local government entities; or
- The start-up is receiving only a part of the third-party investment stated above, but can still show compelling evidence of its potential for rapid growth and job development.
- The co-founder seeking parole has at least 15% ownership interest in the start-up and has an active and central role in its operations.
Examples of a qualified U.S. investor are: a venture capital firm, angel investor or start-up accelerator. In addition, the U.S. investor must have made similar investments during three of the five years preceding the application for parole, and at least two of the start-ups that received the investment generated at least $500,000 in revenue each, or created at least five (5) full-time jobs each.
The types of government entities whose grants would qualify are those with expertise in economic development, research and development and/or job creation. Examples are the U.S. Small Business Administration, the National Institute of Health, the U.S. Economic Development Association, and many others.
The benefits and eligibility criteria described above are not exhaustive and are still subject to change after the public comment period. In addition, the final proposal will likely include additional requirements related to the individual start-up founders themselves (such as income level, background and security checks, etc.), aside from the requirements applicable to the start-up corporation. Therefore, interested applicants should continue to monitor this proposal to ensure that they comply with the requirements of the final program.
Significance of this start-up parole proposal:
The current U.S. immigration law does not offer any straight forward visa options for founders of start-up companies. The two most common types of investment-based immigration options currently on the books are very limited. One option, EB-5, requires an investment amount that is often unattainable by a start-up founder ($500,000 or $1,000,000 of the investor’s personal funds; amount depends on the location of the enterprise). Another, E-1/E-2 treaty visa, does not have a minimum investment amount like the EB-5 program, but it is limited only to nationals of certain countries who have a particular type of international treaty with the U.S.
As a result, the U.S. has been missing out on thousands of brilliant business founders and scientists who could benefit our country through job creation and innovation, but who are otherwise not eligible to live or work in the U.S. under the existing immigration framework.
The start-up parole program would bridge part of the gap in the investment-based U.S. immigration system in three main ways: it would require an investment amount that is more realistic in the start-up industry; it would allow the investment to come from reputable third parties, instead of demanding that the company founder use his/her personal funds; and it would provide entrepreneurship opportunities regardless of the founder’s country of origin.
We will keep you updated on any developments regarding this proposal. If you have any immigration-related questions in the meantime, please contact Attorney Raluca (Luca) Vais-Ottosen at email@example.com or (608) 252-9291.
About the Author
Raluca Vais-Ottosen has assisted numerous clients with Immigration matters ranging from family-based and individual Immigration applications, to employment related visas and I-9 employment eligibility verification issues. In addition to her Immigration practice, she also has an extensive background in Employment Law. She assists companies in a number of areas, including but not limited to claims of workplace discrimination, harassment and retaliation, termination and constructive discharge, workplace investigations by State and Federal agencies, as well as Employment Litigation.
Contact Luca by email or by phone at (608) 252-9291.
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