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Trump administration freezes Obama-era rule that would encourage immigrant entrepreneurs to create jobs in the U.S.

By Jesse Schwartz
Published: August 2nd, 2017

The Trump administration has frozen an Obama-era policy that would support immigrants who want to launch their own businesses in the U.S.

Introduced in August 2016, the International Entrepreneur Rule aimed to give parole visas for up to five years to qualified immigrant entrepreneurs. To prevent fraud and other misuse of the rule, applicants are required to have raised at least $250,000 in start-up capital and received at least $100,000 in U.S. government grants. In addition, immigrating entrepreneurs have to demonstrate their companies’ potential to contribute economic growth and job creation in the U.S.

But at the same time that organizations are being launched to support entrepreneurship as a boon to the nation’s economy (see our post on the new Center for American Entrepreneurship), the Trump administration has made a move that experts say would likely debilitate this collective effort.

The International Entrepreneur Rule was slated to take effect on July 17 this year, but a week prior to that, the Department of Homeland Security (DHS), which oversees the program, delayed it until March 14, 2018. This came after the Trump administration in January froze all new regulations pending reviews.

This move, and the possible elimination of the policy, have sparked criticism from Silicon Valley and other innovation hubs. As Microsoft CEO Satya Nadella puts it, “This is all about how do we create American companies, American jobs and be globally competitive, and in that context, what role can immigration play.”

According to New York City-based immigration lawyer Cyrus D. Mehta, the policy’s potential downsides, such as people attempting to game the system by creating shell companies, would be greatly offset by the rule’s upsides. In January, the DHS estimated that 2,940 immigrant entrepreneurs could be eligible every year for visas under the pending policy. The rule also does not promise entrepreneurs permanent residency or citizenship — they would have to apply for those like anyone else immigrating to the U.S.

“A lot of immigrants have dreams and they want to start their own businesses and make it big in the U.S.,” says Mehta. “This [rule] was one pathway for immigrants to do so, and by not having it or freezing it, we are being less competitive. America needs to realize that it is not the only game in town. There are other countries that want to compete, and we need to be up there. And we are not, unfortunately, by freezing this rule.”

Source: Knowledge@Wharton

Posted under: Tech Transfer e-News

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