ENTREPENEURS’ PAROLE RULE

On January 16, 2017, the Department of Homeland Security (DHS) published the regulation benefiting a grant of parole for Foreign Entrepreneurs to live and work in the United States (US).

This regulation is meant for two specific reasons:

1.    To improve the ability, of certain promising start-up founders, to begin growing their companies within the US; and

2.     To improve the U.S.’ economy by increasing capital spending, innovation and job creation.

Pursuant to the rule DHS may use its "parole" authority to grant a period of authorized stay, on a case-by-case basis, to foreign entrepreneurs who demonstrate that their stay in the US would provide a significant public benefit through the potential for rapid business growth and job creation. The new rule will become effective July 17, 2017.

DHS estimates that annually 2,940 entrepreneurs will be eligible to benefit from this program. Eligible entrepreneurs may be granted a stay of up to 30 months, with the possibility of extending the authorized stay by an additional 30 additional months provided they meet certain criteria.

Eligibility may be extended to up to three entrepreneurs per start-up entity, and their respective spouses and children. Entrepreneurs who are granted parole will be eligible to work only for their start-up business. Their spouses, not the children, may apply for work authorization once they enter the US.

To qualify for parole a foreign entrepreneur would need to meet the following criteria:

•    He/she possesses a substantial ownership interest in a start-up entity, which was created in the US within the past five years and has substantial potential for rapid growth and job creation;

•    He/she has a central and active role in the start-up entity such that the entrepreneur is well-positioned to substantially assist with the growth and success of the business;

•    He/she can prove that his or her stay will provide a significant public benefit to the United States based on the applicant’s role as an entrepreneur of the start-up entity by:

◦       Showing that the start-up entity has received a significant investment of capital from certain qualified U.S. investors with established records of successful investments;

◦       Showing that the start-up entity has received significant awards or grants for economic development, research and development, or job creation (or other types of grants or awards typically given to start-up entities) from federal, state or local government entities that regularly provide such awards or grants to start-up entities; or

◦       Showing that they partially meet either or both of the previous two requirements and providing additional reliable and compelling evidence of the start-up entity’s substantial potential for rapid growth and job creation.