Judge Overturns DHS Delay of International Entrepreneur Rule

Good News for International Entrepreneurs and American Industry

"Without these immigrant entrepreneurs, it is unlikely America would stand as the beacon of innovation that it is today."

Those were the words stated by the Consumer Technology Association's Chief Executive Gary Shapiro and echoed among American business professionals when word surfaced that the International Entrepreneur Rule (IER), intended to go into effect July 17th, 2017, had been delayed by the Department of Homeland Security (DHS) until March 14th, 2018. Then, it was likely, the planned program would be eliminated. 

The Obama era initiative was intended to provide greater American accessibility to global innovation by simplifying the granting of temporary parolee status to qualified international entrepreneurs, and it understandably came as somewhat of a shock that such an observably beneficial program would run into opposition. This could seem naive upon considering the Trump Administration's confrontational rhetoric regarding immigration, but the IER seemed to envelope all the merit-based criteria that Mr. Trump at one time appeared to espouse. However, much to the joy of the business and technological community at large, the courts have now intervened. 

A Welcome Ruling

Federal Judge James E. Boasberg has officially ruled in favor of a lawsuit introduced in September by the National Venture Capital Association (NVCA), entrepreneurs and startup companies against the DHS's delay of the new rule. The U.S. District Court granted summary judgment for the Plaintiffs and vacated the postponement rule. Represented by the American Immigration Council and Mayer Brown LLP, the plaintiffs alleged that the DHS violated the Administrative Procedure Act’s requirements to provide notice and solicit comments from the public in advance to implementing the delay. Therefore, as Judge Boesberg has demonstrated concurrence, the United States was being subjected to an unsubstantiated dearth of economic activity that would have been provided if the arrival of these foreign entrepreneurs and their startups had been allowed as decreed.

The Department of Homeland Security issued the delay six days before the IER was supposed to go into effect in an effort to comply with an executive order signed by President Trump on January 25th, 2017 directing the department to only accept parole for applicants that demonstrate a significant public benefit or urgent humanitarian necessity.  The delay between the president's order and the Department of Homeland Security's action regarding the rule was a significant factor in Boasberg’s decision, for which the defendants were unable to provide a rational explanation. Mr. Boasberg was also unable to find any justification or the good cause for the DHS's delay. As a result, and effective immediately following the judge's December 1st ruling, the IER is now supposed to go into effect as the DHS must designate a procedure for accepting the applications. “This decision is going to have substantial and cross-cutting effects to the current administration’s efforts to delay Obama-era rules without going through the proper procedures,” lead attorney Paul Hughes has declared in a statement.

A Public Benefit

Both prospective international entrepreneurs and the industries that will benefit from their flow of innovation into the country joined in cheering the court's decision. The presence of these new startups will without doubt provide an uptick in furthering the nation's economy in addition to providing job growth to Americans, effects that are both inherent in increased innovation and required through the International Entrepreneur Rule's criteria for acceptance. 

However, the battle to keep the U.S. open to these benefits is far from over.

The Trump Administration is still likely planning to ultimately rescind the rule, defying the overwhelmingly documented good that is brought by the presence of international startups and increased depositories of innovation they deliver, even as other countries jump through hoops to encourage these foreign endeavors within their own borders. If the President and the DHS do the opposite and close America's doors to such valuable economic resources as often come in the form of international enterprises and talent, the U.S. will thus abdicate its place as a benchmark for innovation in the global community.

There are two items of importance to note in light of this current reality. First, pressure must be kept on the administration to keep the IER in place and thereby sustain the economic opportunity afforded to the U.S. through an inflow of skilled international entrepreneurs. Second, for those foreign entrepreneurs that would like to seize on the opportunity granted by this unprecedented rule, the time to do so is now.

To read more about the IER and who qualifies under the rule, click here.