The Trump administration has officially put on hold a rule that would allow some foreign entrepreneurs to remain in the U.S. if their companies show promise, drawing harsh criticism from groups worried about talent flight from the domestic technology sector.
In a notice scheduled to be published in the Federal Register Tuesday, the Department of Homeland Security (DHS) said that it will delay the implementation of the so-called International Entrepreneur (IE) rule until next March.
The rule, originally scheduled to go into effect July 17, gives immigrant entrepreneurs a 30-month extension to stay in the U.S., provided their companies are creating jobs. DHS plans to use the additional time to evaluate the rule’s eligibility criteria and, possibly, whether to rescind it altogether.
Technology and investment groups denounced the delay Monday, saying it will hurt America’s ability to attract and keep top entrepreneurial talent. Bobby Franklin, president and chief executive of National Venture Capital Association, said the decision was a “fundamental misunderstanding of the critical role immigrant entrepreneurs play” in the development of U.S. startups.
“At a time when countries around the world are doing all they can to attract and retain talented individuals to come to their shores to build and grow innovative companies, the Trump Administration is signaling its intent to do the exact opposite,” he said in a statement. “Despite this setback, NVCA will continue to educate the Trump Administration on the important role immigrant founders play in growing our economy while advocating for full implementation of the rule.”
Implemented by former President Barack Obama in August, the IE rule is a change to visa eligibility guidelines that allows immigrant entrepreneurs to stay for just over two years if DHS determines that their continued residence provides a “significant public benefit” to the U.S. According to to the rule’s eligibility criteria, foreigners who have received capital investment from U.S. investors or significant awards from federal, state or local governments would be given permission to stay and grow their companies.
Silicon Valley has intensely lobbied the Trump administration to keep the IE rule — commonly called a “startup visa” — because there is no dedicated program under which a foreign entrepreneur can legally reside in the U.S. while building a company. The decision to postpone the rule has rankled tech CEOs such as AOL co-founder Steve Case, who slammed the move on Twitter:
The DHS says that the IE rule is being reconsidered in light of Trump’s January executive order on immigration enforcement. The order declared that the DHS secretary “shall take appropriate action to ensure that parole authority … is exercised in all circumstances only when an individual demonstrates urgent humanitarian reasons or a significant public benefit derived from such parole.” The delay will also give officials more time to field comments from the public about the administration’s proposal to rescind the rule, according to the DHS notice.
Many of Trump’s immigration and trade policies have come under fire from tech sector leaders, who say they will ultimately hurt U.S. companies under pressure from foreign competitors. While Trump has hinted that he supports caps on the H-1B visa program, he also told tech CEOs in June that his administration is working “very diligently” with Congress on immigration so “you can get the people you want.”
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