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USA: What's the difference between IEP and the latest proposed startup visa?

By

Sophie Alcorn

Posted

October 15, 2021

at

11:29 AM

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What's the difference between the International Entrepreneur Parole and the proposed LIKE Act?

Like a non-immigrant visa, the International Entrepreneur Parole (IEP) allows its holder to stay temporarily in the United States. However, IEP is not a visa, so the process in which it is given and extended is different from visas. U.S. Rep. Zoe Lofgren (D-CA) recently introduced the Let Immigrants Kickstart Employment (LIKE) Act, which creates both a startup visa and a startup green card.

startup pic 3.jpeg

The qualifying requirements for IEP and Lofgren’s proposed startup visa are similar. However, the proposed startup visa would be easier to obtain and extend and would offer a direct path to a green card as well as a new visa for early-stage employees. Currently, up to three co-founders from the same startup are eligible for IEP. U.S. Citizenship and Immigration Services (USCIS) recently announced that it’s adjusting the minimum monetary requirements for inflation with new amounts set to take effect October 1, 2021:

Both IEP and the proposed startup visa require:

  • A startup founder to have at least a 10% ownership interest in the startup.
  • The founder plays a central and active role in managing the startup.
  • Within the last 18 months prior to filing, the startup has received at least $250,000 in qualifying investments for the LIKE Act or $264,147 for IEP (adjusted for inflation).
  • Or, within the last 18 months prior to filing, the startup has received at least $100,000 in government awards or grants for the LIKE Act or $105,659 for IEP (adjusted for inflation).
  • Or, for IEP, the startup can show “other reliable and compelling evidence of the startup entity’s substantial potential for rapid growth and job creation.”

Renewal of both IEP and the proposed startup visa requires:

  • A startup founder to have at least a 5% ownership interest in the startup.
  • The founder continues to play a central and active role in managing the startup.

And one of the following:

  • During the individual’s stay in the U.S., the startup received at least $500,000 in investments, government awards or grants for the LIKE Act and $633,952 for IEP (adjusted for inflation).
  • Or the startup created at least five qualified full-time jobs.
  • Or the startup generated at least $500,000 in annual revenue in the United States and averaged 20% in average annual revenue growth for the LIKE Act and $528,293 for IEP (adjusted for inflation).
  • Under both IEP and the proposed startup visa, your spouse and children would be allowed to stay in the U.S. with you, and a spouse is eligible to apply for a work permit. Up to three co-founders from the same startup are eligible to apply for IEP. In contrast, there is no limit on the number of co-founders from the same startup that may apply under the proposed LIKE Act as long as each meets the ownership interest requirement.

In addition, under Lofgren’s proposed legislation, there would also be a new visa program for essential employees. If they don’t have an ownership stake or meet the ownership requirements, they might still be able to qualify for another type of employee startup visa depending on how many full-time U.S. employees the startup would have.

IEP process

As always, we recommend hiring an experienced immigration attorney to assist you with your immigration matters.

If USCIS approves your IEP application, you would receive a parole document that is valid for 30 months and can be extended once for another 30 months if you and your startup meet the extension criteria. However, USCIS approval alone does not grant you and your family parole.

A U.S. Customs and Border Patrol (CBP) officer at an airport or other U.S. port of entry has the discretion to approve or deny your parole, so your immigration attorney should prepare you for the types of questions you may be asked by CBP. If you and your family are currently in the U.S., there is currently no “change of status” process. Instead, your attorney would probably advise you that you would need to physically depart the U.S. and show your parole documents to the CBP officer upon reentry at a land border.

Or, if you and your family plan to enter the U.S. via airplane or boat, you would need to go to a U.S. embassy or consulate to obtain a boarding foil — or travel foil — which will enable you to board an airplane or boat since you won’t have a visa foil (commonly called a visa “stamp”) in your passport.

Customs officials typically grant entrepreneurs entry in IEP status in one-year increments rather than the full 30 months, which means you might have to go through this process every year.

In contrast, if and when the LIKE Act becomes law, USCIS would likely process a startup visa like any other visa: You would be able to apply either from within the United States by filing an application for a change of status to a startup status, or apply for a visa abroad at a U.S. embassy or consulate. The proposed startup visa would be valid initially for three years and can be extended for up to another five years if the startup creates jobs and generates substantial revenue. The startup visa legislation also gives entrepreneurs and essential employees a 60-day grace period to leave the U.S. once their startup visa ends, which IEP lacks.

Lofgren’s bill would also create a startup green card that is exempt from the annual quotas that apply to most other green cards. That’s significant given that many international entrepreneurs are waiting several years or even decades for a U.S. green card due to per-country quotas.

Sophie Alcorn is an attorney and Board Certified as a Specialist in United States Immigration and Nationality Law by the State Bar of California.

Connect with Sophie today and request a consultation to address the specifics of your immigration questions.

Alcorn Immigration Law is a leading U.S. advisory law firm for technology-based companies

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