Homepage / Technology / In a blow to the tech industry, Trump shelves a start-up immigrant rule
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Technology

In a blow to the tech industry, Trump shelves a start-up immigrant rule

The Trump administration said it would delay, and probably eliminate down the line, a federal rule that would have let foreign entrepreneurs come to the United States to start companies.

The decision, announced by the federal government on Monday ahead of its official publication on Tuesday, was quickly slammed by business leaders and organizations, especially from the technology sector, which has benefited heavily from start-ups founded by immigrants.

“Today’s announcement is extremely disappointing and represents a fundamental misunderstanding of the critical role immigrant entrepreneurs play in growing the next generation of American companies,” Bobby Franklin, the president and chief executive of the National Venture Capital Association, a trade association for start-up investors, said in a statement.

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He added that even as other countries are going all out to attract entrepreneurs, “the Trump administration is signaling its intent to do the exact opposite.”

The policy being delayed by the Department of Homeland Security, known as the International Entrepreneur Rule, was to go into effect next week, after being approved by President Obama in January during his final days in office.

The rule was enacted to give foreign entrepreneurs who received significant financial backing for new business ventures the ability to come temporarily to the United States to build their companies. Silicon Valley leaders had praised the rule as a kind of “start-up visa.”

The department said it would delay the start date of the rule until March 14 of next year, during which time it will seek public comments on a plan to rescind the rule. The department said it decided to delay the rule after President Trump signed an executive order on improvements to border security and immigration enforcement on Jan. 25, shortly after taking office.

The order required the secretary of the Department of Homeland Security to take action to ensure that “parole authority” — through which the department can temporarily allow individuals into the country without being formally admitted with a visa — be used only on a case-by-case basis and “when an individual demonstrates urgent humanitarian reasons or a significant public benefit derived from such parole.”

The International Entrepreneur Rule was designed to use that authority to effectively give a lift to start-ups. Under the Obama administration, the Department of Homeland Security estimated that nearly 3,000 entrepreneurs would be eligible to come to the United States annually under the rule. They were to be granted stays of up to 30 months, with the chance of extending the stays another 30 months if the entrepreneurs met certain criteria.

To qualify, they had to show that they had raised $250,000 or more for their businesses from established American investors or $100,000 or more in grants from government entities.

Steve Case, an investor who was a founder of AOL, blasted the decision on Twitter. “Big mistake,” he wrote. “Immigrant entrepreneurs are job makers, not job takers.”

Gary Shapiro, chief executive of the Consumer Technology Association, a trade group representing the consumer technology industry, said the delay of the rule would damage American innovation and job creation.

“The 44 immigrant-founded billion-dollar start-ups now in the U.S. have created an average of 760 American jobs per company,” Mr. Shapiro said in a statement. “Without these immigrant entrepreneurs, it is unlikely America would stand as the beacon of innovation that it is today.”

Source: Tech CNBC
In a blow to the tech industry, Trump shelves a start-up immigrant rule

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