The move, which won’t require congressional approval, allows people to stay up to five years, provided their startup has significant U.S. investment.
It could soon get a lot easier for foreigners to come to the U.S. to grow their startup.
After failing to get Congress to pass a “startup visa” as part of broad immigration reform, the Obama administration is moving ahead with an alternative that would allow overseas entrepreneurs to live in the U.S. for up to five years to help build a company.
Under a federal rule being formally proposed on Friday, the Department of Homeland Security would be empowered to use its existing authority to allow entrepreneurs to legally work in the country for two years, possibly followed by a one-time three-year extension. While the public will have 45 days to comment, the rules aren’t subject to congressional approval.
Already speaking out in favor of the new rules is PayPal co-founder Max Levchin, who moved to the U.S. from the Soviet Union in 1991.
“I believe that the most promising entrepreneurs from around the world should have the same opportunity I had — the chance to deliver on their potential, here in America,” Levchin said in an email released by the White House.
To be eligible to work in the U.S. under the new rule, the foreigner would have to own at least 15 percent of a U.S.-based startup, have a central role in its operations and have ”potential for rapid business growth and job creation.”
That last qualification could be satisfied by having at least $100,000 in government grants or at least $345,000 in investment from U.S. investors with a track record of backing successful companies. Those who partially satisfy those requirements could still be allowed in with additional evidence of the company’s growth potential.
The change to federal law follows a separate move by financial processing firm Stripe that lets startups incorporate in the U.S. while employees remain based overseas. That program, still in beta, was designed to make it easier for foreign startups to get capital by being based in the U.S.
The move also comes amid a continued debate over what broader changes should be made to immigration law — a dialogue that has stalled amid partisan differences. Creating a “startup visa” was part of the administration’s immigration reform bill which passed the Senate in 2014.
“While there is no substitute for legislation, the administration is taking the steps it can within existing legal authorities to fix as much of our broken immigration system as possible,” administration officials wrote in a blog post.