us visa options for foreign entrepreneurs

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Introductions!

3333 Bowers Avenue Suite 130 Santa Clara CA 95054

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Email: [email protected] Web: www.khandelwalaw.com

• Immigrant myself!

• Owner/Principal Attorney- Law Office of Sweta

Khandelwal based in the Bay Area

• Chair, Silicon Valley, American Immigration

Lawyers Association (AILA)

• Advocacy & Media Liaison, AILA

• “Top 40 under 40” Immigration Attorneys in CA

• Understanding of how US Immigration laws

intersect with entrepreneurship

• Overview of various work visas that can be used

by foreign entrepreneurs and start-ups

• Appreciate how seeming small changes in fact

patters can effect available visa options


Welcome!

Employment Based US Visas for Entrepreneurs, Start-ups, and Small Businesses Capital Factory, Austin, TX January 21st 2014

Sweta Khandelwal Principal Attorney Law Office of Sweta Khandelwal


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Disclaimer


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This presentation is not intended to

give legal advice. It is for

informational purposes only. It is

geared to help participants get a basic

understanding on how immigration law

and practice intersect with

entrepreneurship.


• Importance of Immigration

• Key non-immigrant work visas (NIV) or temporary visas

• Key immigrant work visas (IV) or permanent visas or Green Cards

• Case Study: Apply elements to potential scenarios

Agenda/ Roadmap

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Why

Immigration

USCIS &

Entrepreneurs

Approach

Potential

Problem

Description

• Get creative

• Explore all

options

• Be-proactive

• Stay informed

• 25% of high-tech companies founded between 1995-2005 had at least one immigrant founder

– Founders on right visa to ensure continuity of the company

– Able to hire top global talent

• Entrepreneurs in Residence Initiative

– Shift in policy towards entrepreneurs

– Old Wine in a New Bottle-Old Laws, New Business

• Creative & Customized – no one size fits all

– Structure business accordingly

– Plan really ahead

• Lack of standardization in applying laws

– Laws have “gray areas”

• Best immigration decisions are usually not good for business

Entrepreneurs, Start-ups & Immigration

Why is knowledge of US Visas critical to foreign entrepreneurs?

Notes: (1) TBD

(2) TBD

Source: Source 1; Source 2; Source 3


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Area



• Key Non-immigrant work visas

• Key Immigrant Work Visas


Agenda/ Roadmap

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• Useful in the preliminary stages • Limited purpose • No employment in the US • No remuneration

• Practical training- up to 12 months; +17 (STEM) • Full time & Part-time; multiple jobs • No minimum wage required

• Available to Treaty Nationals (TN) • Investor or Managers or Critical Employee • At least 50% of business must be owned by TN • Business must be controlled by TN

Non Immigrant/Temporary Visa Options

Relatively easy, quick and economical!

Visitors

B-1& Visa

Waiver

Program

Students

F-1 & OPT

Investors &

their E’ees

E-2

1

2

3

Type of visa

Notes: (1) TBD

(2) TBD



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Typical purpose/ applicability

Not applicable for India and China


• Existing foreign business can set up “affiliated” US business

• E’ee employed by overseas business for at least 1 year out of the preceding 3 years

• Managers(L-1A) & Special. Knowledge workers (L-1B)

• Used for “Specialized Occupation” workers • Foreign National must have a Bachelor’s Degree • Only NIV for US Companies!

• Available for people in the arts, sciences or business who are at the “top of their fields”

• Must meet at least 3 criterion prescribed in law

Non Immigrant/Temporary Visa Options

Relatively easy, quick and economical!

Inter-Co.

Transfer

L-1 Visa

Professional

Worker

H-1B Visa

Extra-ordinary

Ability

O-1 Visa

4

5

6

Type of visa

Notes: (1) TBD

(2) TBD



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Typical purpose/ applicability


Visitor Visas: B-1 & Visa Waiver Program

(VWP)


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Temporary visitor for business

Both B-1 & VWP to be used for limited purposes

• Negotiate contracts • Attend meetings

conferences • Independent

research

VWP

• 37 participating

countries

• Cannot change or

adjust status

• 90 Day Limit

• Can still apply for B-1

Who is eligible

What it takes to succeed

What's great? What sucks

Must demonstrate non-immigrant intent

Cannot be employed in the US

No remuneration to be received

Convenient, economical

Quick process

Great during

early/planning stages

Law unclear as to what

activities are permitted

and what are not

No appeal against

denial-must reapply


Student Visa: F-1 & OPT


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Who is eligible

Those who are studying

full time (Grad. Undergrad.

Ph.D. in accredited

schools

Generally, no employment

while student is in school

Up to 12 months of

training/work permit after

completion of program

17 additional months for

STEM graduates

STEM only for E-Verified

Companies



Completion of your academic program!

Importance of accredited/reputed schools

Cannot be out of job for more than 90 days during

OPT period

STEM extension must be timely applied

Great for start-ups-

incubator/accelerator

No wage requirement

Full time, part-time,

multiple jobs

Cap-Gap solved

Nothing-It’s a great

option!

Limited duration-29

months max; must then

move to another visa

Timing issues


Visa for Investors & their Employees: E-2


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Who is eligible

Those from E-2 country list-

Treaty Nationals

Investors who develop &

direct the US Company

Executive/Manager/Critical

Employees/Special. Know

Treaty Nationals must own

at least 50% of the business

Generally, all nationals must

be from the same Treaty

country

If 2 nationalities involved,

both must have equal

ownership & control


What’s Great? What sucks

Investment that is “at risk”-irrevocably committed

Business is substantial; more than marginal return

Great business plan required

Source of funds must be legitimate-gifts, salary, o.k

Money could have been earned in US or abroad

Loans-only those secured by personal assets

G

No high threshold

investment$

Can use intangible assets

if properly valued

Spouse of E-2 can work

Problem with VC funding-

control/ownership

No set min. $ investment-

unclear

No immigrant intent-no

path towards GC


Inter-Company Transfer: L-1 Visa


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Who is eligible

Foreign business can set

up an “affiliated” US

business

Affiliate relationship

defined in law

FN must be employed by

the overseas company

for at least 1 yr. in the

preceding 3 years

Both owner/employee

may be eligible

New Office vs.

Established Office



Eligibility requirements critical

Both Foreign and US Company must be in business

Evidence of relationship between the two companies

to be extensively documented

Great for overseas co.

No min. salary reqd.

No fixed no. of visas

CEO can spend time in

US and home country

GC for L-1A-EB-1

L-1A for owners & small

business is tougher

New Office L-1 req.

Proving 1 year

employment when no

salary


What sucks

Specialty Occupation Visa: H-1B


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Who is eligible

Visa for Professionals

Position must be a

specialty occupation

Foreign National must

have a Bachelor’s Degree

Visa tied to the sponsor

company


What's great?

An organization structure that establishes an

employer/employee relationship b/w US business &

Foreign National (FN)

Proof that there is enough work/specialty occupation

for the duration of the petition

A great story!

Once FN is on H-1B,

can change between

employers with relative

ease

Part-time and full time

Limited visas-Quota

For founders, e’er/e’ee

relationship is hard

Specialty occupation for

founders is a challenge

Minimum salary-high

TN Visa-Professionals Canadians & Mexicans-no self employment


Visa for Extra-Ordinary Ability: O-1 Visa


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An individual who has extra-ordinary ability in the arts, sciences and business

Sustained national/international acclaim

Distinction in the field

Visa focus on person, as opposed to company

Must show that FN meets at least 3 of the eligibility criterion

Who is eligible


What’s great? What sucks

• National/Internationally recognized award

• Membership in assoc. in the field based on ability

• Published material in trade journal or other media

• Judging the work of others

• Scholarly articles in the field; original contribution

• Prestigious org., critical capacity, high salary

No Quota

No restriction on salary

Renewed indefinitely

A path to GC-EB-1

Room for creative

lawyering!

Burden of proof is high

Not everyone can

qualify






Agenda/ Roadmap

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Three categories; two relevant here

Extraordinary Ability Workers –O-1?

Multinational Executive & Managers-L-1?

Not really useful for entrepreneurs

Investor based GC

Investment must meet all established criterion

$500,000-$1,000,000

Immigrant/Permanent Visa Options

Challenging, time consuming, and expensive!

EB-1

EB-2/EB-3

EB-5

1

2

3

Type of visa

Notes: (1) TBD

(2) TBD



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Eligibility requirements


Employment Based Immigrant Visa: EB-1


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Available to three groups:

Extraordinary Ability

(similar to O visa);

Multinational

Exec./Man. (relevant

for those on L-1A

visas);

Professors and

Researchers

Who is Eligible



Extraordinary Ability-outstanding achievers

Multinational Executives& Managers-L-1A-must show that

FN has managerial duties and supervises over

professionals

No Labor Cert.

required

For Extr. Ability no

employer is required

Visa Bulletin is

current-India & China

Burden of Proof –high-

higher than NIV


Employment Based Immigrant Visa: EB-52


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Any investor willing to

invest at least $1 million of their own funds; or $500,000 if investment is in a TEA

Investment must be in a

New Commercial Enterprise

The business must employ at least 10 US workers full time

Investor must be involved in day to day management of the company

Conditional GC issued for 2 years

Who is Eligible What it takes to succeed


Demonstrate the source of funds-own and legit

Two years to show that all conditions have been met

A comprehensive business plan required

Loans o.k so long as secured by personal assets

Investment must be “at risk”

Investor gets Green

Card for entire family

$500,000 Invest. can me

made in Regional Centers

while investor works on

his/her own business

Model not suitable for

entrepreneurs

Requires investment of

own money in business






Agenda/ Roadmap

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Launching a cool mobile payments

business in France

Clemente –

French

Application

Developer Par

Excellence

Moracio–

Italian

Brillianto

Hacker

Jean Paul–

French

Technologist

with business

mindset

• Bachelors

Engineering- wants

to do an MBA in

the US

• No formal degree

in Engineering-

Wants to get one in

the US

Status of their start-up

Working on an IPhone/Android app. that they claim

will revolutionize the way handheld devices are used

to make payments

Bootstrap efforts /money to create a beta version

Incorporate a business entity in France

• Bachelors degree

in Engineering;

considering a

Master’s


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Successful Trip to the US

Clemente and Moracio enter the US on the Visa

Waiver Program

Participate and win $100000 in the grand

hackathon-Can they?

Incorporate a company in the US- Should they?

Chong:

Chinese PhD

student

Dr. Daring-

Chong’s

advisor and

USC

Santiago

Mexicano:

Eng. graduate

looking for a job

“Keen on the business- tell

me more”

“Have contacts with VC :

Can I help”


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Win

hac

ka

tho

n

Me

et

so

me

peo

ple


Best for Business vs. Best for Immigration

Decisions to be made

Structure: Who will be CEO

Investment: How little/much can we invest ?

Funding: Can we get VCs to show interest ?

School: Can we go to Grad/ MBA school? Can

we work in the business while at school?

Payouts: Salary ? Dividend? None?

Business continuity: someone in France to

manage? Travel between US and France?


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What are available visa options?

Scenario 1: Trio do not invest own $ in

the business

Clemente –

Application

Developer ;

goes for MBA

Moracio–Italian

Brillianto Hacker

thinks school not

worth it!

Jean Paul–French

Technologist with

business mindset

comes to the US to

meet VCs and gets

Dr. Daring-USC on

BOD –VC

This is what they do


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Clemente No Change of Status from VWP to other

NIV

F-1; 12 months OPT; then

Choice: O-1 vs. H-1B

OPT then H-1B

• Cap/Gap

• Quota

Moracio

O-1-CEO?

Jean Paul

B-1 or VWP for now

H-1B

Santiago

May work on TN Problems with H-1B?

Remember-H-1B must be paid a certain salary

What about the E-2?


Now, What are available visa options?

Scenario 1: Trio do not invest own $ in

the business

Clemente –

Application

Developer

drops plan for

school

Moracio–Italian

Brillianto Hacker

decides to opt for

formal education

Jean Paul–French

Technologist with

business mindset

manage the business

from France-gets

French VC

But they do things

differently


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1. Moracio

Can’t join co. unless finishes school (Eng.)

After school, 29 months OPT

2. Clemente

Can be an E-2 employee as

long as 50% co. owned by French nationals

Moracio can work on OPT & have a minor stake in the company-

Problem with dual nationality if Moracio wants to come in on E-2; H-1B better?

3. Jean Paul

Can come on E-2

L-1 after at least a year so long as French entity is active and “affiliated” with US co.

4. Santiago

May work on TN

What about the E-2-now that we

have VC?


What are available visa options?

Scenario 2: Trio do invest own $ in the

business

Clemente –

Application

Developer $

Moracio–Italian

Brillianto Hacker

$$

Jean Paul–French

Technologist with

business mindset

$

This is what they do


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1. E-2 for all

So long as business in owned and controlled equally by nationals of both Treaty countries

2. H-1B for any

Will benefit if at least 1 USC on BOD; and H-1B holder does not have majority stake

3. O-1 for Clemente & Moracio

Possible. O-1 focused on individual more than company

4. Jean Paul

L-1 after a year; may shuttle b/w US & France so long as majority work/time in US

In all scenarios Santiago may work on TN


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