The Trump administration has delayed the implementation of an Obama-era rule allowing foreign entrepreneurs to set up startups in United States, with reports suggesting that the government may ultimately scrap the rule once and for all.
The International Entrepreneur Rule was scheduled to come into effect July 17, but the Department of Homeland Security issued a memo pushing the launch to March 14, 2018.
A report from the Associated Press says that the current administration is reviewing the rule and might ultimately eliminate it.
Under the rule, a founder needed to have at least $250,000 in funding and substantial ownership in a company less than five years old. Policy analysts expected the program to create between 1 million and 3 million jobs over a period of 10 years.
With the future of the program in doubt, tech advocates say the US is risking its long-term competitiveness and might lose talent to China and Europe.
Foreign immigrants in the US have a history of setting up prospective companies. According to a 2016 study by the National Foundation for American Policy, immigrants have started more than half of America’s startup companies valued at $1 billion dollars or more.
The collective value of the immigrant-founded companies is $168 billion, close to half the value of the stock markets of Russia or Mexico, the report noted.
Although Canada and Mexico have modified their immigration laws in a bid to capture foreign talent, they don’t have a Silicon Valley to groom and finance startups like the US, nor do they have the kind of market that the US can offer.
The news comes barely two months after the Trump administration tightened the H1B visa program, restricting US companies from absorbing high-skilled foreign workers.