By Gary Endelman and Cyrus D. Mehta

While the Obama administration struggles to get votes to overhaul our dysfunctional immigration laws in Congress, http://tinylink.com/?Pky1KrfcfI, and Arizona passes its shameful immigration bill, SB 1070, which legalizes racial profiling, http://tinylink.com/?a2IUa39ATc, there is a growing yearning for Congress to pass Comprehensive Immigration Reform (CIR) that would provide more pathways to visas and permanent residency and legalize the millions who remain undocumented. But do we need to wait endlessly for Congress to Act? We demonstrate in our article Tyranny of Priority Dates, http://scr.bi/i0Lqkz, that it is possible for the Executive to legalize the status of non-citizens without Congressional intervention to achieve something close to CIR.

Work Authorization and Parole

For instance, there is nothing that would bar the USCIS from allowing the beneficiary of an approved employment based I-140 or family based I-130 petition, and derivative family members, to obtain an employment authorization document (EAD) and parole. The Executive, under INA § 212(d)(5), has the authority to grant parole for urgent humanitarian reasons or significant public benefits. The crisis in the priority dates where beneficiaries of petitions may need to wait for green cards in excess of 30 years may qualify for invoking § 212(d)(5) under “urgent humanitarian reasons or significant public benefits.” Similarly, the authors credit David Isaacson who pointed out that the Executive has the authority to grant EAD under INA §274A(h)(3), which defines the term “unauthorized alien” as one who is not “(A) an alien lawfully admitted for permanent residence, or (B) authorized to be so employed by this Act or by the Attorney General” (emphasis added). Under sub paragraph (B), the USCIS may grant an EAD to people who are adversely impacted by the tyranny of priority dates.

Likewise, the beneficiary of an I-130 or I-140 petition who is outside the U.S. can also be paroled into the U.S. before the priority date becomes current. The principal and the applicable derivatives would enjoy permission to work and travel regardless of whether they remained in nonimmigrant visa status. Even those who are undocumented or out of status, but are beneficiaries of approved I-130 and I-140 petitions, can be granted employment authorization and parole. The retroactive grant of parole may also alleviate those who are subject to the three or ten year bars since INA § 212(a)(9)(B)(ii) defines “unlawful presence” as someone who is here “without being admitted or paroled.” Parole, therefore, eliminates the accrual of unlawful presence.

While parole does not constitute an admission, one conceptual difficulty is whether parole can be granted to an individual who is already admitted on a nonimmigrant visa but has overstayed. Since parole is not considered admission, it can be granted more readily to one who entered without inspection. On the other hand, it is possible for the Executive to rescind the grant of admission under INA §212(d)(5), and instead, replace it with the grant parole. As an example, an individual who was admitted in B-2 status and is the beneficiary of an I-130 petition but whose B-2 status has expired can be required to report to the Department of Homeland Security (DHS). who can retroactively rescind the grant of admission in B-2 status and instead be granted parole retroactively.

Historic Role Of Executive In Granting Immigration Benefits

While the authors have proposed the use of parole and EAD benefits to those who are beneficiaries of approved immigrant petitions and are on the path to permanent residency, but for the crushing backlogs in the employment and family quotas, parole and EAD can also be potentially granted to other non-citizens such as DREAM children or those who have paid taxes and are otherwise admissible. The Executive’s use of parole, sua sponte, in such an expansive and aggressive fashion is hardly unique in post-World War II American history. The rescue of Hungarian refugees after the abortive 1956 uprising or the Vietnamese refugees at various points of that conflict comes readily to mind. While these were dramatic examples of international crises, the immigration situation in America today, though more mundane, is no less of a humanitarian emergency with human costs that are every bit as high and damage to the national interest no less long lasting. Even those who are in removal proceedings or have already been ordered removed, and are beneficiaries of approved petitions, will need not wait an eternity for Congress to come to the rescue.

The government has always had the ability to institute Deferred Action, which is a discretionary act not to prosecute or to deport a particular alien. Like our proposal, Deferred Action is purely discretionary. They are both informal ways to allow continued presence in the United States. The INA never mentions deferred action. Neither does deferred action depends upon regulation. Deferred action is not mentioned in Title 8 of the Code of Federal Regulations (“8 C.F.R.”) but only in the old, and now inapplicable, Operations Instructions. Both, our proposals and deferred action, are the products of limitations. The exercise of prosecutorial discretion to grant deferred action status is an expression of limited enforcement resources in the administration of the immigration law. Our advocacy of EAD and Parole outside the adjustment context is an expression of limited EB quotas and the impact of visa retrogression. Since both are inherently discretionary, they are not proper subjects for judicial review since, in both cases, there is no law to apply.

Deferred Action has also been applied to battered spouse and children self-petitioners who had approved I-360 petitions under the Violence Against Women Act, so that they could remain in the United States and obtain work authorization. In 2006, Congress, in recognition of this informal practice, codified at INA § 204(a)(1)(k) the grant of employment authorization to VAWA self-petitioners. Deferred Action has also been granted to U visa applicants. More recently, the DHS provided interim relief to surviving spouses of deceased American citizens and their children who were married for less than two years at the time of the citizen’s death. Mr. Neufeld’s memo, issued on June 15, 2009, provides extraordinary relief to spouses whose citizen spouses died regardless of whether the I-130 petitions were approved, pending or even not filed. Such beneficiaries may request deferred action and obtain an EAD. Then, on October 28, 2009, Congress amended the statute to allow, inter alia, a widow who was married less than two years at the time of the citizen’s death to apply for permanent residence. See Pub. L. No. 111-83, 123 Stat. 2142 (2009).

Even more recently, on November 30, 2009, USCIS announced in a press release that certain affected persons in the Commonwealth of the Northern Mariana Islands (CNMI) would be granted parole under INA § 212(d)(5). The Consolidated Natural Resource Act of 2008 (CNRA) extends most provisions of the United States immigration law to the CNMI beginning on November 28, 2009. As of this date, foreign nationals in the CNMI will be considered present in the United States and subject to U.S. law. In order to avoid their removal from the CNMI, the grant of parole will place individual members of CNMI groups in lawful status under the United States immigration law and permit employment authorization. Parole status will also allow for the issuance of advance parole when the individual seeks to depart the CNMI for a foreign destination.

In another display of Executive legerdemain, in March of 2000, a former INS official Mr. Cronin, in a Memo, http://www.boulettegolden.com/H_and_L_Travel_and_Advance_Parole.pdf, allowed nonimmigrants holding H-1B or L status to travel overseas while their adjustment of status applications were pending and be admitted on advance parole and still be able to work as if they were in H-1B or L status without first obtaining an EAD. The following Q&A extract in Mr. Cronin’s memo is worth noting:

4. If an H-1 or L-1 nonimmigrant has traveled abroad and reentered the United States via advance parole, the alien is accordingly in parole status. How does the interim rule affect that alien’s employment authorization?

A Service memorandum dated August 5, 1997, stated that an ‘adjustment applicant’s otherwise valid and unexpired nonimmigrant employment authorization…is not terminated by his or her temporary departure from the United States, if prior to such departure the applicant obtained advance parole in accordance with 8 CFR 245.2(a)(4)(ii).’ The Service intends to clarify this issue in the final rule. Until then, if the alien’s H-1B or L-1 employment authorization would not have expired, had the alien not left and returned under advance parole, the Service will not consider a paroled adjustment applicant’s failure to obtain a separate employment authorization document to mean that the paroled adjustment applicant engaged in unauthorized employment by working for the H-1 or L-1 employer between the date of his or her parole and the date to be specified in the final rule.

A close examination of this astonishingly creative policy reveals that the Executive presumably allowed such an individual to continue working without any formal work document. Admitting an H-1B on advance parole (and thus presumably as a parolee rather than as an H-1B nonimmigrant), and allowing him or her to extend H-1B status subsequently, while permitting this individual to continue working for the employer without an EAD, required creative thinking on the part of the government. These are a few examples of how the Executive has creatively found ameliorative solutions within the four corners of the INA.

No Violation of Separation of Powers

While some may argue that there is no express Congressional authorization for the Executive to enact such measures, the President may act within a “twilight zone” in which he may have concurrent authority with Congress. See Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 635 (1952) (Jackson, J., concurring). Unlike Youngstown Sheet and Tube Co. v. Sawyer, where the Supreme Court held that the President could not seize a steel mill to resolve a labor dispute without Congressional authorization, the Executive under our proposal is well acting within Congressional authorization. In his famous concurring opinion, Justice Jackson reminded us that, however meritorious, separation of powers itself was not without limit: “While the Constitution diffuses power the better to secure liberty, it also contemplates that practice will integrate the dispersed powers into a workable government. It enjoins upon its branches separateness but interdependence, autonomy but reciprocity.” Id. at 635. Although President Truman did not have authorization to seize the mill to prosecute the Korean War, Justice Jackson laid a three-pronged test to determine whether the President violated the Separation of Powers clause. First, where the President has express or implied authorization by Congress, his authority would be at its maximum. Second, where the President acts in the absence of congressional authority or a denial of authority, the President may still act constitutionally within a “twilight zone” in which he may have concurrent authority with Congress, or in which its distribution is uncertain. Under the second prong, Congressional inertia may enable, if not invite, measures of independent presidential authority. Finally, under the third prong, where the President acts in a way that is incompatible with an express or implied will of Congress, the President’s power is at its lowest and is vulnerable to being unconstitutional.

Under our proposal, the President is likely acting under either prong one or two of Justice Jackson’s tripartite test. We have shown that INA § 212(d)(5), which Congress enacted, authorizes the Executive to grant interim benefits for “urgent humanitarian reasons” or “significant public benefits.” Moreover, INA § 274A(h)(3)(B) provides authority to the Executive to grant employment authorization. Even if such authority is implied and not express, Congress has not overtly prohibited its exertion but displayed a passive acquiescence that reinforces its constitutional legitimacy. Operating in Justice Jackson’s “twilight zone,” such constructive ambiguity creates the opportunity for reform through Executive initiative. From this, we must conclude that, had Congress not enacted INA § 212(d)(5), the President could not act by fiat to broaden or diversify its application beyond the adjustment context. In terms of EAD issuance, Congress has rarely spoken on this except via INA § 274A(h)(3)(B), so that many instances of EAD issuance are purely an act of executive discretion justified by that one statutory provision. Furthermore, INA § 103(3) confers powers on the Secretary of Homeland Security to “establish such regulations, prescribe such forms or bonds, reports, entries and other papers; issue such instructions; and perform such other acts as he deems necessary for carrying out his authority under the provisions of this Act.”

The President is not divorced from lawmaking; that is the very reason why the Framers provided an executive veto power. If the President was totally divorced from the making of laws, why give such a weapon to limit congressional prerogative? Once we accept the fact that the Executive is a junior partner in lawmaking, then the use of executive initiative to promulgate implementing and interpretative regulations, as we propose be done in the grant of parole and EAD benefits, becomes a valid extension of this well settled constitutional precept.

Chevron and Brand X Doctrine

We proffer yet another legal theory to support our proposal. When the Service extended Occupational Practical Training from twelve months to twenty-nine months for STEM students, the Programmers Guild sued DHS. in Programmers Guild v. Chertoff, 08-cv-2666 (D.N.J. 2008), challenging the regulation, and initially seeking an injunction, on the ground that DHS. had invented its own guest worker program without Congressional authorization. The court dismissed the suit for injunction on the ground that DHS was entitled to deference under Chevron USA, Inc. v. Natural Resources Defense Council, Inc. 467 U.S. 837 (1984). Under the oft quoted Chevron doctrine, courts will pay deference to the regulatory interpretation of the agency charged with executing the laws of the United States when there is ambiguity in the statute. The courts will step in only when the agency’s interpretation is irrational or in error. The Chevron doctrine has two parts: Step 1 requires an examination of whether Congress has directly spoken to the precise question at issue. If Congress had clearly spoken, then that is the end of the matter and the agency and the court must give effect to the unambiguous intent of the statute. Step 2 applies when Congress has not clearly spoken, then the agency’s interpretation is given deference if it is based on a permissible construction of the statute, and the court will defer to this interpretation even if it does not agree with it. Similarly, the Supreme Court in Nat’l Cable & Telecomm. Ass’n v. Brand X Internet Servs., 545 U.S. 967 (2005), while affirming Chevron, held that if there is an ambiguous statute requiring agency deference under Chevron Step 2, the agency’s interpretation will also trump a judicial decision interpreting the same statute. Brand X involved a judicial review of an FCC ruling exempting broadband Internet carrier from mandatory regulation under a statute. The Supreme Court observed that the Commission’s interpretation involved a “subject matter that is technical, complex, and dynamic;” therefore, the Court concluded that the Commission is in a far better position to address these questions than the Court because nothing in the Communications Act or the Administrative Procedure Act, according to the Court, made unlawful the Commission’s use of its expert policy judgment to resolve these difficult questions.

The District Court in dismissing the Programmers Guild lawsuit discussed the rulings in Chevron and Brand X to uphold the DHS’s ability to extend the student F-1 OPT regulation. Programmers Guild appealed and the Third Circuit also dismissed the lawsuit based on the fact that the Plaintiffs did not have standing. Programmers Guild, Inc. v. Chertoff, 338 Fed. Appx. 239 (3rd Cir. 2009), petition for cert. filed, (U.S. Nov. 13, 2009) (No. 09-590). While the Third Circuit did not address Chevron or Brand X – there was no need to – it interestingly cited Lorillard v. Pons, 434 U.S. 575, 580 (1978), which held that Congress is presumed to be aware of an administrative interpretation of a statute and to adopt that interpretation when it reenacts its statutes without change. Here, the F-1 practical training regulation was devoid of any reference to the displacement of domestic labor, and Congress chose not to enact any such reference, which is why the Programmers Guild lacked standing.

Brand X tells us that federal agencies and Congress have a commingled role to play in making new law: “Chevron’s premise is that it is for agencies, not courts, to fill statutory gaps.” Is there a more effective constitutional answer to the charge that our argument violates separation of powers? If the FCC can use its policy expertise to exempt broadband Internet carriers from mandatory regulation under the Communications Act, why can’t the USCIS use its policy expertise to extend Parole and broaden EAD issuance, especially since the latter is entirely a creature of regulation? The raison d’être for the Chevron defense that federal agencies are owed deference when they seek to execute the law through regulatory interpretation suggests, if not compels, the conclusion that, while only Congress can enact laws, the executive agencies charged with their enforcement can say what these laws mean, this in turn, determines how they are applied or enforced. Those who argue that we seek to violate the separation of powers doctrine take an artificially cramped view of what lawmaking involves and ignore the fact that, like the idea of judicial review itself, no law can live apart from interpretation that, by its very nature, inevitably changes the law itself.

Chevron and Brand X are more than just constitutional justifications of agency action but an invitation to action where the Congress has stayed its hand. Until now, Brand X has been feared by the immigration bar and immigration advocates for its negative potential as a legitimization of government repression. Yet, it has a positive potential by enabling the Executive to expand individual rights and grant benefits sua sponte. We do not need to live in fear of Brand X. We can make it our own.

While Arizona has restored the relevance of CIR and provided its advocates within the Democratic Party with a new political imperative, the prospects for ultimate passage remain as uncertain as ever. Spurred by their triumph in Arizona, advocates of state immigration laws are moving ahead on a broad front all across the land. We need action now. Set against such a turbulent backdrop, there is a clear and present need for moving forward through executive action to combat the Arizona law and the many copycat versions that are and will continue to appear in other states. Only through such agency initiative can the nativist surge be checked until CIR becomes a reality.

By
Cyrus D. Mehta* and Myriam Jaidi**

On February 2, 2010, the Department of Homeland Security (DHS) published an interim rule, (available at http://tiny.cc/GvK9A), which adopts the Executive Office for Immigration Review (EOIR) rule at 8 Code of Federal Regulations (CFR) § 1003.102 that provides grounds to discipline practitioners for ethical violations. One specific provision, § 1003.102(t), which is the focus of this article, sanctions practitioners for failing to file a Notice of Entry of Appearance or sign pleadings, applications, motions or other filings if they have been engaged in practice and preparation.

The Department of Justice (DOJ) rules at 8 CFR § 1003.102, which were revised on January 20, 2009, significantly expanded the grounds under which a practitioner who practices before the EOIR can be disciplined. These rules can be found on the USCIS website at http://tiny.cc/j1rrs and will become part of the new DHS rule on March 4, 2010, and will extend to practitioners who practice before all of the components of DHS in immigration matters. This article raises preliminary questions about the impact of the specific section, 8 CFR § 1003.102(t), on pro bono clinics and services and illustrates that practitioners need further clarification from DHS to ensure that the rule does not undermine the provision of quality pro bono services.

Immigration practitioners are encouraged, even challenged, to take on pro bono representation and to participate in pro bono clinics. These clinics do a yeoman’s job in providing desperately needed assistance to indigent individuals who are unable to afford counsel and often require assistance on applications that are relatively straight forward and tend to require a simple, though thorough, review by an immigration attorney to spot important issues. In some clinics, non-attorney volunteers also assist in the filling up of applications that are supervised by volunteer lawyers. Typical examples of such applications are the N-400 for naturalization and more recently in the wake of the devastating earthquake in Haiti, the I-829 for Temporary Protected Status applicable to Haitian nationals. The need is significant and has prompted Second Circuit Judge Robert Katzmann and Second Circuit judicial nominee Denny Chin (currently a Federal District Court judge in the Southern District of New York) to bring together judges, private practitioners from large firms and solo offices, academics, clinicians, legal aid providers, and grievance committee members to study what could be done to promote good legal representation for low income immigrants. The reports of the study group are available here, http://tiny.cc/t95Wm.

The rule DHS will adopt on March 4, 2010 and which concerns us here, 8 CFR § 1003.102 (t), sanctions a practitioner who:

t) Fails to submit a signed and completed Notice of Entry of Appearance as Attorney or Representative in compliance with applicable rules and regulations when the practitioner:

(2) Has been deemed to have engaged in a pattern or practice of failing to submit such forms, in compliance with applicable rules and regulations. Notwithstanding the foregoing, in each case where the respondent is represented, every pleading, application, motion, or other filing shall be signed by the practitioner of record in his or her individual name…

The terms “practice” and “preparation” are defined in new sections 8 CFR § 1.1 (i) and (k), as follows:

The term practice means the act or acts of any person appearing in any case, either in person or through the preparation or filing of any brief or other document, paper, application, or petition on behalf of another person or client before or with DHS.

The term preparation, constituting practice, means the study of the facts of a case and the applicable laws, coupled with the giving of advice and auxiliary activities, including the incidental preparation of papers, but does not include the lawful functions of a notary public or service consisting solely of assistance in the completion of blank spaces on printed DHS forms, by one whose remuneration, if any, is nominal and who does not hold himself or herself out as qualified in legal matters or in immigration and naturalization procedure.

As is quite evident, “practice” and especially “preparation” have been defined broadly to encompass pro bono assistance that an attorney may provide at a clinic where he or she may assist numerous individuals in understanding the requirements of and filling out particular applications. After these forms are completed, the applicant is responsible for submitting the application on his or her own to the appropriate filing address. Does this mean that a pro bono volunteer attorney needs to submit a notice of entry of appearance and sign his or her name on, for example, the I-829 or N-400 form? Given that these clinics often include a system whereby some volunteers check individuals in to determine whether they have the necessary documents with them, other volunteers may rove and answer questions raised by individuals as they complete the forms on their own, and another set of volunteers who do a final review of the application and documents, which of these volunteers would be required to sign as the preparer or put in the G-28?

Clearly, this rule was not intended to target pro bono lawyers who render assistance at a pro bono clinic for a deserving cause. The preamble to the proposed rule that sought to expand the grounds for disciplining practitioners in 8 CFR §1003.102, published in the Federal Register at page 44183 (http://tiny.cc/N3Jkt) states,

This provision is intended to address the growing problem of practitioners who seek to avoid the responsibilities of formal representation by routinely failing to submit the required notice of entry appearance forms. Furthermore, the difficulties in pursuing a practitioner for discipline for participating in the preparation of false or misleading documents are apparent when the practitioner fails to submit a completed notice of entry of appearance.

Nevertheless, without clarification, it appears that pro bono attorneys may need to submit a notice of appearance or to sign forms as preparers under 8 CFR § 1003.102(t).

While 8 CFR § 1003.102(t)(2) appears to make the failure to file a notice of entry of appearance a ground of discipline only applicable to one who is deemed to have “engaged in a pattern and practice of failing to submit such forms,” the signing of the form by the practitioner in his or her name is a separate requirement in the next sentence of § 1003.102(t)(2). That sentence indicates that the attorney would be required to sign the forms only where “the respondent is represented . . . by the practitioner of record.” However, considering that “the term representation . . . includes practice and preparation as defined in paragraphs (i) and (k),” 8 CFR § 1.1(m), what triggers the signature requirement is unclear. Overall, the rules do not provide clear guidance as to whether a pro bono attorney who is participating in a clinic to assist individuals who will submit forms pro se must sign as preparer.

The scope of acts that may fall under the rule must be clarified, given that the definition of “practice” includes not just a person appearing in a case, but also includes, through the added definition of “preparation” activities such as “the study of the facts of a case and the applicable laws, coupled with the giving of advice and auxiliary activities, including the incidental preparation of papers…” This definition is broad enough to include acts such as an attorney giving only brief advice through a consultation. Under those circumstances it is virtually impossible for such an attorney to submit a notice of entry of appearance if nothing is prepared or filed after the conclusion of such brief advice. On the other hand, if an attorney assists in the preparation of a motion, pleading or application, or reviews an application prepared pro se by the applicant, in addition to giving the brief advice, and even if the applicant will ultimately file pro se, it would trigger the requirement, at the very minimum, of the attorney signing his or her individual name on the application.

Although the regulations do not target pro bono attorneys, language in the preamble to the EOIR proposed rule indicates that pro bono attorneys are meant to be covered by the rule if their actions are found to fall within the definitions of “practice” and/or “preparation”:

11. Section 1003.102(t)–Notice of Entry of Appearance

73 Fed. Reg at 76914 (July 30, 2008). This fact makes clarification essential to the continued viability of pro bono clinics. In order to meet the challenges proclaimed by Judge Katzmann and the needs presented by human crises, such as the recent devastation caused by the earthquake in Haiti, pro bono attorneys need to know how to proceed when they assist indigent immigrants in preparing applications.

Clearly, 8 CFR § 1003.102 (t) appears to be in conflict with ABA Opinion 07-446 (May 5, 2007), http://tiny.cc/18eBI, which holds, “A lawyer may provide legal assistance to litigants appearing before tribunals ‘pro se’ and help them prepare written submissions without disclosing or ensuring the disclosures of the nature or extent of such assistance.” Although the opinion is not binding and assumes a context in which no law regulates undisclosed advice, it raises the important issues, not contemplated in the preamble or the rule itself, of the right of an individual to proceed pro se without disclosing a lawyer’s involvement, the importance of “unbundling” legal services to allow assistance tailored to a specific need (and this is authorized under ABA Model Rule 1.2(c)), and the question of whether the fact of the assistance is material or the failure to disclose that assistance would constitute fraud in some way.

Although some may question the harm pro bono attorneys are concerned about in signing an application as a preparer, the signing requirement may dissuade volunteers from participating for fear of sanctions or potential litigation against them. Many clinics require individuals seeking assistance to sign a waiver or a limited scope of services agreement in order to protect the sponsoring organization and individuals volunteering from legal action. Most lawyers participating in pro bono clinics do not expect to be sanctioned as a result of reviewing a document or answering simple questions about a form that may be unclear to a non-lawyer. The new rule therefore jeopardizes the availability of pro bono services for the immigrant poor because it fails to clarify the scope of its reach.

The authors suggest that interested bar associations and organizations organizing pro bono clinics around a brief services model send in comments to the DHS rule on or before March 4, 2010 asking for modification of this requirement for pro bono volunteers providing pro se assistance to indigent immigrants.

(The views expressed in this article are solely of the authors and do not represent the views of any of the organizations they have any involvement with, presently or in the past.)

* Cyrus D. Mehta, a graduate of Cambridge University and Columbia Law School, is the Managing Member of Cyrus D. Mehta & Associates, PLLC in New York City. He is also an Adjunct Associate Professor of Law at Brooklyn Law School where he will teach a course on Immigration and Work. Mr. Mehta has received an AV rating from Martindale-Hubbell and is listed in Chambers USA, International Who’s Who of Corporate Immigration Lawyers, Best Lawyers and New York Super Lawyers. Mr. Mehta is a former Chairman of the Board of Trustees of the American Immigration Law Foundation (2004-2006). He was also the Secretary and member of the Executive Committee (2003-2007) and the Chair of the Committee on Immigration and Nationality Law (2000-2003) of the New York City Bar. He is a frequent speaker and writer on various immigration related topics.
** Myriam Jaidi is an Associate with Cyrus D. Mehta & Associates, PLLC where she represents clients on a full range of employment- and family-based immigration matters. Ms. Jaidi received her J.D. from the University of Michigan Law School where she served as Editor-in-Chief of the Michigan Journal of Race & Law and was awarded the Dores McCree Award for Service to the Law School Community. She received her M.A. from Stanford and her B.A. cum laude from Harvard University in History.

*By Poorvi Chothani, Esq.

Recently, the Ministry of Commerce and Industry (the MCI), India announced (the MCI Announcement) that business visas cannot be granted to foreign nationals to work on projects or specific contracts in India. The formal announcement also requires all foreign nationals on such visas to leave India and return on employment visas. Initially they were required to leave before the end of September 30, 2009, but the deadline was later extended by the Ministry of Home Affairs by way of a clarification (the MHA Clarification), till October 31, 2009. Individuals who are in India on business visas in connection with investments, joint ventures or buying and selling industrial products can continue to remain in the country. Both the government communications also state that going forward business visas will only be issued for activities specified in their circulars. However, since the circulars were rather ambiguous the Ministry of Home Affairs published a set of frequently asked questions on October 29, 2009 (the FAQs). These provide some clarity but have not resolved all ambiguities.

Companies and expatriates in India are concerned as many of these foreign nationals are currently in India on business visas and are expected to remain in India for short periods usually to train local personnel, hold meetings or supervise the working of the Indian affiliate.

In addition, hundreds of expatriates have received letters from the Indian Government asking them to leave the country before the deadline and return on appropriate employment visas. Even individuals who have not received such letters but are here on project or contract work were required to leave the country. It is important to note that the Indian company or organization that has engaged foreign nationals to execute projects or contracts will be held responsible for the conduct of the foreign national during his or her stay in India and for the departure of such a foreign national.

Business Visas

In order to highlight the impact of these recent changes this article provides background information about the older system.

Generally, business visas were issued for short term visits or for long term stay depending on the individual’s circumstances. Short Term Business Visas is a term used in this article to differentiate it from the business visas that permitted an individual to remain in India for long periods, which are referred to, here, as Long Term Business Visas.

Short Term Business Visas were issued with a validity of six months or longer while permitting a stay of a maximum of 180 days on each visit. Short Term Business Visas were also issued to individuals who wanted to visit India on business for short term assignments. Intra-company transferees often used the Short Term Business Visas to remain in India for training, supervision, execution of projects, migration of work to outsourcing service providers and other activities. Since a Short Term Business Visa permitted a foreign national to remain in India for not more than 180 days, individuals who wished to remain in India for longer periods would depart from the country and return after a brief absence enabling them to stay for additional periods of 180 days. Some companies rotated the deputation of their representatives in India to avoid a stay of 183 days, which would establish an individual as a resident in India for tax purposes. Indian residents are required to pay income tax in India on their world wide income.

Long Term Business Visas were issued with a validity of periods up to 10 years to foreign nationals from specific countries or to those who have set up or intend to set up business ventures in India. Individuals on a Long Term Business Visa were permitted to stay for extended periods without any limitations per visit or on the cumulative period in India.

The MCI Announcement states that business visas may be only granted to individuals in connection with the following activities and in strict compliance with the Visa Manual for Business Visas.

1. Establish industrial or business ventures in India;
2. Explore possibilities to establish industrial or business ventures; or
3. Purchase or sell industrial products in India.

Since individuals who seek to travel to India in connection with a project or contract do not meet the above mentioned criteria they are ineligible for a business visa and are required to apply for employment visas. This in effect eliminates the Short Term Business Visa.

Summary of FAQs Regarding Business Visas

The FAQs published by the MHA confirm that Business Visas may be granted to individuals who wish to establish or explore the possibility of establishing an industrial or business venture in India or wish to purchase or sell industrial products in India. Additionally, the FAQS provide that a Business Visa can be granted subject to a set of criteria including the financial standing and relevant expertise of the applicant. It cannot be granted to an individual who wishes to come to India in connection with money lending or petty trading or to undertake full time employment in India.

The FAQs also specify that the grant of Business Visas will be subject to any instructions that may be issued by the government of India, based on reciprocity with foreign countries.

The FAQs also provide an indicative list of situations where applicants may be granted a Business Visa. Some of the situations are described below:

1. Foreign nationals coming to set up or explore the possibility of setting up a business or industrial venture in India.
2. Foreign nationals coming to India for technical meetings or attending board meetings or other general meetings for business services support.
3. Foreign experts/specialists coming on a short duration in connection with an on-going project with the objective of monitoring progress, conducting meetings or providing high level technical guidance.
4. Foreign national trainees of multinational companies or corporate houses who wish to attend in-house training conducted at the regional hub of the company located in India.
5. Foreign nationals coming to India to purchase/sell industrial products or commercial products or consumer durables.
6. Foreign nationals coming to India to recruit manpower.
7. Foreign nationals who are partners in a business or are on the Board of Directors of an Indian company.
8. Foreign nationals who wish to participate in, or render consulting services with regard to exhibitions, trade fairs, business fairs, etc.
9. Foreign buyers who come to transact business with suppliers, potential suppliers or to evaluate or monitor quality, provide specifications, place orders, negotiate further supplies etc., in connection with goods or services procured from India.
10. Foreign nationals coming to India for pre-sales or post-sales activity not amounting to actual execution of any contract or project.
11. Foreign students sponsored by AIESEC as interns on project based work in Indian companies or industries.

Employment Visas

The MCI Announcement specified that Employment Visas should be issued in “strict conformity with the Visa Manual” and described its salient points, briefly set out below. Employment Visa will be issued only to:

1. Skilled and qualified professionals; or
2. Persons employed by an Indian entity, including a company, organization, industry or undertaking on contract or employment basis at senior level, skilled positions in the capacity of:
a. Technical experts;
b. Senior executives; or
c. Managerial positions.

The MCI Announcement emphasized that Employment Visas should not be granted for jobs in positions where large numbers of qualified Indians are readily available. Also, Employment Visas should not be granted to individuals who will be employed in routine, ordinary, secretarial or clerical jobs in India.

Further, the MCI Announcement requires all consular missions abroad to return Business Visa applications in connection with project or contract work in India requiring the applicant to reapply for an employment visa.

Summary of FAQs Regarding Employment Visas

The FAQs confirm what the MHA had specified in its earlier announcement that Employment Visas can only be granted to skilled and qualified individuals to undertake non-routine, ordinary, secretarial or clerical jobs for which there are already a large number of qualified Indians.

Additionally, the FAQs clarify that a foreign company that does not have a base in India, in the form of a project or branch office, a subsidiary or a joint venture, cannot sponsor an applicant’s Employment Visa. Indian companies that have awarded a contract to a foreign company can sponsor an applicant’s Employment visa. It is important to note that according to the FAQs, if an Indian company sponsors an applicant on an Employment Visa, the Indian company is not necessarily the employer of the foreign national.

The FAQs also provide an indicative list of situations where applicants may be granted an Employment Visa. Some of the situations are described below:

1. Foreign nationals coming to execute a project or contract irrespective of the duration of the visit.
2. Foreign nationals on short visits to customer locations to repair plants or machinery as part of a warranty or maintenance contract.
3. Foreign experts coming to impart training or to provide technical support/services or to take up employment as coaches in India.
4. Foreign nationals coming as consultants for a fixed remuneration.
5. Self-employed foreign nationals providing skilled services like engineering, medical, accounting, legal or such other highly skilled services as independent consultants.
6. Foreign, interpreters, teachers, chefs and artists employed in hotels, clubs or other organizations.
7. Foreign engineers or technicians coming to India for installation and commissioning of equipment, machines or tools that have been supplied under a contract.
8. Foreign personnel traveling to India in connection with technical support, technical services or transfer of know-how for which the Indian company pays fees/royalty to the foreign company.
9. Foreign sportsmen under time bound contracts with local clubs or organizations.
A foreign company or organization that does not have any Project Office, subsidiary, joint venture or branch office in India cannot sponsor a foreign national as an employee of a foreign company for employment in India.

An Indian company or organization which has awarded a contract for execution of a project to a foreign company, which does not have any base in India, can sponsor an Employment Visa for an employee of that foreign company.

Where to Apply

A very important stipulation in the MCI Announcement stated that employment visas could only be obtained in the applicant’s country of origin. Earlier, consular posts issued visas to third country nationals who could prove that they were residents of the host country where they were applying for the visa. The MCI Announcement would have posed an immense burden on long term residents who would need to travel to their country of nationality to obtain an Indian Business or Employment Visa Thankfully, the FAQs have solved this problem and applicants who have resided in a country for two years or more can now apply at an Indian Consular Post in the host country.

Miscellaneous Provisions

It is important to note that the MCI Announcement makes Indian companies engaging foreign nationals responsible for the conduct of the employees and for their departure from the country. Additionally, individuals and/or employers who violate the visa regime will face penalties, which currently include monetary fines, blacklisting of the employers, deportment, ban on re-entry for the individual, and/or imprisonment. The enforcement authorities exercise wide discretionary powers when determining penalties.

A foreign national will also have to comply with all statutory requirements and pay taxes.

Indian Consular Posts may grant an ‘X’ or dependant visas to the family members of a foreign national granted who has been issued a Business Visa or Employment Visa at their discretion, subject to usual security checks provided the family members are otherwise eligible for such visas. ‘X’ Visas granted in conjunction with a principal applicant’s Employment Visa is likely to be issued to co-terminate with the principal visa. In some instances it may be granted for a shorter duration.

The FAQs also provide a list of documents that should be presented in support of each of the categories and indicates the duration of each type of visa.

It is important to note that the MCI Announcement also prescribes specific procedures for the application and issue of employment visas to Chinese nationals.

Conclusion

We have been advising our clients that all foreign nationals who are still present in India on a Business Visa, and the purpose of their visit does not conform to the stipulations of the FAQs, should depart from India on or before 31 October 2009.

These new stipulations will have a significant impact on foreign nationals wanting to visit India on short term assignments. As per the announcement some of these individuals will now require an Employment Visa as opposed to a Short Term Business Visa. Further, the issuance of a Business or Employment Visa will continue to depend upon the discretion of the consular officer. The change in the visa category would definitely have tax and social security ramifications for the foreign nationals and their employers during their stay in India. Additionally, these changes may also generate corporate tax ramifications in rare cases, depending on the nature of the individual’s activities in India.

It is important that companies seeking to assign foreign nationals to India on a short term basis should assess their projects to identify and comply with visa requirements and tax implications. It is expected that the outcome of a business or employment visa, which will be based on evidence submitted at the time of application will be subject to severe scrutiny to determine the caliber of the applicant and the nature of the job or business in India.

*Poorvi Chothani, Esq. is a founder and managing member of LawQuest, a law firm in Mumbai, India. She is admitted to the New York State Bar with an LL.M from the University of Pennsylvania, USA, and is registered as a Solicitor in England and Wales. Poorvi has been practicing law in India since 1984 and is admitted to the Bar Council of Maharashtra and Goa. She can be reached at poorvi@lawquestinternational.com.
Disclaimer:
The contents of this publication are not a comprehensive consideration of the subjects discussed and are designed to provide preliminary, general information. The Business and Employment Visa Manuals are not available for public inspection. Readers should not conclusively rely on the information as legal advice and should seek independent counsel before any action is taken with respect to these or other specific issues.