Headlines:

1. H-1B Cap Reached for FY 2011 – January 26, 2011, is the “final receipt date” for new H-1B specialty occupation petitions requesting an employment start date in FY 2011.

2. ICE Announces New I-9 Compliance Inspection Center, Partnership With Tyson Foods; Audits Increase – Fifteen additional auditors will focus their efforts on major investigations of the largest companies.

3. State Dept. Announces New Passport Forms Starting March 1 – Applicants should continue to use the current forms to submit a passport application before that date.

4. House Holds Hearing on Worksite Enforcement Issues – Testifying on the panel were Kumar Kibble, ICE Deputy Director, and others.

5. IRS Publishes W-4 Instructions for Nonresident Aliens – The IRS has modified the instructions on the W-4 for nonresidents to reflect restrictions on their filing status, the limited number of exemptions allowed, and the standard deduction.

6. ABIL Global: Hong Kong Makes Changes to Capital Investment Entrant Scheme (CIES) – In the short term, the beneficiary of these changes is the U.S. EB-5 program.

7. New Publications and Items of Interest – New Publications and Items of Interest

8. Member News – Member News

9. Government Agency Links – Government Agency Links

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Details:

1. H-1B Cap Reached for FY 2011

U.S. Citizenship and Immigration Services (USCIS) announced on January 26, 2011, that it has received a sufficient number of H-1B petitions to reach the statutory cap for fiscal year (FY) 2011.

USCIS noted that January 26, 2011, is the “final receipt date” for new H-1B specialty occupation petitions requesting an employment start date in FY 2011. The final receipt date is the date on which USCIS determines that it has received enough cap-subject petitions to reach the limit of 65,000. Properly filed cases will be considered received on the date that USCIS physically receives the petition, not the date that the petition was postmarked. USCIS said it will reject cap-subject petitions for new H-1B specialty occupation workers seeking an employment start date in FY 2011 that arrive after the final receipt date.

USCIS will apply a computer-generated random selection process to all petitions that are subject to the cap and were received on January 26, 2011. USCIS will reject all remaining cap-subject petitions not randomly selected and will return the accompanying fee.

USCIS noted that it will continue to accept and process petitions that are otherwise exempt from the cap. Petitions filed on behalf of current H-1B workers who have been counted previously against the cap will not be counted toward the FY 2011 H-1B cap. Accordingly, USCIS will continue to accept and process petitions filed to:

• extend the amount of time a current H-1B worker may remain in the U.S.;
• change the terms of employment for current H-1B workers;
• allow current H-1B workers to change employers; and
• allow current H-1B workers to work concurrently in a second H-1B position.

U.S. businesses use the H-1B program to employ foreign workers in specialty occupations that require theoretical or technical expertise in specialized fields such as scientists, engineers, or computer programmers.

The announcement is available at http://www.uscis.gov/portal/site/uscis/menuitem.5af9bb95919f35e66f614176543f6d1a/?vgnextoid=7fd9b9138c9cd210VgnVCM100000082ca60aRCRD&vgnextchannel=b56db6f2cae63110VgnVCM1000004718190aRCRD.

 

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2. ICE Announces New I-9 Compliance Inspection Center, Partnership With Tyson Foods; Audits Increase

On January 20, 2011, U.S. Immigration and Customs Enforcement (ICE) announced the creation of an employment compliance inspection center in Crystal City, Virginia. At the center, 15 auditors will support ICE’s worksite enforcement strategy by helping agency field offices around the country expedite employment authorization verification (Form I-9) audits of businesses selected for inspection by ICE. Currently, ICE employs 137 full-time auditors. The 15 additional auditors will focus their efforts on major investigations of the largest companies, ICE Director John Morton said.

From fiscal year 2009 to the present, ICE initiated I-9 inspections of 3,769 businesses across the U.S. Last year, ICE audited 2,200 companies, the largest number of audits the agency has conducted in a year.

ICE also announced the same day that Tyson Foods, Inc., is the newest member of the agency’s nationwide program designed to encourage businesses to collaborate with ICE and use hiring best practices to ensure that they are maintaining a lawful workforce. Tyson Foods Senior Vice President and Chief Human Resources Officer Ken Kimbro and ICE Director John Morton signed the “ICE Mutual Agreement between Government and Employers” (IMAGE) agreement during a ceremony at ICE headquarters.

Tyson Foods, Inc., which employs almost 100,000 people at locations throughout the U.S., is the first major food company to become a full member of ICE’s IMAGE program. The voluntary program allows businesses to partner with ICE as part of their efforts to maintain an authorized workforce and protect themselves from the use of fraudulent identity documents by current or prospective employees. ICE said this program complements ICE’s worksite enforcement strategy, which focuses on holding accountable employers that knowingly hire unauthorized workers to minimize operating costs and boost profits.

To become certified, Tyson was subject to an I-9 audit and other checks by ICE. The company met other IMAGE requirements with programs it already has in place. For example:

• Tyson conducts regular self-assessments or internal audits of its hiring activities. The company also uses an independent outside company to conduct its own audits of the company’s hiring practices.
• Tyson voluntarily participates in the online government employment verification program known as E-Verify. The company also voluntarily uses the “Social Security Number Verification Service.”
• Tyson trains all of its employment managers on the hiring process, proper completion of the I-9, and document examination and fraud detection.

ICE initiated the IMAGE program in 2006. All IMAGE members must participate in the Department of Homeland Security (DHS) E-Verify employment eligibility verification program, which provides an automated link to the Social Security Administration database and DHS immigration records.

Upon enrollment in and commitment to the IMAGE Best Employment Practices, program participants are deemed “IMAGE certified,” a designation DHS and ICE say will become an industry standard. IMAGE also provides employers free training on the I-9 process, fraudulent document detection, and building a solid immigration compliance model.

The press release announcing the new inspection center and the partnership with Tyson Foods is available athttp://www.ice.gov/news/releases/1101/110120washingtondc.htm.

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3. State Dept. Announces New Passport Forms Starting March 1

The Department of State has announced that new passport forms will be available on March 1, 2011. The Department advises that applicants should continue to use the current forms to submit a passport application before that date. Travel.State.Gov and all passport facilities will make the new forms available on March 1, 2011.

The passport forms that are being updated as of March 1 are:

• Form DS-11: Application for a U.S. Passport
• Form DS-82: U.S. Passport Renewal Application for Eligible Individuals
• Form DS-4085: Application for Additional Visa Pages or Miscellaneous Passport Services
• Form DS-5504: Application for a U.S. Passport (Name Change, Data Correction, Limited Passport Replacement)
• Form DS-3053: Statement of Consent or Special Circumstances: Issuance of a Passport to a Minor under Age 16

For more information, see http://www.travel.state.gov/passport/passport_1738.html.

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4. House Holds Hearing on Worksite Enforcement Issues

On January 26, 2011, the House of Representatives’ Subcommittee on Immigration Policy and Enforcement held a hearing on worksite enforcement issues. Testifying on the panel were Kumar Kibble, Deputy Director of U.S. Immigration and Customs Enforcement (ICE); Mark Krikorian, Executive Director, Center for Immigration Studies; Michael Kutler, INS Senior Special Agent, and Daniel Griswold, Director, Center for Trade Policy Studies, Cato Institute.

Mr. Kibble noted that in fiscal year 2010, ICE initiated a record 2,746 worksite enforcement investigations, more than doubling the number of cases initiated in FY 2008. He said ICE is prioritizing the criminal prosecution of employers “who knowingly hire undocumented workers, abuse and exploit their workers, engage in the smuggling or trafficking of their alien workforce, or facilitate document or benefit fraud.” He noted that over the past two years, the Department of Homeland Security “has engaged in record enforcement” and has removed more people in 2009 and 2010 “than in any point in the history of our country, including more than 195,000 criminal aliens last year.”

The full hearing testimony is available at http://judiciary.house.gov/hearings/hear_01262011.html.

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5. IRS Publishes W-4 Instructions for Nonresident Aliens

The Internal Revenue Service has revised “Supplemental Form W-4 Instructions for Nonresident Aliens.” The IRS has modified the instructions on the W-4 for nonresidents to reflect restrictions on their filing status, the limited number of exemptions allowed, and the standard deduction. Nonresident aliens must follow special instructions when completing Form W-4, Employee’s Withholding Allowance Certificate, available at http://www.irs.gov/pub/irs-pdf/fw4.pdf, for compensation paid to such individuals as employees performing dependent personal services in the U.S. Compensation for dependent personal services includes amounts paid as wages, salaries, fees, bonuses, commissions, compensatory scholarships, fellowship income, and similar designations for amounts paid to an employee.

The revised Notice 1392 is available at http://www.irs.gov/pub/irs-pdf/n1392.pdf.

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6. ABIL Global: Hong Kong Makes Changes to Capital Investment Entrant Scheme (CIES)

The Hong Kong Capital Investment Entrant Scheme has been extremely popular. Successful applicants can benefit from one of the premier financial centers of the world with a robust economy and a low, simple and predictable tax regime. Initially launched by the Hong Kong Special Administrative Region (SAR) government in October 2003 to attract investments from qualifying individuals who wished to obtain Hong Kong residency through making a capital investment without the need to establish or join in a business in Hong Kong, as of the end of 2010, 16,600 applications had been received and 8,924 applicants had invested a total of $63.31 billion, representing an average of HKD $7.09 million per entrant.

On October 14, 2010, responding to Hong Kong’s Chief Executive Donald Tsang’s concerns about surging property prices n Hong Kong expressed in his annual policy address, the government temporarily removed real estate from the permissible investment asset classes under the CIES because 40% of the investments in the first half of 2010 had been in real estate.

More specifically, the amendments included the following changes:

i) The threshold of investment (and net assets/net equity requirement) for admission to Hong Kong under the CIES was raised from HK$6.5 million (USD $834,000) to HKD $10 million (USD $1.28M);

ii) Real estate was suspended temporarily as a class of Permissible Investment Assets (PIA) under the CIES; and

iii) An insurer authorized to carry on Class C business as specified in Part 2 of the First Schedule to the Hong Kong Insurance Companies Ordinance became eligible, in addition to banks, to act as a financial intermediary for the purpose of the CIES

The government believes that despite the amendments, the scheme remains competitive compared with the investment programs of other jurisdictions, and promised that the investment threshold (and net assets/net equity requirement) will be reviewed once every three years. With respect to the temporary suspension of real estate as a class of PIA, this decision will be assessed at the next regular review, or earlier as necessary.

In the short term, the beneficiary of these changes is the U.S. EB-5 program, which has become relatively “cheap” at USD $500,000, since Canada’s investment threshold is currently CDN $800,000, while effective January 1, 2011, the Singapore Monetary Authority’s Financial Investor Scheme (FIS) requires applicants to place S $10 million in assets for a continuous period of five years, up from a minimum of S $5 million previously, with a financial institution regulated by the Monetary Authority of Singapore, although a portion – up to $2 million – can be used to buy private residential properties.

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7. New Publications and Items of Interest

GAO report on E-Verify. The U.S. Government Accountability Office (GAO) has published “Employment Verification: Federal Agencies Have Taken Steps To Improve E-Verify, But Significant Challenges Remain.” The GAO found that since June 2008, U.S. Citizenship and Immigration Services (USCIS) has taken several steps to improve the accuracy of the E-Verify system, including expanding the number of databases queried through E-Verify and instituting quality control procedures. As a result, the GAO noted, USCIS data indicate that E-Verify immediately confirmed about 97.4 percent of almost 8.2 million newly hired employees as work authorized during fiscal year 2009, compared to 92 percent from fiscal year 2006 to the second quarter of fiscal year 2007.

However, the GAO found that E-Verify errors persist. Also, if an authorized employee’s name is recorded differently on various authorizing documents, the E-Verify system is to issue a tentative nonconfirmation (TNC) for the employee. Because such TNCs are more likely to affect foreign-born employees, the GAO said, they can lead to the appearance of discrimination. USCIS has not disseminated information to employees advising them of the importance of consistently recording their names on documentation provided to employers, and the GAO concluded that doing so could help USCIS ensure data accuracy. Furthermore, the GAO said that E-Verify remains vulnerable to identity theft and employer fraud.

The GAO found that USCIS has taken steps to minimize risks to the privacy of personal information for new employees who are processed through E-Verify, but that employees are limited in their ability to identify the source of errors and to determine how to correct information in DHS databases that may have led to an erroneous TNC. To identify and access the source of the incorrect data, the GAO noted, employees must use methods such as Privacy Act requests, which, in fiscal year 2009, took an average of 104 days to process. DHS officials acknowledged that the current process for employees to correct their records could be improved and said the agency is discussing ways to provide employees with better access to relevant information.

The GAO also noted that USCIS and the Social Security Administration (SSA) have taken actions to prepare for possible mandatory implementation of E-Verify for all employers nationwide by addressing key practices for effectively managing E-Verify system capacity and availability and coordinating with each other in operating E-Verify. However, the GAO found that USCIS’s lifecycle cost estimates for E-Verify do not reliably depict current costs (i.e., they do not include all costs associated with maintaining and operating E-Verify) and that SSA’s estimates do not consider the risk associated with changes in SSA’s E-Verify workload. Without taking steps to increase reliability and reduce risks, the agencies are at increased risk of not securing sufficient resources to effectively execute program plans in the future, the GAO said.

Meanwhile, on January 18, 2011, House Judiciary Committee Chairman Lamar Smith (R-Tex.) issued a statement on the GAO report. He said that E-Verify is a “remarkably effective tool” and a “very successful program,” and noted that the House is scheduled to hold a hearing to discuss ways to improve and expand the program “to better protect jobs for legal workers.”

The full report is available at http://www.gao.gov/new.items/d11146.pdf. Rep. Smith’s statement is available at http://judiciary.house.gov/news/2011/jan/110118_gao1.html.

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8. Member News

Charles Kuck (bio: https://www.abil.com/lawyers/lawyers-kuck.cfm) has published a new blog entry, “The Rule of Law and Immigration,” which argues that an understanding of the concept of the “rule of law” in the context of the U.S. immigration system might better serve our national debate on immigration and bring us closer to resolving a problem that is not intractable. The blog is available at http://musingsonimmigration.blogspot.com/2011/01/rule-of-law-and-immigration.html.

Cyrus Mehta (bio: https://www.abil.com/lawyers/lawyers-mehta.cfm) spoke on “How to Build and Maintain an Adequate Immigration Compliance Program” at the City Bar of New York on January 13, 2011.

Mr. Mehta has published a new blog entry, “Form I-9 and H-1B Portability.” The blog, which discusses the revised I-9 handbook recently released by U.S. Citizenship and Immigration Services, is available at http://cyrusmehta.blogspot.com/.

Angelo Paparelli (bio: https://www.abil.com/lawyers/lawyers-paparelli.cfm) has posted several new blog entries. “The Nine Best Immigration Practices for U.S.-Inbound Businesses, Entrepreneurs and Investors,” which offers best immigration practices and identifies traps to avoid when a foreign firm or individual plans to start a business in America, is available at http://blogs.ilw.com/angelopaparelli/2011/01/the-9-best-immigration-practices-for-us-inbound-businesses-entrepreneurs-and-investors.html. He notes in his blog entry, “ICE’s New Employment Compliance Inspection Center to Target the Largest U.S. Companies,” that ICE, emboldened by its parade of victories against mostly tiny employers ($7 million in fines against 2,740 firms in 2010), is now poised to target some of America’s largest companies. The blog is available at http://www.electronici9.com/i-9/ices-new-employment-compliance-inspection-center-to-target-the-largest-u-s-companies/.

Steve Trow (bio: https://www.abil.com/lawyers/lawyers-trow.cfm?c=US) was a discussion and panelist in the Webinar, “The Exit Tax Rules for Would-Be Expatriates,” held on January 20, 2011, by the American Immigration Lawyers Association. The Webinar covered the ramifications of U.S. citizens and permanent residents who expatriate, noting that they can be hit with massive income tax liabilities under the latest iteration of the exit tax laws. Their U.S. heirs may have to pay tax when they inherit or receive property from their expatriate parents. The Webinar encouraged expatriates to understand the tax cost of relinquishing citizenship or permanent resident status before they take that fateful step.

Stephen Yale-Loehr (bio: https://www.abil.com/lawyers/lawyers-loehr.cfm) moderated a phone seminar with Department of Commerce officials and other export controls experts concerning the new “deemed export” rule and changes to Form I-129. The seminar was held on February 1, 2011, by the American Immigration Lawyers Association.

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9. Government Agency Links

Follow these links to access current processing times of the USCIS Service Centers and the Department of Labor, or the Department of State’s latest Visa Bulletin with the most recent cut-off dates for visa numbers:

USCIS Service Center processing times online: https://egov.uscis.gov/cris/processTimesDisplay.do

Department of Labor processing times and information on backlogs: http://www.foreignlaborcert.doleta.gov/times.cfm

Department of State Visa Bulletin: http://travel.state.gov/visa/bulletin/bulletin_1360.html

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