How to Comply with Complex Foreign, Dual and Third Country National Rules Nelson G. Dong Olga King Partner Global Trade Compliance Manager Dorsey & Whitney LLP Esterline Corporation Seattle, Washington Bellevue, Washington #ACIITAR U.S IMMIGRATION AND THE U.S. TECHNOLOGY WORKFORCE by Nelson G. Dong Dorsey & Whitney LLP Seattle, Washington #ACIITAR PROFESSIONAL BACKGROUND • Seattle partner in 550-attorney international law firm • Head of Dorsey & Whitney’s National Security Law Group and co-head of its Asian Law Group • International technology lawyer with >30 years experience in global business • Export control adviser to many technology companies, universities, engineering societies • Frequent speaker, writer, commentator on U.S. export control laws and export control policy advisor to U.S. Commerce Department; member of PECSEA • White House Fellow, former Justice Department official and federal prosecutor #ACIITAR AMERICA’S GLOBALIZED WORKFORCE AND CONTRIBUTIONS MADE BY IMMIGRANTS #ACIITAR IMMIGRANTS & AMERICAN MAJOR LEAGUE SPORTS (2012) • Major League Soccer: 184 of 487 players are foreign born from 57 countries (38% of all players) • Major League Baseball: 272 of 1,029 players are foreign born from 18 countries (26% of all players) • National Hockey League: 193 of 764 players are foreign born from 19 countries (25% of all players) • National Basketball Association: 87 of 434 players are foreign born from 40 countries (20% of all players) Source: Elias Sports Bureau, in July 15, 2012 Seattle Times #ACIITAR A LOCAL CASE STUDY: THE SEATTLE SOUNDERS SOCCER TEAM (2013) • Current Sounders first team roster of 29 players includes 10 players from 10 other nations • Americas: Brazil, Costa Rica, Guatemala • Caribbean: Cuba, Grenada, Jamaica • Europe: England, France, Switzerland, • Africa: Nigeria Source: SoundersFC.com #ACIITAR IMMIGRANTS AND ATOMIC ENERGY Hans Bethe Felix Bloch Albert Einstein Enrico Fermi Otto Frisch George Kistiakowsky Leo Szilard Edward Teller Theodore John Eugene Wigner von Kármán von Neumann #ACIITAR IMMIGRANTS AND MISSILE TECHNOLOGY Operation Paperclip Fort Bliss, TX (1945-46) Dr. Wernher von Braun and 125 others #ACIITAR IMMIGRANTS & MODERN U.S. INDUSTRY ANDREW S. GROVE (1936 - ) (Hungary) – Developer of basic semiconductor technologies – Co-founder of Intel Corporation IGOR SIKORSKY (1889-1972) (Russia) – Designer of first four-engine airplane, modern helicopter – Founded Sikorsky Aircraft Corporation (now part of UTC) TSU WONG (1893-1965) (China) – 1916 engineering graduate of MIT – Hired as Boeing’s first Chief Engineer; designed its first Model C training seaplane sold to U.S. Navy #ACIITAR IMMIGRANTS & U.S. INNOVATION • June 2011 study by Partnership for New American Economy entitled The “New American” Fortune 500: • More than 40% of 2010 Fortune 500 companies founded by immigrants or children of immigrants • Almost 20% of newest Fortune 500 companies (i.e., founded since 1985) founded by an immigrant • Fortune 500 companies founded by immigrants or children of immigrants employ > 10 million workers worldwide, with those founded by immigrants employing 3.6 million • Fortune 500 companies founded by immigrants or children of immigrants had combined revenues of US$4.2 trillion, which is more than GDP of every country in world except U.S., China and Japan • Familiar corporate names: AT&T, Boeing, Ford, GE, Google, Heinz, Hertz, Home Depot, Kraft, Mattel, McDonald’s, P&G #ACIITAR IMMIGRANTS & U.S. INNOVATION • Aug. 2007 study by scholars at Duke, NYU and Harvard (V. Wadhwa, et al.): • Immigrant inventors produced 72% of Qualcomm’s patents, 65% of Merck’s patents, 64% of GE’s patents and 41% of U.S. Government worker patents • Sept. 2008 study by economists at McGill University and Princeton University (NBER Working Paper 14312): • Immigrants obtain U.S. patents at double the rate that native born Americans do because immigrants disproportionately represented in science, technology, engineering and math (STEM) fields in U.S. • Projection: each 1% increase in immigrant college graduates will yield 15% increase in patents per capita #ACIITAR IMMIGRANTS & U.S. INNOVATION • June 2012 study by Partnership for New American Economy entitled Patent Pending: How Immigrants are Reinventing America: • 76% of 1,466 patents issued in 2011 to top 10 U.S. research universities (ranked by patent activity) had at least one foreign born inventor (faculty member, staff or student) • Foreign born inventors involved in 87% of semiconductor manufacturing, 84% of information technology, 83% of pulse or digital communications, 79% of pharmaceutical and drug and 77% of optics inventions covered by issued patents • Foreign born inventors within 1,466 issued U.S. patents came from 88 different countries around the world • 10 universities surveyed in PNEA study: California*, Stanford, MIT, Wisconsin (Madison campus), Texas*, Cal Tech, Illinois*, Michigan*, Cornell, Georgia Tech * State university system as a whole #ACIITAR AMERICA’S PIPELINE OF FUTURE SCIENTISTS AND ENGINEERS #ACIITAR U.S. COLLEGES AND UNIVERSITIES AND FOREIGN STUDENTS • In 2012-13 academic year, more foreign students attended U.S. universities than ever before: • 819,644 foreign students studied at U.S. universities • Foreign student enrollment in U.S. grew 7% over the prior year • Top countries sending foreign students in U.S.: • China: 237,697 (29%) • India: 98,357 (12%) • South Korea: 73,768 (9%) • Saudi Arabia: 40,982 (5%) • Canada: 24,589 (3%) • 49% of international students come from China, India, and South Korea. Source: Institute of International Education (2014) #ACIITAR U.S. COLLEGES AND UNIVERSITIES AND FOREIGN STUDENTS (cont.) • Top three states for foreign student enrollment: California, New York, Texas • Top 5 fields of study by foreign students in U.S. (2012-13 data): • Business and management (22%) • Engineering (19%) • Mathematics and computer science (10%) • Social sciences (9%) • Physical and life sciences (8%) Source: Institute of International Education (2014) #ACIITAR FOREIGN-BORN STEM STUDENTS #ACIITAR U.S. IMMIGRATION LAWS & COMMONLY AVAILABLE VISAS #ACIITAR H-1B VISA OVERVIEW • Temporary work visa for professionals • Most widely used visa for non-immigrant scientists, engineers, technical personnel • 6-year maximum term • May be renewed • U.S. Government agencies involved in assessment • US Citizenship & Immigration Services (USCIS) within U.S. Department of Homeland Security • U.S. Department of Labor • U.S. Department of State at consulates around world • Job must require a bachelor’s degree or equivalent as a minimum for entry into field of employment • Employee must have required degree(s) or equivalent and any required licenses • Job must relate directly to academic degree(s) held #ACIITAR H-1B WAGE REQUIREMENTS • Employer must pay “prevailing” or “actual” wage, whichever is higher • Prevailing wage: average wage paid to similar workers in same geographical area • Actual wage: actual wage paid by particular employer to similar employee, if any • Employer must also offer same employment benefits to H-1B employee as to U.S. workers • Health, dental, life insurance • Holidays • Maternity/paternity benefits • Eligibility for bonus plans #ACIITAR AVAILABILITY OF H-1B VISAS • 65,000 “new” H-1B visas each fiscal year under current law • First 20,000 applications with U.S. master’s or Ph.D. degree exempt from 65,000 cap, so, effectively 85,000 visa/year • Average applications (2001-11): 311,889/year • Each fiscal year is October 1 - September 30 • File by April 1 for October 1 start date (if subject to cap) • Next new H-1B availability: October 1, 2014 • Currently exempt employers/employees from caps: • Colleges and universities or “affiliated” organizations • Non-profit research institutions • Government research institutions • Already in H-1B visa status with a different U.S. employer #ACIITAR TN VISA OVERVIEW • Professionals who are eligible under North American Free Trade Agreement (NAFTA) • Certain qualified Canadian, Mexican citizens for temporary work in U.S. in a professional field • No quota and always available • Initial term of up to 3 years • Easier, faster processing than H-1B, L-1 or E visas • Job must be temporary in nature, so a TN visa may be difficult to extend with same employer • Could potentially roll into H-1B visa if longer term needed #ACIITAR TN VISA REQUIREMENTS • Limited only to qualified Canadian or Mexican citizens • Has a profession listed in USCIS regulations (accountant, physician, engineer, etc.) • Note: NOT ALL NORMAL PROFESSIONS ARE INCLUDED • Has a job offer from a U.S. company/organization in that profession • Application process: • Canadian: May apply directly to US-Canada border office without need to apply for a visa or file a petition with USCIS. Instant adjudication. • Mexican: Must obtain a TN visa at a U.S. embassy/consulate in Mexico or elsewhere first but no need to file a petition with USCIS • Application documents: (1) Canadian/Mexican passport; (2) offer letter from U.S. employer detailing prospective employment; and (3) copy of college diploma, licenses and job experience letters (if relevant) #ACIITAR U.S. EXPORT CONTROL LAWS & FOREIGN PERSONS #ACIITAR “U.S. PERSON” & “FOREIGN PERSON” • “U.S. person” as defined in ITAR § 120.15: • [U.S. citizen] (not expressly stated but implied) • U.S. lawful permanent resident (so-called “green card” holder) • Person in the United States who is bona fide refugee or asylum seeker • Organization (e.g., corporation, partnership, trust, etc.) formed under