As of June 11, 2010, United States Citizenship & Immigration Services (“USCIS”) has receipted 27,778 H-2B petitions, towards the 47,000 beneficiaries target for the second half of the fiscal year. This count includes 26,303 approved and 1,475 pending petitions. Beneficiaries target is the estimated number of petitions needed to reach the cap; it will always be higher than the actual cap.

The H-2B non-agricultural temporary worker program allows U.S. employers to bring foreign nationals to the United States to fill temporary non-agricultural jobs. There is a statutory numerical limit, or “cap,” on the total number aliens who may be issued a visa or otherwise provided H-2B status (including through a change of status) during a fiscal year.

Currently, the H-2B cap set by Congress is 66,000 per fiscal year, with 33,000 to be allocated for employment beginning in the 1st half of the fiscal year (October 1 – March 31) and 33,000 to be allocated for employment beginning in the 2nd half of the fiscal year (April 1 – September 30). Any unused numbers from the first half of the fiscal year will be made available for use by employers seeking to hire H-2B workers during the second half of the fiscal year. There is no “carry over” of unused H-2B numbers from one fiscal year to the next.

Generally, an H-2B worker who extends his/her stay in H-2B status will not be counted again against the H-2B cap. Similarly, the spouse and children of H-2B workers classified as H-4 nonimmigrants are not counted against this cap. Additionally petitions for the following types of workers are exempt the H-2B cap:

1. Fish roe processors, fish roe technicians and/or supervisors of fish roe processing
2. From November 28, 2009 until December 31, 2014, workers performing labor or services in the
Commonwealth of Northern Mariana Islands (“CNMI”) and/or Guam.

Once the H-2B cap is reached, USCIS may only accept petitions for H-2B workers who are exempt from the H-2B cap.

The following guest blog is provided courtesy of Paul L. Schnier. Mr. Schnier is Chairman of Blaney McMurtry’s tax group, which provides a wide range of services to business clients, This includes acting for Canadian and foreign lenders and borrowers to help structure their transactions in a tax effective manner.

Governments across the world are searching in these early post-recession days for measures that will continue to help create a new era of sustainable economic vigour and the business and personal prosperity that go with it. It seems clear from the March 4 federal budget that part of the Government of Canada’s plan is to promote more foreign direct investment in this country.

Foreign direct investment plays a crucial role in Canadian business. Not only does it provide a significant portion of the capital for economic growth, but it brings in new management expertise, technology and value-added jobs.

At the end of 2007, according to Statistics Canada, foreign direct investment constituted a $501 billion share of a national economic engine that generated $1.2 trillion in goods and services, more than double the $219 billion stake that international investors had held a decade earlier.

This growth seems destined to continue and perhaps even accelerate as Canada’s historic social and political stability and its watchful approach to banking regulation continue to help the country stand out in bold relief as a safe haven for international investment.

And in addition to those strengths, we now have a new budget that proposes a number of significant tax changes, one of which will reduce taxes collected but should lead to a substantial increase in the venture capital investment that foreigners are prepared to make in Canada.

Until now, non-residents have had to deal with a complex withholding and reporting regime when disposing of their Canadian investments. The Budget loosens these requirements significantly.

Under current legislation, when a non-resident disposes of taxable Canadian property to a Canadian resident, he must first obtain a clearance certificate from the Canada Revenue Agency. This is done through a filing with the CRA and often involves paying an amount or posting security with respect to any applicable taxes, or satisfying the CRA that no tax is payable.

Unless the purchaser receives this clearance certificate, he is obliged to withhold 25 per cent of the purchase price from the sale proceeds on account of the vendor’s potential tax liability. One can easily see the distress that would be caused where, for example: the clearance certificate is not produced in time for closing or where the purchase price is not paid in cash.

“Taxable Canadian Property” has, until now, included Canadian real property and items akin to real property, such as resource properties and timber limits. It has also included shares of private companies as well as shares of public companies where 25 per cent or more of any class of shares of the public company are held by one or more members of a family group.

The Budget proposes to amend this definition so that the foregoing types of shares will only constitute taxable Canadian property where they derive more than 50 per cent of their value principally from Canadian real estate, resource properties or timber limits held by the company at any time in the 60 month period preceding the date of sale.

In other words, shares of private companies or shares of a closely held public company will be subject to the old withholding and reporting regime only where the companies are, or have been, involved in the real estate, resource or forestry sectors. This allows for a wide array of companies, such as those in the high tech, manufacturing, and retail sectors (which are intensive in technology and value-added employment), to attract foreign investment without the concern that any gains realized on these investments will be subject to Canadian tax.

Also, it is important to note that this proposal applies to investments by any non-resident. Formerly, certain investors who were resident in a country with which Canada had a tax treaty would have enjoyed some relief from this taxation. The change applies equally to both residents of a treaty jurisdiction, such as the United States or Japan, as well as those resident in jurisdictions with which Canada does not have a tax treaty, such as Hong Kong.

This means everyone is now on a level playing field and there is no reason to engage in complicated investment structures utilizing treaty jurisdictions. This amendment should open up Canadian investment to all comers and thus further enhance our global competitiveness as a place to invest.

The change will also affect distributions to non-residents from Canadian trusts and estates. The clearance certificate requirement will no longer apply to such distributions unless the property distributed meets the new definition. This will ease the administrative burden on trustees and beneficiaries alike.

In a parallel move, the Budget also proposes to make it easier for non-residents to obtain refunds where more funds than necessary have been withheld by a purchaser under the clearance certificate procedure. Both proposals are important moves in the right direction to attract greater international investment to Canada.

Today, Citizenship, Immigration and Multiculturalism Minister Jason Kenney introduced legislation that would streamline the citizenship revocation process, crack down on crooked citizenship consultants and better protect the value of Canadian citizenship.

“Canadian citizenship is highly valued around the world and today we are taking steps to ensure it stays that way,” said Minister Kenney. “These changes will help prevent citizenship fraud. As promised in the Speech from the Throne, these amendments will streamline the process to take citizenship away from those who have acquired it by fraud, including by concealment of their war crimes. And it would take decision-making away from politicians and give it to the courts.”

The full package of amendments would strengthen the process of applying for citizenship and crack down on citizenship fraud. Bill C-37: Strengthening the Value of Canadian Citizenship Act proposes to:

• Add legal authority to regulate citizenship consultants and to crack down where they help people gain citizenship fraudulently, in line with the recently proposed amendments to the Immigration and Refugee Protection Act – The Cracking Down on Crooked Consultants Act – aimed at immigration consultants.
• Increase the penalties for citizenship fraud to a maximum of $100,000 or up to five years in prison or both.
• Strengthen citizenship residence requirements to specify in the law that people applying for citizenship would have to be physically present in Canada for three of the previous four years. [Note: Citizenship and Immigration Canada ("CIC") has applied this physical presence requirement for some time, despite the fact that the current Immigration and Refugee Protection Act does not clearly define “residence” for the purposes of citizenship eligibility. A number of federal court cases have found that residence does not necessarily equate to physical presence but CIC has previously chosen to ignore them. This amendment appears to be the Canadian Federal Government’s attempt to supercede this line of cases.]
• Improve the government’s ability to bar criminals, including violent foreign criminals, from becoming Canadian citizens.
• Streamline the revocation and removal process and make revocation more transparent by shifting the decision making on revocations from the Governor in Council to the Federal Court.
• Ensure that the law supports the implementation of the first generation limit to passing on citizenship, ensure that the law does not unintentionally bar applicants who are eligible for citizenship, and ensure that the children of people serving Canada aboard – children of Crown servants – are not disadvantaged by their parent’s service to Canada and are able to pass on citizenship to their children.

“Canadian citizenship is more than a legal status, more than a passport,” said Minister Kenney. “We expect citizens to have an ongoing commitment, connection and loyalty to Canada.”

On June 7, 2010, Department of Homeland Security (“DHS”) Secretary Janet Napolitano announced that 100 percent of passengers traveling within the United States and its territories are now being checked against terrorist watchlists through the Transportation Security Administration’s (“TSA”) Secure Flight program—a major step in fulfilling a key 9/11 Commission recommendation.

Before Secure Flight, airlines conducted passenger watchlist checking.
“Secure Flight fulfills a key recommendation of the of the 9/11 Commission Report, enabling TSA to screen passengers directly against government watchlists using passenger name, date of birth, and gender before a boarding pass is issued,” said Secretary Napolitano. “This program is one of our many layers of security—coordinated with our partners in the airline industry and governments around the world—that we leverage to protect the traveling public against threats of terrorism.”

Under Secure Flight, TSA prescreens passenger name, date of birth and gender against government watchlists for domestic and international flights. In addition to facilitating secure travel for all passengers, the program helps prevent the misidentification of passengers who have names similar to individuals on government watchlists.

“We are quite pleased to see the positive outcome from the collaborative work that the Air Transport Association (“ATA”), its member airlines and TSA have invested in the development of the Secure Flight program,” said ATA President and CEO James C. May. “We are especially pleased that TSA phased program implementation to ensure that commercial airline travelers experience a seamless transition.”

99 percent of passengers will be cleared by Secure Flight to print boarding passes at home by providing their date of birth, gender and name as it appears on the government ID they plan to use when traveling when booking airline tickets. Individuals found to match watchlist parameters will be subjected to secondary screening, a law enforcement interview or prohibition from boarding an aircraft, depending on the specific case.

The Transportation Security Administration began implementing Secure Flight in late 2009 and expects all international carriers with direct flights to the U.S. to begin using Secure Flight by the end of 2010.

On June 9, 2010, the U.S. Department of State announced its new policy guidelines regarding gender change in passports and Consular Reports of Birth Abroad. Beginning June 10, when a passport applicant presents a certification from an attending medical physician that the applicant has undergone appropriate clinical treatment for gender transition, the passport will reflect the new gender.

The guidelines include detailed information about what information the certification must include. It is also possible to obtain a limited-validity passport if the physician’s statement shows the applicant is in the process of gender transition.

No additional medical records are required. Sexual reassignment surgery is no longer a prerequisite for passport issuance. A Consular Report of Birth Abroad can also be amended with the new gender.

As with all passport applicants, passport issuing officers at embassies and consulates abroad and domestic passport agencies and centers will only ask appropriate questions to obtain information necessary to determine citizenship and identity.

The new policy and procedures are based on standards and recommendations of the World Professional Association for Transgender Health (WPATH), recognized by the American Medical Association as the authority in this field.

There is broad consensus among economists that immigration has a small but positive impact on the average income of Americans over the long term. But far less analysis has been done on the impact of immigrants on the labor market in the shorter term, particularly when viewed through the lens of the recession and its lingering labor market effects.

In a new Migration Policy Institute report, The Impact of Immigrants in Recession and Economic Expansion, University of California, Davis economist Giovanni Peri finds that immigration unambiguously improves employment, productivity and income but that it also involves some short-term adjustments (such as worker retraining or adoption of new technology). It was commissioned to inform the work of MPI’s Labor Markets Initiative, which is conducting a comprehensive, policy-focused review of the role of legal and illegal immigration in the labor market.

The report, which examines short- and long-run impacts of immigration on average and over the business cycle of growth and contraction, finds that:

• Immigrants do not reduce native employment rates over the long run (10 years), while increasing productivity and average income for native-born workers. Immigration to the United States over the 1990-2006 period can be credited with a 2.9 percent increase in real wages for the average U.S. worker.
• The adjustment process, however, is not immediate. When immigration occurs during a downturn, the economy does not appear to respond as quickly as it would during economic expansions and there is evidence of modest negative impacts on employment and average income in the short run. These impacts dissipate over periods of up to seven years.
• During periods of economic growth, by contrast, new immigration creates jobs in sufficient numbers to leave native employment unharmed even in the short run. This holds true even for less-educated workers. Immigration during economic expansions has no measurable, short-term negative effect on income per worker.

“Adjustments to employment, productivity and income are more difficult during downturns,” Peri said. “This suggests that the United States would benefit most from an immigration system that better adjusts to economic conditions, allowing legal immigrant inflows to be more responsive to the economic cycle.”

In the report, Peri suggests allowing employers’ demand for work visas to play a stronger role in determining the number of visas issued annually, and that a share of the visas be allocated to less-skilled workers, particularly those who perform primarily manual jobs that native workers increasingly are much less interested in filling.

“This report offers further evidence yet of the need for the immigration system to become significantly more responsive to the U.S. economy’s constantly evolving labor market needs, so that the benefits of immigration can be captured more fully and any negative effects neutralized,” said MPI President Demetrios Papademetriou. “Establishing an independent executive-branch agency that would make regular recommendations to the president and Congress for adjusting employment-based immigration levels would inject a greatly needed degree of flexibility into the current rigid immigration system.”

MPI first articulated the concept for a Standing Commission on Labor Markets, Economic Competitiveness, and Immigration in 2006, and further fleshed out the proposal in a 2009 report, Harnessing the Advantages of Immigration for a 21st-Century Economy: A Standing Commission on Labor Markets, Economic Competitiveness, and Immigration.

The Peri report is available at www.migrationpolicy.org/pubs/Peri-June2010.pdf.

United States Citizenship and Immigration Services (“USCIS”) has announced that it has revised the Employment Authorization Document (“EAD”), or Form I-766, to incorporate the addition of a machine-readable zone on the back of the card. This update to the EAD is part of USCIS’s ongoing efforts to deter immigration fraud.

Starting May 11, USCIS began issuing the revised EAD cards. The machine-readable zone is compliant with International Civil Aviation Organization standards. USCIS also removed the two-dimensional bar code on the backside of the card and moved the informational box of text to just beneath the magnetic stripe on the card. The revised card retains all of its existing security features.

The front of the EAD card remains the same:

The back of the EAD card definitely looks different. The smaller image to the left is the old design and the larger image to the right is the new design:

According to United States Citizenship and Immigration Services (“USCIS”), as of May 21, 2010, approximately 19,600 H-1B cap-subject petitions were receipted. Additionally, USCIS has receipted 8,200 H-1B petitions for aliens with advanced degrees.

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 current annual cap on the H-1B category is 65,000. However, some petitions are exempt from the cap under the advanced degree exemption provided to the first 20,000 petitions filed for a beneficiary who has obtained a U.S. master’s degree or higher. Others are completely exempt from the numerical limits.

Please note that up to 6,800 H-1B numbers may be set aside from the cap of 65,000 during each fiscal year for the H-1B1 program under the terms of the legislation implementing the U.S.-Chile and U.S.-Singapore Free Trade Agreements. Unused numbers in this pool are made available for H-1B use for the next fiscal year.

Today, United States Customs & Border Protection (“USCBP”) announced that the first-year anniversary of the Western Hemisphere Travel Initiative (“WHTI”) at all land and sea ports of entry occurred on June 1, 2009. WHTI was intended to enhance border security and facilitate lawful cross-border travel between the U.S. and Canada and Mexico.

“WHTI is the first fully implemented 9/11 Commission border recommendation designed to enhance security while affording facilitation to legitimate border crossers through the use of technology,” said USCBP Commissioner Alan Bersin. “We have already seen a number of cases where new document requirements have led to significant positive results at increasing security at ports of entry.”‪

WHTI is the joint Department of State-Department of Homeland Security plan that implemented a key 9/11 Commission recommendation to establish document requirements for travelers entering the U.S. who were previously exempt, including citizens of the U.S., Canada and Bermuda. It requires U.S. and Canadian citizens, age 16 and older, to present a valid, acceptable travel document that denotes both identity and citizenship when entering the U.S. by land or sea.

According to USCBP, its preliminary analyses indicate that the implementation has had no negative impact on wait times at the land border ports of entry and the national compliance rate has been steady at 95 percent. USCBP also claims that WHTI has had a positive impact on specific apprehensions. False claims to U.S. citizenship apprehensions rose 25 percent on the southern border following WHTI implementation on June 1, 2009. The rate of fraudulent documents intercepted at the land border increased by 12 percent compared to the rate in 2008.

Under WHTI, radio frequency identification (“RFID”) technology and license plate readers were deployed, on-time and on-budget, to the top 39 high-volume land ports of entry covering approximately 95 percent of land border traffic. These facilitative technologies are playing an integral role in improving efficiencies.

RFID technology facilitates travel across the land border by allowing traveler information to be pre-positioned for the CBP officer as a vehicle approaches primary inspection. Processing travelers with RFID documents is 60 percent faster than processing documents that are not RFID-enabled.

More than five million WHTI-compliant, RFID-enabled documents have been issued. USCBP continues to strongly encourage travelers to obtain RFID-enabled travel document to expedite their entry and to help make the borders more efficient.

The WHTI RFID technology and license plate readers have also been installed at U.S. Border Patrol checkpoints and will soon be installed at CBP outbound operations sites.

As of May 28, 2010, United States Citizenship & Immigration Services (“USCIS”) has receipted 26,737 H-2B petitions, towards the 47,000 beneficiaries target for the second half of the fiscal year. This count includes 25,570 approved and 1,167 pending petitions. Beneficiaries target is the estimated number of petitions needed to reach the cap; it will always be higher than the actual cap.

The H-2B non-agricultural temporary worker program allows U.S. employers to bring foreign nationals to the United States to fill temporary non-agricultural jobs. There is a statutory numerical limit, or “cap,” on the total number aliens who may be issued a visa or otherwise provided H-2B status (including through a change of status) during a fiscal year.

Currently, the H-2B cap set by Congress is 66,000 per fiscal year, with 33,000 to be allocated for employment beginning in the 1st half of the fiscal year (October 1 – March 31) and 33,000 to be allocated for employment beginning in the 2nd half of the fiscal year (April 1 – September 30). Any unused numbers from the first half of the fiscal year will be made available for use by employers seeking to hire H-2B workers during the second half of the fiscal year. There is no “carry over” of unused H-2B numbers from one fiscal year to the next.

Generally, an H-2B worker who extends his/her stay in H-2B status will not be counted again against the H-2B cap. Similarly, the spouse and children of H-2B workers classified as H-4 nonimmigrants are not counted against this cap. Additionally petitions for the following types of workers are exempt the H-2B cap:

1. Fish roe processors, fish roe technicians and/or supervisors of fish roe processing
2. From November 28, 2009 until December 31, 2014, workers performing labor or services in the
   Commonwealth of Northern Mariana Islands (CNMI) and/or Guam.

Once the H-2B cap is reached, USCIS may only accept petitions for H-2B workers who are exempt from the H-2B cap.