[Federal Register Volume 76, Number 42 (Thursday, March 3, 2011)]
[Proposed Rules]
[Pages 11686-11699]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-4731]


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DEPARTMENT OF HOMELAND SECURITY

8 CFR Parts 214 and 299

[CIS No. 2443-08; DHS Docket No. USCIS-2008-0014]
RIN 1615-AB71


Registration Requirement for Petitioners Seeking to File H-1B 
Petitions on Behalf of Aliens Subject to the Numerical Limitations

AGENCY: U.S. Citizenship and Immigration Services, DHS.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Department of Homeland Security is proposing to amend its 
regulations governing petitions filed on behalf of H-1B alien workers 
subject to annual numerical limitations or exempt from numerical 
limitations by virtue of having earned a U.S. master's or higher degree 
(also referred to as the ``65,000 cap'' and ``20,000 cap'' 
respectively, or the ``cap'' collectively). This rule proposes to 
require employers seeking to petition for H-1B workers subject to the 
cap to first file electronic registrations with U.S. Citizenship and 
Immigration Services (USCIS) during a designated registration period. 
Under this proposed rule, if USCIS anticipates that the H-1B cap will 
not be reached by the first day that H-1B petitions may be filed for a 
particular fiscal year, USCIS would notify all registered employers 
that they are eligible to file H-1B petitions on behalf of the 
beneficiaries named in the selected registrations. USCIS would continue 
to accept and select registrations until the H-1B cap is reached. On 
the other hand, if USCIS anticipates that the H-1B cap will be reached 
by the first day that H-1B petitions may be filed for a particular 
fiscal year, USCIS would close the registration before such date and 
randomly select a sufficient number of timely filed registrations to 
meet the applicable cap. USCIS proposes to allow only those petitioners 
whose registrations are randomly selected to file H-1B petitions for 
the cap-subject prospective worker named in the registration. USCIS 
would create a waitlist containing some or all of the remaining 
registrations, based on USCIS statistical estimates of how many more 
registrations may be needed to fill the caps should the initial pool of 
selected registrations fall short. USCIS would notify the employers of 
those registrations placed on the waitlist when and if they are 
eligible to file an H-1B petition. Employers whose registrations were 
neither randomly selected to file petitions nor placed on the waitlist 
would receive notification that they were not selected to file 
petitions in that fiscal year.
    USCIS anticipates that this new process will reduce administrative 
burdens and associated costs on employers who currently must spend 
significant time and resources compiling the petition and supporting 
documentation for each potential beneficiary without certainty that the 
statutory cap has not been reached. The proposed mandatory registration 
process also will alleviate administrative burdens on USCIS service 
centers that process H-1B petitions.

DATES: Written comments must be submitted on or before May 2, 2011.

ADDRESSES: You may submit comments, identified by DHS Docket No. USCIS-
2008-0014 by one of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail: You may submit comments directly to USCIS by e-
mail at rfs.regs@dhs.gov. Include DHS Docket No. USCIS-2008-0014 in the 
subject line of the message.
     Mail: Chief, Regulatory Products Division, U.S. 
Citizenship and Immigration Services, Department of Homeland Security, 
20 Massachusetts Avenue, NW., Washington, DC 20529-2020. To ensure 
proper handling, please reference DHS Docket No. USCIS-2008-0014 on 
your correspondence. This mailing address may also be used for paper, 
disk, or CD-ROM submissions.
     Hand Delivery/Courier: U.S. Citizenship and Immigration 
Services, Department of Homeland Security, 20 Massachusetts Avenue, 
NW., Washington, DC 20529-2020. Contact Telephone Number is (202) 272-
8377.

FOR FURTHER INFORMATION CONTACT: Shelly Sweeney, Adjudications Officer, 
Business Employment Services Team, Service Center Operations 
Directorate, U.S. Citizenship and Immigration Services, Department of 
Homeland Security, 20 Massachusetts Avenue, NW., 2nd Floor, Washington, 
DC 20529-2060, telephone (202) 272-8410.

SUPPLEMENTARY INFORMATION: This supplementary information section is 
organized as follows:

I. Public Participation
II. Background
    A. Current H-1B Petition Process
    B. H-1B Nonimmigrants Subject to H-1B Caps
    C. Current Random Selection Process
    D. Fiscal Year 2009 Filings
III. Proposed Registration Program

[[Page 11687]]

    A. Registration
    1. Announcement of Registration Requirement
    2. Information Required
    3. USCIS Acceptance of Registrations
    B. Random Selection of Registrations
    C. H-1B Petition Filing Period After Random Selection
IV. Miscellaneous Amendments
V. Regulatory Requirements
    A. Regulatory Flexibility Act
    B. Unfunded Mandates Reform Act of 1995
    C. Small Business Regulatory Enforcement Fairness Act of 1996
    D. Executive Order 12866 (Regulatory Planning and Review)
    E. Executive Order 13132 (Federalism)
    F. Executive Order 12988 (Civil Justice Reform)
    G. Paperwork Reduction Act

I. Public Participation

    Interested persons are invited to participate in this rulemaking by 
submitting written data, views, or arguments on all aspects of this 
proposed rule. The Department of Homeland Security (DHS) and U.S. 
Citizenship and Immigration Services (USCIS) also invite comments that 
relate to the economic, environmental, or federalism effects that might 
result from this proposed rule. Comments that will provide the most 
assistance to DHS and USCIS will reference a specific portion of the 
proposed rule, explain the reason for any recommended change, and 
include data, information, or authority that support such recommended 
change.
    Instructions: All submissions received must include the agency name 
and DHS Docket No. USCIS-2008-0014. All comments received will be 
posted without change to http://www.regulations.gov, including any 
personal information provided.
    Docket: For access to the docket to read background documents or 
comments received go to http://www.regulations.gov. Submitted comments 
may also be inspected at the Regulatory Products Division, U.S. 
Citizenship and Immigration Services, Department of Homeland Security, 
20 Massachusetts Avenue, NW., Washington, DC 20529-2020.

II. Background

    Congress has established limits on the number of alien workers who 
may be granted H-1B nonimmigrant visas or status each fiscal year 
(commonly known as the ``cap''). See Immigration and Nationality Act 
(INA) section 214(g), 8 U.S.C. 1184(g). With a few exceptions, the 
total number of aliens who may be accorded H-1B nonimmigrant status 
during any fiscal year currently may not exceed 65,000. See INA sec. 
214(g), 8 U.S.C. 1184(g). The ability of employers to fill available 
U.S. jobs with aliens otherwise eligible for the H-1B nonimmigrant 
classification generally depends on when the employers filed petitions 
for such workers and the number of such petitions that USCIS has 
approved to allow workers to begin employment during the course of the 
fiscal year (i.e., October 1 through September 30). USCIS, however, may 
only accord H-1B status in the order in which it receives the H-1B 
petitions. See INA sec. 214(g)(3), 8 U.S.C. 1184(g)(3).
    USCIS monitors the requests for H-1B workers and administers the 
distribution of available H-1B cap numbers in light of these limits. 
The first day on which petitioners may file H-1B petitions can be as 
early as six months ahead of the projected employment start date. See 8 
CFR 214.2(h)(9)(i)(B). During years of high demand for H-1B workers, 
the H-1B cap has been reached within days of the opening of the H-1B 
filing period for a new fiscal year. In practical terms, this means 
that the cap has been reached on or shortly after April 1 (which is six 
months before the start of a new fiscal year). For example, in FY 2009, 
USCIS received nearly 163,000 H-1B petitions between April 1 and April 
7, 2008. See e.g. USCIS Update, ``USCIS Releases Preliminary Number of 
H-1B Cap Filings,'' http://www.uscis.gov/files/article/USCIS%20Update_H1B_Preliminary%20Count1_10Apr08.pdf.
    To ensure the fair and orderly distribution of H-1B cap numbers, 
USCIS employs a random selection process after announcing a final date 
on which it will receive H-1B petitions. USCIS refers to this day as 
the ``final receipt date.'' See 8 CFR 214.2(h)(8)(ii)(B). In past 
fiscal years, the final receipt date has been as early as the first day 
after USCIS began accepting H-1B petitions for the new fiscal year. In 
Fiscal Year 2010, due to the struggling economy and high unemployment 
rates, the final receipt date was not reached until December 21, 2009. 
Petitions submitted properly on the ``final receipt date'' undergo a 
random selection process to determine which petitions can be processed 
to completion and, if otherwise eligible, which beneficiaries are able 
to receive a new H-1B visa number.
    USCIS has found that when it receives a significant number of H-1B 
petitions (e.g., 100,000 or more) within the first few days of the H-1B 
filing period, it is difficult to handle the volume of petitions 
received in advance of the H-1B random selection process. Further, 
after expending USCIS resources to ensure proper processing of these 
petitions, USCIS must reject and return to the petitioning employer 
those petitions and associated fees that are not randomly selected as 
eligible for an H-1B cap number. U.S. employers are also adversely 
affected by the current petition process. Preparing and mailing H-1B 
petitions, with the required filing fee, can be burdensome and costly 
for employers, if the petition must ultimately be returned because the 
cap was reached and the petition was not selected in the random 
selection process.
    Requiring U.S. employers to file complete H-1B petitions prior to 
the random selection process is not the most efficient way to 
administer the allocation of available H-1B cap numbers. USCIS is 
proposing an alternate, more streamlined mechanism for allocating H-1B 
cap numbers and administering the H-1B cap.

A. Current H-1B Petition Process

    Before employing an H-1B temporary worker, a U.S. employer must 
first obtain a certification from the U.S. Department of Labor (DOL) 
confirming that it has filed a Labor Condition Application (LCA) in the 
occupational specialty in which the alien will be employed. See 8 CFR 
214.2(h)(4)(i)(B)(1) and 8 CFR 214.2(h)(1)(ii)(B)(3). Upon 
certification of the LCA, the employer may then file an H-1B petition 
with USCIS on Form I-129, Petition for a Nonimmigrant Worker. Once 
USCIS accepts a properly filed H-1B petition, it adjudicates the 
petition. USCIS will notify the petitioner in writing if it requires 
additional information before rendering a written decision to approve 
or deny the petition. See 8 CFR 103.2(a)(8) and 214.2(h)(9) and (10). 
An approved H-1B petition is valid for a period of up to three years 
and may not exceed the validity period of the LCA. See 8 CFR 
214.2(h)(9)(iii)(A)(1).
    Prior to the expiration of the initial H-1B status, the petitioning 
employer may apply for an extension of stay, or a different employer 
may petition on behalf of the temporary worker. See 8 CFR 
214.2(h)(2)(i)(D), (h)(15)(ii)(B). An extension of stay generally may 
only be granted for a period of up to three years, such that the total 
period of the H-1B temporary worker's admission does not exceed six 
years. See INA 214(g)(4), 8 U.S.C. 1184(g)(4); 8 CFR 
214.2(h)(15)(ii)(B)(1). As with initial H-1B petitions, the petitioning 
employer must first obtain a certified LCA from DOL before applying for 
the extension of stay. At the end of the six-year

[[Page 11688]]

period,\1\ in most cases, the alien must change to another nonimmigrant 
status, seek permanent resident status, or depart the United States. 
The alien may be eligible for a new six-year maximum period of stay in 
H-1B nonimmigrant status if he or she remains outside the United States 
for at least one year. See 8 CFR 214.2(h)(13)(iii)(A).
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    \1\ Certain aliens are exempt from the six-year maximum period 
of admission under sections 104(c) and 106(a) and (b) of the 
American Competitiveness in the Twenty-First Century Act of 2000 
(AC21), Public Law 106-313, 114 Stat. 1251 (Oct. 17, 2000).
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B. H-1B Nonimmigrants Subject to H-1B Caps

    Most aliens seeking a new H-1B nonimmigrant classification are 
subject to a numerical cap of 65,000 visas each fiscal year. Exempt 
from this 65,000 cap are aliens who: (1) Are employed at, or have 
received an offer of employment from, an institution of higher 
education, or a related or affiliated nonprofit entity; (2) are 
employed at, or have received an offer of employment from, a nonprofit 
research organization or a governmental research organization; or (3) 
have earned a master's or higher degree from a U.S. institution of 
higher education. INA sec. 214(g)(5), 8 U.S.C. 1184(g)(5). The 
exemption for aliens who have attained a U.S. master's degree or higher 
is capped at 20,000 H-1B petitions per fiscal year (``20,000 cap''). 
See INA sec. 214(g)(5)(C), 8 U.S.C. 1184(g)(5)(C).
    The spouses and children of H-1B nonimmigrants, classified as H-4 
nonimmigrants, do not count toward the 65,000 and 20,000 caps. See INA 
sec. 214(g)(2), 8 U.S.C. 1184(g)(2); 8 CFR 214.2(h)(8)(ii)(A). In 
addition, USCIS does not apply the 65,000 and 20,000 caps in the 
following cases:
     Requests for H-1B petition extensions;
     Requests for extensions of stay in the United States; and
     Petitions filed on behalf of aliens who are currently in 
H-1B nonimmigrant status but seek to change the terms of current 
employment, change employers,\2\ or work concurrently under a second H-
1B petition.
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    \2\ If the alien was previously employed by a cap-exempt 
petitioner and thus never counted against the cap, the worker must 
be counted against the cap when switching to an employer that is 
subject to the cap. See INA sec. 214(g)(6), 8 U.S.C. 1184(g)(6).
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    These aliens have already been counted towards either the 65,000 or 
20,000 cap in previous years. See INA sec. 214(g)(7), 8 U.S.C. 
1184(g)(7); 8 CFR 214.2(h)(8)(ii)(A).

C. Current Random Selection Process

    To manage the 65,000 and 20,000 caps, USCIS monitors the number of 
H-1B petitions it receives at each service center. The first day on 
which petitioners may file H-1B petitions can be as early as six months 
ahead of the projected employment start date. See 8 CFR 
214.2(h)(9)(i)(B). For example, a U.S. employer seeking an H-1B worker 
for a job beginning October 1 (the first day of the next fiscal year) 
can file an H-1B petition no earlier than April 1 of the current fiscal 
year. Thus, an H-1B employer requesting a worker for the first day of 
FY 2012, October 1, 2011, would be allowed to file an H-1B petition on 
April 1, 2011. When USCIS determines, based on the number of H-1B 
petitions it has received for a cap season, that the 65,000 or 20,000 
cap will be reached, it announces to the public the final day on which 
H-1B petitions can be filed for that cap season.
    USCIS then randomly selects the number of petitions needed to reach 
the H-1B cap. The random selection process includes all petitions 
received on the final receipt date. USCIS makes projections on the 
number of petitions necessary to achieve the numerical limit of 
approvals, taking into account historical data related to approvals, 
denials, revocations, and other relevant factors. See 8 CFR 
214.2(h)(8)(ii)(B). USCIS then randomly selects approximately 15-20% 
over the regular cap number of 65,000 and approximately 5-10% over the 
master's degree cap number of 20,000.
    If USCIS receives sufficient H-1B petitions to reach the 65,000 and 
20,000 caps for the upcoming fiscal year within the first five business 
days, USCIS randomly selects from all H-1B petitions filed within the 
first five business days, beginning first with H-1B petitions subject 
to the 20,000 cap. Id. Once the random selection process for the 20,000 
cap is complete, USCIS conducts the random selection process for the 
65,000 cap. Once the random selection process for the 65,000 cap is 
complete, USCIS rejects all remaining H-1B petitions, including those 
not selected during one of the random selections. USCIS also rejects 
all H-1B petitions received after the final receipt date. See 8 CFR 
214.2(h)(8)(ii)(D).

D. Current Allocation Process

    This proposed rule is designed to alleviate many of the 
difficulties and inefficiencies stemming from the current H-1B 
allocation process and to simplify the allocation of available H-1B cap 
numbers. The registration requirement also will aid USCIS in the 
administrative front-end processing of cap-subject H-1B petitions.
    For example, during the first five business days of filing for FY 
2009, USCIS received approximately 163,000 H-1B petitions, well in 
excess of the available H-1B cap numbers. Some of the front-end 
processing activities associated with handling this exceptionally high 
volume of receipts include, but are not limited to, opening and sorting 
mail, identifying properly filed petitions, placing petitions through 
the random selection process, notifying petitioners of selected 
petitions, receipting fees and entering data for selected petitions, 
and returning all of the nonselected and improperly filed petitions 
with associated fees.
    Since USCIS first created the random selection process in 2005, it 
has twice received significant numbers of H-1B petitions that exceeded 
the 65,000 and 20,000 caps on April 1, the first day the petitions 
could be filed for a new fiscal year. Petitioning employers rushed to 
file H-1B petitions for FY 2008, because in the previous fiscal year, 
USCIS reached the H-1B cap on the second filing day. See USCIS Update, 
``USCIS Updates Count of FY 2008 H-1B Cap Filings,'' http://www.uscis.gov/files/pressrelease/H1Bfy08CapUpdate041007.pdf. Many 
petitioning employers apparently anticipated a similar shortage of H-1B 
cap numbers for FY 2009 and, as a result, hurried to file the petitions 
to ensure USCIS received them at the start of the filing period. In an 
effort to relieve some of the burdens associated with handling the huge 
volumes of petitions received on the first filing day, USCIS amended 
the regulations pertaining to the random selection process on March 24, 
2008. See 73 FR 15389.
    Although the current regulations at 8 CFR 214.2(h)(8)(ii)(B) 
provide some relief by authorizing USCIS to include in the random 
selection process all petitions filed during the first five business 
days, USCIS proposes to take further measures to alleviate 
administrative burdens and the current uncertainty faced by petitioners 
who must prepare and submit H-1B petitions for all potential 
beneficiaries. Petitioning employers often expend significant time and 
resources to prepare the H-1B petition for submission. These resources 
and costs are expended for every potential H-1B worker the employer 
wants to hire, regardless of whether the petition will ultimately be 
adjudicated by USCIS.

III. Proposed

[[Page 11689]]

H-1B Registration Program

    USCIS proposes to establish a mandatory Internet-based electronic 
registration process for U.S. employers seeking to file H-1B petitions 
for alien workers subject to either the 65,000 or 20,000 caps. See 
proposed 8 CFR 214.2(h)(8)(ii). The electronic registration process 
would be in advance of the start of the period during which actual 
petitions can be filed for a new fiscal year (i.e., immediately prior 
to April 1). This process would require U.S. employers to register for 
consideration of available H-1B cap numbers in advance of having to 
file and receive a certified LCA from the DOL.
    This rule also proposes to establish processes for selecting 
registrations. Upon notification of selection by USCIS, a registrant 
would proceed to submit the LCA to DOL for certification and prepare 
the corresponding H-1B petition on behalf of the desired beneficiary. 
USCIS would reject any H-1B petition filing that is not based on a 
selected registration. The proposed registration requirement, which 
would take approximately 30 minutes to complete, is preferable for 
petitioners because selected registrations would have a higher 
probability of receiving an H-1B slot before petitioners would be 
required to expend the time and expenses necessary to complete H-1B 
petitions.
    The proposed registration process would greatly improve the 
agency's ability to manage the H-1B cap and reduce the burden on 
petitioning employers in terms of up-front form preparation and filing 
fee submission. Below is a more detailed discussion of the proposed 
registration process and petition filing procedures for H-1B petitions 
subject to registration.

A. Registration

1. Announcement of the Registration Period
    USCIS proposes to establish a mandatory Internet-based electronic 
registration process for U.S. employers seeking to file H-1B petitions 
for alien workers subject to either the 65,000 or 20,000 cap. See 
proposed 8 CFR 214.2(h)(8)(ii)(B)(1). The entire Internet registration 
process would commence each year in advance of the filing period for 
actual petitions.
    The proposed rule would clarify USCIS's discretionary authority to 
temporarily suspend the H-1B registration process for any given fiscal 
year or to permanently terminate the registration process. USCIS would 
notify the public of any program suspension or termination via an 
update on the USCIS public Web site. Proposed 8 CFR 
214.2(h)(8)(ii)(A)(3). The public frequently turns to the USCIS Web 
site for information and uses the USCIS Web site for general 
information on immigration benefits rules and processes, statutes and 
regulations, downloadable immigration forms, specific case status 
information, and processing times at the various service centers and 
district offices. Some members of the public sign up for e-mail alerts 
that provide the latest information posted on the USCIS Web site 
regarding particular applications, petitions, or visa classifications. 
Because of the wide use of the USCIS Web site by the public, the 
posting of information on the dates of suspension or termination of the 
registration process on the USCIS Web site would provide a timelier and 
more efficient method of disseminating such information to the public 
than publication of the information in the Federal Register. For 
example, USCIS may need to suspend or terminate the availability of the 
registration process in the event that Congress greatly increases the 
annual number of H-1B visas that USCIS may allocate each fiscal year. 
This rule would afford USCIS the flexibility to adapt quickly when 
various contingencies arise while providing the public with adequate 
notice of any impact on the registration availability.
    Under the proposed registration process, each petitioning employer 
would be required to file registrations electronically through the 
USCIS Web site (http://www.uscis.gov) in accordance with the 
instructions provided. See proposed 214.2(h)(8)(ii)(B)(1). USCIS 
proposes to establish a registration period that would begin no later 
than in the month of March each year, for a minimum period of two 
weeks. USCIS would notify the public of the respective start and end 
dates for the registration period via the USCIS Web site (http://www.uscis.gov). See proposed 8 CFR 214.2(h)(8)(ii)(A)(2). All 
registrations would be required to be filed during the timeframes 
announced by USCIS on its public Web site. USCIS would not accept any 
registrations filed either before or after the close of the specified 
registration period. USCIS invites the public to comment on whether the 
proposed start of the registration period would be sufficient time for 
prospective petitioners to submit their registrations.
    Note that each annual registration period would be treated as 
separate from any earlier registration period. Therefore, employers 
from a previous registration period would not be automatically entered 
into a new registration period.
2. Information Required
    This rule proposes that registrations must include basic 
information regarding the company and beneficiary: (1) The employer's 
name, employer identification number (EIN), and employer's mailing 
address; (2) the authorized representative's name, job title, and 
contact information (telephone number and e-mail address); (3) the 
beneficiary's full name, date of birth, country of birth, country of 
citizenship, gender and passport number; and (4) any additional 
information requested by the registration or USCIS. Proposed 8 CFR 
214.2(h)(8)(ii)(B). USCIS seeks public comments on the type of 
information requested and whether the list should be expanded or in any 
way changed for U.S. employers.
    USCIS has determined that the content noted above is the minimum 
information that USCIS will need to identify the prospective H-1B 
petitioner and specific named beneficiary, to eliminate duplicate 
registrations, and to match approved and selected registrations with 
subsequently filed H-1B petitions.
3. USCIS Acceptance of Registrations
    USCIS proposes to require U.S. employers who choose to participate 
in the registration process to file a single registration for each 
prospective H-1B temporary worker they seek to hire. Multiple 
beneficiaries cannot be listed on a single registration. In addition, 
petitioners may not file multiple registrations for the same H-1B 
beneficiary. USCIS recognizes that, because this would be a new system, 
petitioners or their preparers may accidentally or unintentionally 
submit more than one registration on behalf of a single beneficiary. 
Therefore, this rule proposes that if USCIS receives more than one 
registration for a single H-1B beneficiary by the same petitioner, 
USCIS will accept the first valid registration and reject any 
subsequent duplicate requests.
    Each U.S. employer who submits a properly completed H-1B Cap 
Registration request online will receive electronically an automatic 
notification that the registration request has been accepted by USCIS 
(note, acceptance is not the same as selection). The notification will 
be in a printable format and contain a unique identifying number for 
USCIS tracking and recordkeeping purposes. Registering employers can 
retain a hard copy of the acceptance notification for their files.

[[Page 11690]]

USCIS also proposes to assign a unique identifying number for each 
registration, which would be included on the electronic notification of 
registration acceptance.

B. Selection of Registrations

1. If the Number of Registrations Is Less Than the 65,000 or 20,000 Cap 
by April 1
    In the event that the number of registrations is less than the 
number of available cap numbers before the first day that H-1B petition 
filings may be made (e.g., April 1), USCIS would announce on its Web 
site that the registration period will remain open until such time as 
USCIS determines it has enough registrations to reach the cap. If the 
number of registrations received during the initial registration period 
is less than what is needed to reach the cap, all registrations 
accepted during that initial period would be selected. At such time 
USCIS believes it has enough registrations to meet the cap, it will 
announce the closing of the registration period on the USCIS Web site 
and will conduct a random selection of all registrations received on 
the last day of the registration period (i.e., ``final receipt date''). 
U.S. employers who receive notification that their registrations have 
been selected will be eligible to file an H-1B petition on behalf of 
the prospective H-1B worker named in the selected registration in 
accordance with the normal filing rules.
    While the rule proposes to permit USCIS to keep the registration 
period open in the event that registrations remain low during the 
fiscal year, this rule would provide USCIS with the authority to close 
the registration period before the close of the fiscal year to allow 
petitioners sufficient time to complete and file their petitions and 
USCIS sufficient time to receive and process petitions. See proposed 8 
CFR 214.2(h)(8)(ii)(A)(3).
2. If the Number of Registrations Is More Than the 65,000 or 20,000 Cap
    In the event that USCIS would receive significantly more 
registrations than the H-1B cap, USCIS would conduct a random selection 
of the registrations timely received in a number sufficient to meet the 
65,000 and 20,000 caps. Under such random selection process, USCIS 
would randomly select approximately 15-20% over the regular cap number 
of 65,000 and approximately 5-10% over the master's cap number of 
20,000. The reason for selecting a percentage of registrations over the 
cap numbers of 65,000 and 20,000 is based on historical approval, 
denial and rejection rates, and in order to account for a variety of 
factors, such as: Randomly selected registrants that ultimately decide 
not to file an H-1B petition; H-1B petitions that are rejected as 
improperly filed or that are denied based on ineligibility; petitions 
that are later found revocable; and beneficiaries who ultimately decide 
not to seek an H-1B visa or are found ineligible for a visa. The random 
selection process will be conducted via a method approved by the Office 
of Immigration Statistics and will be similar to the current random, 
computer-generated selection process for H-1B petitions outlined at 8 
CFR 214.2(h)(8)(ii)(B).
    After the random selection process is complete, USCIS would be 
authorized to create a waitlist of remaining registrations. The 
waitlist of remaining registrations would be based on USCIS statistical 
estimates of how many more registrations may be needed to fill the caps 
should the pool of selected registrants unexpectedly fall short of 
reaching the caps. Waitlisted registrations would be randomly sorted 
and given a unique number in sequential order. USCIS would notify 
employers that their registrations have been placed on the waitlist. As 
H-1B numbers become available, waitlisted registrations would be 
selected so that employers can file H-1B petitions in accordance with 
the normal filing rules.
    Employers with registrations that are neither randomly selected to 
file nor placed on the waitlist would receive notification that their 
registrations were not selected and that they are ineligible to file a 
petition for the applicable fiscal year.

C. Filing of H-1B Petition Following Selection

1. Eligibility To File
    USCIS proposes to accept only cap-subject H-1B petitions based on 
selected registrations, and only for the H-1B beneficiary named in the 
original registration; others will be rejected. See proposed 8 CFR 
214.2(h)(8)(ii)(D). No substitution of beneficiaries would be 
permitted. USCIS recognizes that employer needs often change and 
potential workers may become unavailable for a variety of reasons. 
However, USCIS is proposing to limit the filing of petitions to the 
beneficiary named on the original registration request in an effort to 
guard against the possibility of abuse from the minority of employers 
who might otherwise attempt to monopolize petition filing ``slots'' and 
create an illegitimate secondary market for H-1B beneficiaries. 
Furthermore, an employer is prohibited from filing more than one H-1B 
petition in the same fiscal year on behalf of the same alien if the 
alien is subject to the cap or is exempt from the cap because of having 
earned a master's degree or higher from a U.S. institution of higher 
education. However, if an H-1B petition is denied, on a basis other 
than fraud or misrepresentation, the employer may file a subsequent H-
1B petition on behalf of the same alien in the same fiscal year, 
provided that the numerical limitation has not been reached or if the 
filing qualifies as exempt from the numerical limitation. See 8 CFR 
214.2(h)(2)(i)(G).
2. Availability of Cap Numbers
    Under the proposed registration and selection process, if an H-1B 
petition is otherwise approvable, a petitioner likely would be assured, 
but would not be guaranteed, the availability of an H-1B cap number 
under the 65,000 or 20,000 cap, whichever is applicable. USCIS notes 
that, while it takes every conceivable measure to accurately reach and 
not exceed the cap, and while the registration system is specifically 
designed to substantially increase the public's assurance that numbers 
are available for selected registrants, USCIS cannot guarantee every 
petitioner that an H-1B number will be available for the beneficiary at 
the time of filing their petition. As USCIS may accept more 
registrations than the prescribed statutory limit for H-1B petitions 
(to account for the variety of factors previously referenced, such as 
drop-outs or unapprovable petitions), there still exists a possibility 
that the applicable cap may be reached prior to the date that a 
selected registrant has filed a petition. This is especially true if, 
for example, a selected registrant does not file its petition until 
well after the filing period for petitions has begun (April 1st).
    Once actual petition filings commence on April 1st of each fiscal 
year, USCIS monitors petition receipts closely to ensure adherence to 
the numerical caps. As explained, petitions filed with USCIS are 
adjudicated in the order they are received and USCIS cannot approve any 
petition that would cause it knowingly to exceed the statutory caps. 
However, the over-selection of registrations is necessary due to 
factors such as selected registrants who do not file Form I-129; 
petitions that are rejected, denied or withdrawn; approved petitions 
that are later revoked; and multiple petitions filed for the same 
individual. By over-selecting registrations, there is a risk of 
exceeding the statutory caps. Therefore,

[[Page 11691]]

the challenge is getting close to the numerical cap without exceeding 
it. In order to stay within the numerical limits of the cap, only 
85,000 registrations (65,000 plus 20,000) would have to be selected 
from the lottery. However, by selecting only 85,000 registrations, 
USCIS will likely be under the numerical cap for the reasons stated 
above. Thus, there is a tradeoff between cap compliance certainty 
(being under 85,001) and cap utilization risk (getting close to the 
numerical cap). Nevertheless, the actual number of H-1B petition 
approvals is generally not known until the end of the fiscal year as a 
result of petitions being revoked, denied or withdrawn throughout the 
year. Although it is possible to exceed the numerical cap during the 
fiscal year in December or January, the actual number of petitions 
approved usually falls under the numerical cap by August or September 
as a result of ongoing revocations.
3. Filing Time Period
    USCIS proposes that petitioners would have not less than 60 days 
from the date of notification of selection (``selection notice'') to 
properly file a completed H-1B petition for the named beneficiary. 
USCIS would state the applicable filing deadline in each selection 
notice. Proposed 8 CFR 214.2(h)(8)(ii)(D)(2). Allowing USCIS to specify 
the filing period in the selection notice would give USCIS the 
flexibility to provide filing periods of longer than 60 days if 
necessary to accommodate processing backlogs.
    If the H-1B petition is filed after the filing window closes, USCIS 
would reject the H-1B petition. In other words, a selected registrant 
who does not take advantage of the eligibility to file a petition on 
behalf of the named beneficiary within the timeframe stated on the 
selection notice would forego eligibility to file and, consequently, 
any consideration for an available cap number based on that selection 
notice.
    USCIS is proposing to set a minimum 60-day filing window to ensure 
that the petitioner has adequate time to prepare the H-1B petition 
package, and, at the same time, that USCIS has adequate time to 
determine if a sufficient number of petitions have been filed to reach 
the H-1B annual numerical limitation. The proposed minimum 60-day 
filing window also would provide USCIS with a minimum time period 
within which it would be able to determine the number of selected 
registrants who actually filed a petition and whose petition was 
approved by USCIS. Calculating the H-1B approval rate during the 60-day 
filing period would allow USCIS to assess whether there is a need to 
resort to selecting registrations from the waitlisted pool of 
registrants, thereby allowing more registrants in the queue to file 
petitions to reach the cap.
    The proposed minimum 60-day filing period in which a selected 
registrant may opt to file a petition on behalf of the named 
beneficiary would be read consistently with the existing regulation 
providing that a petitioner may file no earlier than six months before 
the date of actual need for the beneficiary's services or training. 8 
CFR 214.2 (h)(9)(i)(B). In other words, while the proposed minimum 60-
day filing window would provide a cutoff date for filing a petition, 
selected registrants would still be able to file a petition up to six 
months prior to the date of stated need. If, for example, an employer's 
selection notice dated March 31, 2010 contains a 60-day filing period, 
and the requested start date is October 1, 2010, the petition must be 
filed no later than May 30, 2010 or USCIS will reject the petition. 
Another example is if an employer receives the selection notice dated 
May 1, 2010 with a 60-day filing period, then the petition must be 
filed no later than June 30, 2010. If the H-1B petition is filed on 
June 30, 2010, the requested start date may be no later than December 
30, 2010, which is six months after the filing date.
4. Submission of Selection Notice With H-1B Petition
    The rule also proposes to require that selected registrants submit 
the selection notice with the actual H-1B petition at the time of 
filing. See proposed 8 CFR 214.2(h)(8)(ii)(D)(2). The submission of the 
selection notice is an anti-fraud measure to ensure the integrity of 
the H-1B cap number allocation system. Further, each selection notice 
will contain a unique identifying number and have a machine-readable 
zone that USCIS can use to verify the petitioner and intended 
beneficiary. Submission of the selection notice facilitates the proper 
and timely identification of petitioners and beneficiaries selected 
during the registration process. Failure to submit the selection notice 
will result in the rejection of the H-1B petition and the return of the 
filing fees.

IV. Miscellaneous Amendments

    This proposed rule also includes modifications to the current H-1B 
cap management provisions at 8 CFR 214.2(h)(8)(ii)(B). The proposed 
amendments do not alter the current H-1B cap management process but 
instead clarify the provision so it better reflects how USCIS conducts 
the H-1B random selection process. The current cap management process 
is modified by running the random lottery on the registrations rather 
than the actual filed petition. The proposed system will not require 
the petitions to be returned as the lottery will be done prior to 
filing the actual petitions. This proposed rule also adds a cross 
reference to the registration process. See proposed 8 CFR 
214.2(h)(8)(ii)(B).

V. Regulatory Requirements

A. Unfunded Mandates Reform Act of 1995

    This rule will not result in the expenditure by State, local and 
Tribal governments, in the aggregate, or by the private sector, of $100 
million or more in any one year, and it will not significantly or 
uniquely affect small governments. Therefore, no actions were deemed 
necessary under the provisions of the Unfunded Mandates Reform Act of 
1995.

B. Small Business Regulatory Enforcement Fairness Act of 1996

    This rule is not a major rule as defined by section 804 of the 
Small Business Regulatory Enforcement Act of 1996. This rule will not 
result in an annual effect on the economy of $100 million or more; a 
major increase in costs or prices; or significant adverse effects on 
competition, employment, investment, productivity, innovation, or on 
the ability of United States-based companies to compete with foreign-
based companies in domestic and export markets.

C. Executive Order 12866

    This rule has been designated as significant under Executive Order 
12866. Thus, under the Executive Order, USCIS has prepared an 
assessment of the benefits and costs anticipated to occur as a result 
of this rule and made it available for review in the rulemaking docket 
for this rule at http://www.regulations.gov. The costs and benefits of 
this rule are summarized as follows.
1. Summary
    We estimate the total net savings to USCIS and H-1B petitioners 
from this rule is $23,611,393 at a three percent discount rate and 
$19,150,459 at a seven percent discount rate over the next ten years.
    Over the next 10 years, this rule will result in a savings to those 
businesses that file H-1B petitions of $35,826,852 based on a discount 
rate of three percent, and $29,499,043 based on a discount rate of 
seven percent. However, the costs imposed on H-1B petitioners as a 
result of this rule over

[[Page 11692]]

the next 10 years will be $11,942,284 at the three percent discount 
rate, and $9,833,014 discounted at seven percent. Thus the net savings 
resulting from this rule for H-1B petitioners over the next 10 years 
will be $23,884,568 at three percent and $19,666,029 at seven percent.
    In the next 10 years, this rule will result in USCIS saving 
approximately $3,520,244 when discounted at three percent, and 
$2,898,492 when discounted at seven percent. The total USCIS costs over 
the next 10 years as a result of the changes proposed in this rule will 
be $3,793,419 discounted at three percent and $3,414,062 at the seven 
percent discount rate. The net cost to USCIS over the 10 years 
following this rule, discounted at three percent, is $273,175, and 
discounted at seven percent the costs will be $515,570.
    The impacts of this rule on employers wanting to hire an H-1B 
worker and the government are summarized in the following table.
---------------------------------------------------------------------------

    \3\ Rounded to nearest thousand, except for average.
    \4\ The H-1B filing cap was 195,000 in fiscal years 2002 and 
2003. In FY 2005, USCIS exceeded the 65,000 cap--see full report at 
http://www.dhs.gov/xoig/assets/mgmtrpts/OIG_05-49_Sep05.pdf http://www.dhs.gov/xoig/assets/mgmtrpts/OIG_05-49_Sep05.pdf.
    \5\ As of 18 December 2009. Additionally, since the 65,000 cap 
was not met for FY 2010, excess approved petitions for the Master's 
exemption were rolled into the 65,000 cap.
    \6\ A small percentage above the 65,000 or 20,000 are processed 
based on historic denial rates in order to ensure that all 85,000 
spots are used by those selected.
    \7\ Percentage based on number of filings; rounded.
    \8\ These years are the dates when the current cap numbers were 
in effect and thus appropriate for comparison.
    \9\ FY 2006 was the first year the 20,000 Master's exemption 
(authorized by the 2004 H-1B Visa Reform Act) became operational.
    \10\ As of 18 December 2009. See additional information in 
footnote five.

------------------------------------------------------------------------
                                   Net present value   Net present value
      10-Year cost category        at 3 percent per    at 7 percent per
                                         annum               annum
------------------------------------------------------------------------
H-1B filer savings..............          35,826,852          29,499,043
H-1B filer cost.................          11,942,284           9,833,014
Net H-1B filer savings..........          23,884,568          19,666,029
Government savings..............           3,520,244           2,898,492
Government costs................           3,793,419           3,414,062
Net Government cost.............             273,175             515,570
Total Estimated net savings to           $23,611,393         $19,150,459
 the government and H-1B filers.
------------------------------------------------------------------------

2. Recent Petition Filing Volume \3\

65,000 cap.\4\

----------------------------------------------------------------------------------------------------------------
           Fiscal year               2010 \5\          2009            2008            2007            2006
----------------------------------------------------------------------------------------------------------------
Filings.........................          68,000         133,000         120,000          67,000          74,000
Accepted \6\....................          65,000          74,000          71,000          67,000          74,000
Approved........................          48,000          60,000          64,000          65,000          63,000
Percent approved \7\............             71%             45%             53%             97%             85%
----------------------------------------------------------------------------------------------------------------


----------------------------------------------------------------------------------------------------------------
                                                                                                  9-year average
           Fiscal year                 2005            2004            2003            2002             \8\
----------------------------------------------------------------------------------------------------------------
Filings.........................          81,000          73,000          88,000          89,000          88,000
Accepted........................          79,000          71,000          86,000          87,000          75,000
Approved........................          72,000          65,000          78,000          79,000          66,000
Percent approved................             89%             89%             89%             89%             75%
----------------------------------------------------------------------------------------------------------------

20,000 Master's exemption.\9\

--------------------------------------------------------------------------------------------------------------------------------------------------------
                       Fiscal year                           2010 \10\         2009            2008            2007            2006       5 year average
--------------------------------------------------------------------------------------------------------------------------------------------------------
Filings.................................................          28,000          30,000          21,000          21,000          21,000          24,000
Accepted................................................          27,000          23,000          21,000          21,000          21,000          23,000
Approved................................................          23,000          19,000          19,000          20,000          20,000          20,000
Percent approved........................................             82%             63%             90%             95%             95%             83%
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 11693]]

3. Problems Being Addressed--Overwhelmed by Paper Petitions
    The statutory numerical limits on H-1B visas have created 
complications for both employers and DHS. On the first two filing days 
for fiscal year 2008, April 2 and 3, 2007, USCIS received 123,000 H-1B 
petitions subject to the 65,000 cap or 20,000 Master's cap exemption. 
This was the first time since the random selection process was 
instituted that USCIS received more petitions than available cap 
numbers on the first two days. USCIS randomly selected 71,000 from 
those received on April 2 and April 3 for processing to fill the 65,000 
cap and rejected 52,000 others.\11\ In 2007, petitions for the 20,000 
U.S. master's degree or higher visas for 2008 were rejected after 
filings reached approximately 21,000. In 2008 (for fiscal year 2009 
workers), approximately 163,000 total petitions were received during 
the five day filing period. Of those, USCIS accepted 74,000 and 23,000 
to process for both cap categories, and rejected 66,000. In 2008, the 
20,000 master's degree exempt visas were filled by the final receipt 
date for the first time. USCIS believes that the master's degree cap 
exemption numbers will continue to be utilized by employers as quickly 
as the non-master's allotment. For that reason, it is proposed that 
they be made subject to registration under this rule.
---------------------------------------------------------------------------

    \11\ Petition returned and fee refunded.
---------------------------------------------------------------------------

    In the filing periods to request H-1B workers for fiscal years 2008 
and 2009, an average of 59,000 petitions per year were completed and 
mailed, usually by overnight carrier, along with fee payments, without 
even being accepted by USCIS for processing. Meanwhile, the USCIS 
service centers involved in the petitioning process were overwhelmed in 
those years by the quantity of paper petitions received in early April 
until the receipt date was closed. Much time and effort was spent to 
open the packages, process the mail, receipt the petition for 
processing, check the fee payments, and perform the associated tasks. 
Readying all submissions for the random selection process requires work 
by many employees. For fiscal years 2008 and 2009, multiple truckloads 
of petitions were stacked on pallets on loading docks, in offices, and 
in hallways. Then only around 60 percent of those submitted were 
processed. The logistical problems caused by the huge volume of filings 
result in effort wasted on petitions that cannot be processed in those 
years when the demand for H-1B visas greatly exceeds the available 
supply.
4. Changes Proposed--Registration
    This rule proposes to require employers to register in a system for 
either the master's exemption or regular cap categories regardless of 
the anticipated employment start date. Once the registration period is 
over, 65,000 and 20,000 H-1B registrants, as applicable, will be 
randomly selected and invited to file an H-1B petition. This rule 
proposes that entries for the program must be submitted electronically 
through the USCIS Web site in a time frame as established on the USCIS 
Web site.
5. Benefits
    No Unnecessary Petitions. The main benefit that will result from 
this rule is that employers that want to hire an H-1B worker will be 
able to forgo the time, effort, and expense associated with the 
preparation of a full H-1B petition, the Department of Labor (DOL) 
Labor Condition Application, and all of the necessary supporting 
documentation unless USCIS notifies the H-1B employer that space exists 
under the cap.\12\
---------------------------------------------------------------------------

    \12\ DOL Form ETA 9035E, Labor Condition Application (LCA). The 
INA directs the Secretary of Labor to certify that there are not 
sufficient workers who are able, willing, qualified and available 
and that the employment of an alien will not adversely affect the 
wages and working conditions of workers in the United States 
similarly employed. The regulations of the Department of Labor 
delineate the specific rules to be followed for each program that 
requires labor certification from the Secretary of Labor. 20 CFR 
part 655. http://www.foreignlaborcert.doleta.gov/.
---------------------------------------------------------------------------

    This rule would result in savings for the typical H-1B employer 
from not incurring the expense of preparing an H-1B petition when cap 
space is not available. In an analysis of recent H-1B filings, USCIS 
records showed that 93 percent of H-1B petitions were accompanied by a 
USCIS Form G-28, Notice of Entry of Appearance as Attorney or 
Accredited Representative, indicating that the petitioner is 
represented. Thus, most H-1B filers pay an attorney to prepare and 
submit their Forms I-129. To the extent that such expenses are avoided 
by registering under this rule, these avoided costs represent a benefit 
to society.
    The public reporting burden for Form I-129 that has been approved 
by OMB under the Paperwork Reduction Act is 2.75 hours per petition, 
including the time for reviewing instructions, completing, and 
submitting the form. As previously discussed, a majority of H-1B filers 
use an attorney to assist with the preparation of the I-129. For the 
purpose of this analysis, we will assume that the 2.75 hour burden 
associated with completing the I-129 is split between an attorney and a 
staff member equivalent to a human resource manager. According to the 
Bureau of Labor Statistics, the average hourly salary for a lawyer and 
human resource manager are, respectively, $59.98 and $49.96.\13\ For 
the compensation costs required for this analysis, we used the average 
of those two wage rates, $54.97, and multiplied it by 1.43 to account 
for the full cost of employee benefits such as paid leave, insurance, 
retirement, etc.\14\ Thus the cost to prepare an H-1B petition is 
approximately $78.61 per hour, and the total cost to complete a Form I-
129 is $216.18 ($78.61 x 2.75). This cost estimate is conservative 
because many employers actually employ more costly outside counsel 
rather than ``in-house'' attorneys and managers to complete H-1B 
petitions.
---------------------------------------------------------------------------

    \13\ See United States Department of Labor, Bureau of Labor 
Statistics, Occupational Employment Statistics, May 2008 National 
Occupational Employment and Wage Estimates at http://www.bls.gov/oes/2008/may/oes_nat.htm#b11-0000.
    \14\ U.S. Department of Labor, Bureau of Labor Statistics, 
Economic News Release, Table 1. Employer costs per hour worked for 
employee compensation and costs as a percent of total compensation: 
Civilian workers, by major occupational and industry group, March 
2009, viewed online at http://www.bls.gov/news.release/ecec.t01.htm.
---------------------------------------------------------------------------

    By requiring a petitioner to register in order to be eligible to 
file, filing volume would be capped at around 91,000 petitions.\15\ To 
illustrate the maximum possible savings that could result from this 
rule, if the same number of filings that were received for FY 2009 
workers occurs again in the future, filings would exceed those accepted 
by 72,000.\16\ This would result in a possible opportunity cost savings 
for unnecessary petition preparation of nearly $15.6 million in any 
year in which such a large number of filings are received. (72,000 x 
$216.18). There have been years, however, such as fiscal year 2007, 
where the number of petitions received did not exceed the number that 
could be processed under the cap. Taking account of this variation, 
once this proposed rule is in place, it is expected to reduce paper 
petition filing volumes by about 19,000 per year.\17\ This would

[[Page 11694]]

result in average petitioner preparation burden savings of $4.1 million 
per year.\18\ Thus, based on past fiscal years' filing volume, the 
paperwork burden savings resulting from this rule would range from zero 
to $15.6 million, with average cost savings of $4.1 million per year 
based on future volume projections.
---------------------------------------------------------------------------

    \15\ 70,000 + 21,000 (estimated petitions that would need to be 
accepted, based on historic denial rates, in order to achieve the 
65,000 cap and the 20,000 master's exemption cap).
    \16\ 163,000 - 91,000.
    \17\ The average volume in the previous nine years for H-1B visa 
petitions subject to the 65,000 cap was 89,000. Since its inception 
in 2006, average filing volume for the 20,000 master's exemption H-
1B visas totaled 23,000, resulting in a combined average of 112,000 
filings annually. Based on these past results, recent upward trends 
in filings, and expected demand for H-1B visas in the future, USCIS 
projects that about 110,000 H-1B petitions would be filed per year 
in future years.
    \18\ 19,000 x $216.18 = $4,107,420.
---------------------------------------------------------------------------

    Reduced Mailing Expenses. While not required by regulations, in 
order to ensure receipt of a petition by USCIS, H-1B petitioners 
typically mail their petitions via overnight couriers. As indicated in 
the Small Business Impacts section below, USCIS estimates that the 
average sponsoring employer files three H-1B petitions, and each 
employer would, logically, mail all of its petitions in one package. 
Estimating the average mailing cost at $17.50 per mailed package,\19\ 
this rule would result in cost savings for petitioning employers 
ranging from zero to $420,000, with a projected annual cost savings of 
about $111,000 per year.\20\
---------------------------------------------------------------------------

    \19\ United States Postal Service, Express Mail Flat Rate 
Envelope, see http://www.usps.com/prices/express-mail-prices.htm.
    \20\ USCIS projects future petition filing volume of 
approximately 110,000 H-1B petitions annually, exceeding the 91,000 
to be accepted for processing by around 19,000. Savings in largest 
volume year = 72,000/3 x $17.50 = $420,000. Savings in typical year 
of 110,000 projected filings = 19,000/3 x $17.50 = $110,833.
---------------------------------------------------------------------------

    The 10-year savings to H-1B filers, discounted at three and seven 
percent, is summarized in the following table.

----------------------------------------------------------------------------------------------------------------
                                                                                   Yearly            Yearly
                           Year                               Total yearly       discounted        discounted
                                                              savings \21\       savings  3%       savings  7%
----------------------------------------------------------------------------------------------------------------
1.........................................................         4,200,000         4,077,670         3,925,234
2.........................................................         4,200,000         3,958,903         3,668,443
3.........................................................         4,200,000         3,843,595         3,428,451
4.........................................................         4,200,000         3,731,646         3,204,160
5.........................................................         4,200,000         3,622,957         2,994,542
6.........................................................         4,200,000         3,517,434         2,798,637
7.........................................................         4,200,000         3,414,984         2,615,549
8.........................................................         4,200,000         3,315,519         2,444,438
9.........................................................         4,200,000         3,218,950         2,284,522
10........................................................         4,200,000         3,125,194         2,135,067
                                                           -----------------------------------------------------
                                                            Total Discounted       $35,826,852       $29,499,043
                                                                     Savings
----------------------------------------------------------------------------------------------------------------

     
---------------------------------------------------------------------------

    \21\ $4.1 million preparation savings plus $111,000 mailing 
savings.
---------------------------------------------------------------------------

    Government Benefits. This rule would significantly ease the 
administrative burden on USCIS of managing the random selection 
lottery. When petitions filed significantly exceed those that can be 
approved, USCIS expends funds collected for other application types to 
open the mail and handle H-1B petition filings that do not result in 
any fee collections. Over the most recent three fiscal years, USCIS 
received an average of almost 133,000 petitions, accepted 93,000, and 
approved an average of approximately 78,000. This means that 55,000 
more were received than were approved, and 40,000 more than were 
adjudicated. In addition, for fiscal years 2008 and 2009, about 10,700 
petitions were filed for premium processing, all of which had to be 
acted on within 15 days of the day of the random selection.
    This surge diverts resources away from normal duties to receive, 
unload, stack, and open the mail, verify that the mail contains H-1B 
petitions, perform minimal data entry, and place a bar-code on each 
petition for use in the random selection at a later date--all efforts 
estimated at 40 minutes for each petition.\22\ Further time was spent 
over the following two-week period to complete the initial selection; 
enter chosen petitions into the tracking system; and return rejected 
petitions. The typical contract clerk that performs these steps earns 
on average $23.58 for regular time hours.\23\ Therefore, this piece of 
the H-1B processing procedure needlessly costs USCIS about $298,680 
each year.\24\
---------------------------------------------------------------------------

    \22\ 60/40 = 1.5 petitions received/guarded/sorted/stacked/
opened/entered/notified per hour.
    \23\ Per USCIS Service Center Operations--fully burdened average 
rate for CA and VT.
    \24\ (19,000/1.5 petitions per hour) x $23.58 per hour average 
regular time = $298,680 annual regular time savings.
---------------------------------------------------------------------------

    Additional costs were also incurred to shift 18,000 Form I-130 
filings to California from Vermont, so Vermont could concentrate on the 
cap cases received. In such high demand and volume years, electronic 
registration would decrease the random selection preparation time, 
preclude the processing of most fee refunds, and reduce overtime costs 
and lost production. USCIS can better utilize this time, effort, and 
other resources to adjudicate other benefits.
    Many savings associated with this rule are difficult to quantify; 
however, we are able to estimate mailing costs for returning unaccepted 
petitions. We estimate mailing costs for rejected H-1B filings at $6.00 
per mailed package.\25\ USCIS individually returns unaccepted petitions 
to petitioners. Again, using forecast approximations, we can calculate 
shipping savings at $114,000 annually.\26\ Combining savings data 
generates a typical total annual savings for USCIS of about $412,680.
---------------------------------------------------------------------------

    \25\ http://postcalc.usps.gov/Summary.aspx?m=2&p=1&o=0&dz=20529&oz=90210&MailingDate=1/4/2010&MailingTime=7:09%20AM&time=2%20days&mt=11&es=106.
    \26\ 19,000 excess petitions x $6.00 per package mailing costs = 
$114,000 shipping savings per year.
---------------------------------------------------------------------------

    Registration would also add a qualitative benefit for future filers 
by averting a front log for H-1B petitions and allowing more efficient 
notification of the petitioners as to whether they will receive a cap 
number. Petitioners would be able to more efficiently plan employment 
and staffing levels, and would know whether or not an H-1B visa holder 
would be an option for a position vacancy.
    The 10-year savings to USCIS, discounted at three and seven 
percent, is summarized in the following table.

[[Page 11695]]



----------------------------------------------------------------------------------------------------------------
                                                                                   Yearly            Yearly
                           Year                               Total yearly       discounted        discounted
                                                                 savings        savings-  3%      savings-  7%
----------------------------------------------------------------------------------------------------------------
1.........................................................          $412,680          $400,660          $385,682
2.........................................................           412,680           388,990           360,451
3.........................................................           412,680           377,661           336,870
4.........................................................           412,680           366,661           314,832
5.........................................................           412,680           355,981           294,235
6.........................................................           412,680           345,613           274,986
7.........................................................           412,680           335,547           256,996
8.........................................................           412,680           325,773           240,184
9.........................................................           412,680           316,285           224,471
10........................................................           412,680           307,073           209,786
                                                           -----------------------------------------------------
                                                            Total Discounted         3,520,244         2,898,492
                                                                     Savings
----------------------------------------------------------------------------------------------------------------

6. Costs
    Government Implementation Costs. As part of this rule, USCIS is 
developing an Internet-based system for registration. Initial 
development is estimated to cost $800,000, including system design, 
creation of all required supporting documentation, hardware deployment, 
and testing the system. Initial hardware and equipment costs are 
estimated to be approximately $1,400,000. In addition, USCIS estimates 
that initial personnel costs to establish the system would require 
$150,000 to fund two positions.\27\ Total first year cost would be 
$2,350,000. Continuing costs would be $200,000 per year--$150,000 for 
the two support personnel per year and maintenance charges of about 
$50,000 per year to maintain the system.
---------------------------------------------------------------------------

    \27\ Includes total compensation costs and benefits.
---------------------------------------------------------------------------

    The cost to the government over the next 10 years, discounted at 
three and seven percent, is summarized in the following table.

----------------------------------------------------------------------------------------------------------------
                                    First year      Continuing     Total yearly     Discounted      Discounted
              Year                     cost            cost            cost          cost  3%        cost  7%
----------------------------------------------------------------------------------------------------------------
1...............................      $2,350,000              $0      $2,350,000      $2,281,553      $2,196,262
2...............................               0         200,000         200,000         188,519         174,688
3...............................               0         200,000         200,000         183,028         163,260
4...............................               0         200,000         200,000         177,697         152,579
5...............................               0         200,000         200,000         172,522         142,597
6...............................               0         200,000         200,000         167,497         133,268
7...............................               0         200,000         200,000         162,618         124,550
8...............................               0         200,000         200,000         157,882         116,402
9...............................               0         200,000         200,000         153,283         108,787
10..............................               0         200,000         200,000         148,819         101,670
                                 -------------------------------------------------------------------------------
                                  ..............  ..............           Total       3,793,419       3,414,062
                                                                  Discounted 10-
                                                                            year
                                                                      Government
                                                                            Cost
----------------------------------------------------------------------------------------------------------------

    Registration. USCIS estimates that the public reporting burden for 
H-1B Cap Registration using the electronic system will average 30 
minutes per response, including the time for reviewing instructions, 
completing, and submitting. Petitioners must file a separate 
registration for each requested beneficiary and each beneficiary must 
be named. After the closing date, DHS will run a random selection 
process and notify the lottery winners. Upon selection in the lottery 
system, a petitioner will be invited to submit a Form I-129 for 
adjudication of an H-1B visa.
    While most employers hire an attorney to prepare Form I-129 for 
prospective H-1B employees, registrations are straightforward and 
should require minimal skills, rather than those of an attorney or 
management-level employee. The hourly cost for an employer would be the 
compensation costs for the time required for a petitioning firm's 
employee to complete the registration. USCIS has reviewed the Bureau of 
Labor Statistics' Occupational Classifications and believes that the 
job definition for a Human Resource Assistant indicates that a Human 
Resource Assistant should possess the skills necessary to provide the 
registration information, as the duties for that position includes 
compiling information and furnishing information to authorized persons. 
The average hourly salary for a Human Resource Assistant is $17.70.\28\ 
Using a multiplier of 1.43 to account for the cost of benefits, the 
costs per hour to prepare an H-1B petition is $25.31. Thus, the

[[Page 11696]]

paperwork burden of each registration would cost about $12.66.\29\ 
USCIS understands that some businesses may not have an employee with 
the title of ``Human Resource Assistant.'' We believe that a fully 
loaded wage of $25.31 per hour is a reasonable proxy for the wage of 
the employee that would be required to submit the basic information 
being requested by the registration.
---------------------------------------------------------------------------

    \28\ According to BLS, the duties for Human Resource Assistant 
are to compile and keep personnel records, record data for each 
employee (such as address, weekly earnings, absences, amount of 
sales or production, supervisory reports on ability, and date of and 
reason for termination), compile and type reports from employment 
records, file employment records, search employee files, and furnish 
information to authorized persons. USCIS believes H-1B Registration 
will require a similar level of skill as these tasks. See http://www.bls.gov/oco/ocos150.htm. Average wage for 2008 is at: http://www.bls.gov/oes/2008/may/oes_nat.htm#b11-0000.
    \29\ 60/30 = 0.5 hours x $25.31= $12.66.
---------------------------------------------------------------------------

    For the purposes of this analysis, we assume that a sufficient 
number of petitions would be received each year to approve the 85,000 
maximum workers, or 91,000 per year. Thus, the costs added by this rule 
would range from $1.2 million for 91,000 registrants, to $2.1 million 
for 163,000 registrants, and average $1.4 million based on the 110,000 
H-1B filings that are projected to be filed if registration is not 
implemented under this rule.
    Start-up Costs. We assume that H-1B employers would not need to 
expend additional funds to procure computer equipment or acquire 
Internet connections. This assumption is based on the fact that the 
Employment and Training Administration (ETA) of DOL already requires 
employers to use Web-based electronic filing of Labor Condition 
Applications (LCAs), and an approved LCA is a requisite for requesting 
an H-1B employee.\30\ Thus, any establishment that would be registering 
online as proposed by this rule must already have a computer and access 
to the Internet.\31\ Further, the costs of learning how to apply for 
registration are considered in the time for reviewing instructions in 
the paperwork burden above. Therefore, this proposed rule would impose 
no start-up costs on the public.
---------------------------------------------------------------------------

    \30\ 20 CFR 655.705(c)(1); 20 CFR 655.720; 8 CFR 
214.2(h)(ii)(B)(1).
    \31\ In the case of a hardship, ETA allows a paper request for 
an LCA to be filed. ETA received only one request to file in advance 
in the past few years and it was not filed when the requestor was 
asked for further information. ETA rejects about five LCAs per month 
that are filed on paper without approval to file non-electronically. 
No paper LCA has been approved in three years. Thus 100% computer 
ownership is assumed for this analysis. E-mail on file with author 
from Elissa McGovern, ETA, to Phillip Elder, USCIS, July 8, 2009, 11 
a.m.
---------------------------------------------------------------------------

    The cost to H-1B filers over the next 10 years, discounted at three 
and seven percent, is summarized in the following table.

----------------------------------------------------------------------------------------------------------------
                                                                                   Yearly            Yearly
                           Year                               Total yearly     discounted cost   discounted cost
                                                                  cost               3%                7%
----------------------------------------------------------------------------------------------------------------
1.........................................................        $1,400,000        $1,359,223        $1,308,411
2.........................................................         1,400,000         1,319,634         1,222,814
3.........................................................         1,400,000         1,281,198         1,142,817
4.........................................................         1,400,000         1,243,882         1,068,053
5.........................................................         1,400,000         1,207,652           998,181
6.........................................................         1,400,000         1,172,478           932,879
7.........................................................         1,400,000         1,138,328           871,850
8.........................................................         1,400,000         1,105,173           814,813
9.........................................................         1,400,000         1,072,983           761,507
10........................................................         1,400,000         1,041,731           711,689
                                                           -----------------------------------------------------
                                                            Total Discounted        11,942,284         9,833,014
                                                                        Cost
----------------------------------------------------------------------------------------------------------------

7. Breakeven Threshold
    The cost added by this rule is the cost of the extra step now 
required before a petition can be filed--registration. Registration 
would become a fixed cost for all potential and actual filers of an H-
1B petition. Because registration is free except for the time required 
to register, the amount of the added fixed cost is the opportunity cost 
incurred by registrants to take this new step.
    The breakeven threshold is calculated by setting benefits and costs 
equal and solving for the number of petitions. The benefits portion 
equals the cost of completing ($216.18) and mailing ($5.83) a Form I-
129 (total $222.01) multiplied by the number of petitioners over the 
cap limit (unnecessary petitions). This amount represents the total 
amount saved by registrants. The next benefit is the amount saved by 
USCIS from not having to deal with unnecessary petitions 
($412,680).\32\
---------------------------------------------------------------------------

    \32\ Annual average savings totals $412,680 discounted at seven 
percent.
---------------------------------------------------------------------------

    Next, we include the cost component. Each filer will need to 
register online at a cost of $12.66 each, multiplied by the total 
number of registrants. The final component is the additional cost the 
rule imposes on USCIS which totals $486,086.\33\
---------------------------------------------------------------------------

    \33\ $486,086 average annual equivalent costs at seven percent 
discount.
---------------------------------------------------------------------------

    Therefore, based on costs and the conservative estimates for 
aggregate savings for H-1B filers and the Government, the benefits to 
this rule exceed the added costs imposed on all successful and 
unsuccessful registrants when total registrations equal 96,854, or 
exceed the 91,000 to be accepted for processing by 5,854.\34\
---------------------------------------------------------------------------

    \34\ In solving for x, we rounded to the nearest whole number.
---------------------------------------------------------------------------

D. Regulatory Flexibility Act

    The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as 
amended by the Small Business Regulatory Enforcement Fairness Act of 
1996 (Pub. L. 104-121), requires Federal agencies to consider the 
potential impact of regulations on small businesses, small governmental 
jurisdictions, and small organizations during the development of their 
rules.
    Number of small entities to which the proposed rule would apply.
    According to USCIS data on the participants in the employment based 
visa program, and the Small Business Administration (SBA) Small 
Business Size Regulations at 13 CFR part 121, almost all, or about 88.6 
percent, of the petitions requesting an H-1B employee would be filed by 
firms that the size definitions indicate are small entities.\35\ In 
fiscal year 2009 (the most recent breakdown available), forty-two 
percent of petitions approved were for workers in computer-related 
occupations. The second and third most numerous

[[Page 11697]]

occupation groups were architecture, engineering, and surveying, 
followed by education (primary and secondary school teachers and 
college professors).\36\
---------------------------------------------------------------------------

    \35\ See Small Entity Impact Analysis for the 2010 Adjustment of 
USCIS Fee Schedule (Docket USCIS-2009-0033). While we acknowledge 
that the analysis provides estimates of size based on entities that 
file both Form I-129 and Form I-140, we still believe this to be an 
appropriate estimate for those entities that would be impacted by 
this proposed rule.
    \36\ See USCIS Characteristics of H-1B Specialty Occupations 
Workers for FY 2009 at http://www.uscis.gov/USCIS/Resources/Reports%20and%20Studies/H-1B/h1b-fy-09-characteristics.pdf.
---------------------------------------------------------------------------

    USCIS records show that the employers who filed H-1B petitions 
hired an average of 2.24 to 4.16 H-1B employees in fiscal years 2007 
and 2008.\37\ Thus, USCIS estimates that the average number of H-1B 
petitions filed per employer is about three. Therefore, based on 
projected filings of 110,000 per year, it is estimated that around 
36,667 firms that file a petition would be affected by this rule, with 
32,487 of them being classified as small entities (110,000/3 = 36,667 x 
0.886 = 32,487).
---------------------------------------------------------------------------

    \37\ Calculated by dividing the total number of H-1B employees 
by the total number of unduplicated petitioner Employer 
Identification Numbers (EIN).
---------------------------------------------------------------------------

    New Compliance Costs of the Proposed Rule. The proposed rule would 
require employers to electronically register their intention to apply 
for an H-1B worker for the applicable fiscal year. As indicated 
previously, this new requirement would add a cost of $12.66 per worker 
in public annual information collection costs. The average added cost 
per employer for three employees would total $37.98. However, USCIS 
expects that H-1B employers will save money due to this rule when the 
overall costs savings are considered, as these H-1B employers will no 
longer be filing ``unnecessary'' H-1B petitions.
    Significance of Impact and Certification. Guidelines suggested by 
the SBA Office of Advocacy provide that, in order for the impact to be 
considered significant, the cost of a proposed regulation would have to 
exceed one percent of the gross revenues of the entities in a 
particular sector or 5 percent of the labor costs of the entities in 
the sector. The median salary for new H-1B workers in the information 
technology industry is about $50,000, based on USCIS filings. Thus, the 
costs added by this rule are only 0.0003 percent of the salary costs 
for the three workers ($150,000/$37.98 x 100). The average total 
revenue of the typical H-1B employer is unknown. Nonetheless, to exceed 
one percent of annual revenues, sales would have to be $3,798 per year 
or less. Firms with sales below $3,798 would be very unlikely to hire 
three employees and incur the $37.98 in added costs. USCIS believes 
that the costs of this rulemaking to small entities would not exceed 
one percent of annual revenues. Therefore, using both average annual 
labor costs and the percentage of the affected entities' annual revenue 
stream as guidelines and considering that this rule is expected to 
generate a net savings to H-1B employers, USCIS concludes that this 
rule would not have a significant economic impact on a substantial 
number of small entities. For this reason, DHS certifies that this rule 
would not have a significant economic impact on a substantial number of 
small entities.

E. Executive Order 13132

    This rule will not have substantial direct effects on the States, 
on the relationship between the National Government and the States, or 
on the distribution of power and responsibilities among the various 
levels of government. Therefore, in accordance with section 6 of 
Executive Order 13132, it is determined that this rule does not have 
sufficient federalism implications to warrant the preparation of a 
federalism summary impact statement.

F. Executive Order 12988 Civil Justice Reform

    This rule meets the applicable standards in sections 3(a) and 
3(b)(2) of Executive Order 12988, Civil Justice Reform.

G. Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995, Public Law 104-13, 109 
Stat. 163 (1995), all Departments are required to submit to the Office 
of Management and Budget (OMB), for review and approval, any reporting 
or recordkeeping requirements inherent in a regulatory action. This 
rule introduces a new registration requirement for H-1B petitions 
subject to numerical limits, a new information collection under the 
Paperwork Reduction Act. Accordingly, this information collection has 
been submitted to OMB for review.
    During the first 60 days, USCIS is requesting comments on this 
information collection. USCIS will therefore accept comments on this 
information collection until May 2, 2011. When submitting comments on 
this information collection, your comments should address one or more 
of the following four points:
    (1) Evaluate whether the collection of information is necessary for 
the proper performance of the agency, including whether the information 
will have practical utility;
    (2) Evaluate the accuracy of the agency's estimate of the burden of 
the collection of information, including the validity of the 
methodology and assumptions used;
    (3) Enhance the quality, utility, and clarity of the information to 
be collected; and
    (4) Minimize the burden of the collection of the information on 
those who are to respond, including through the use of any and all 
appropriate automated, electronic, mechanical, or other technological 
collection techniques or other forms of information technology, e.g., 
permitting electronic submission of responses.
    Overview of this information collection:
    (1) Type of Information Collection: New information collection.
    (2) Title of the Form/Collection: H-1B Cap Registration.
    (3) Agency form number, if any, and the applicable component of the 
Department of Homeland Security sponsoring the collection: No Form 
Number. This information collection is via Internet only. U.S. 
Citizenship and Immigration Services.
    (4) Affected public who will be asked or required to respond, as 
well as a brief abstract: Primary: Business or other for profit. 
Petitioners seeking to file H-1B petitions for alien workers who are 
subject to the numerical limitations must timely submit a registration 
to USCIS prior to filing such H-1B petitions. By the close of the 
registration period USCIS will randomly select timely submitted 
registrations in a number sufficient to meet the numerical limit.
    (5) An estimate of the total number of respondents and the amount 
of time estimated for an average respondent to respond: 110,000 
respondents at 30 minutes (.50) per response.
    (6) An estimate of the total public burden (in hours) associated 
with the collection: 55,000 annual burden hours.
    All comments and suggestions or questions regarding additional 
information should be directed to the Department of Homeland Security, 
U.S. Citizenship and Immigration Services, Chief, Regulatory Products 
Division, 20 Massachusetts Avenue, NW., Washington, DC 20529-2020.

List of Subjects

8 CFR Part 214

    Administrative practice and procedure, Aliens, Employment, Foreign 
Officials, Health Professions, Reporting and recordkeeping 
requirements, Students.

8 CFR Part 299

    Immigration, Reporting and recordkeeping requirements.


[[Page 11698]]


    Accordingly, parts 214 and 299 of chapter I of title 8 of the Code 
of Federal Regulations are proposed to be amended as follows:

PART 214--NONIMMIGRANT CLASSES

    1. The authority citation for part 214 continues to read as 
follows:

    Authority: 8 U.S.C. 1101, 1102, 1103, 1182, 1184, 1186a, 1187, 
1221, 1281, 1282, 1301-1305 and 1372; sec. 643, Pub. L. 104-208, 110 
Stat. 3009-708; Pub. L. 106-386, 114 Stat. 1477-1480; section 141 of 
the Compacts of Free Association with the Federated States of 
Micronesia and the Republic of the Marshall Islands, and with the 
Government of Palau, 48 U.S.C. 1901 note, and 1931 note, 
respectively; 8 CFR part 2.

    2. Section 214.2 is amended by:
    a. Redesignating paragraph (h)(8)(ii) as paragraph (h)(8)(iii); and 
by
    b. Adding new paragraph (h)(8)(ii).
    The addition reads as follows:


Sec.  214.2  Special requirements for admission, extension, and 
maintenance of status.

* * * * *
    (h) * * *
    (8) * * *
    (ii) Registration for H-1B petitions subject to numerical limits--
(A) General. (1) Registration requirement. Employers seeking to file H-
1B petitions for alien workers who are subject to the numerical 
limitations under section 214(g)(1)(A) of the Act or are exempt from 
those limitations under section 214(g)(5)(C) of the Act must register 
such aliens electronically during a designated registration period in 
accordance with this section and the registration instructions unless 
USCIS temporarily suspends or terminates the registration process, for 
a particular fiscal year, paragraph (h)(8)(ii)(A)(3) of this section. 
USCIS will notify the employer in writing of the selection of one or 
more of the employer's registered beneficiaries on whose behalf the 
employer may file an H-1B petition. An employer may file an H-1B 
petition on behalf of a registered beneficiary only after being 
notified that the petitioner's registration for that beneficiary has 
been selected. Properly filing an H-1B petition following receipt of 
this notification does not guarantee the availability of an H-1B 
number, the approval of the petitions, or the issuance of an H-1B visa.
    (2) Registration period. The registration period will commence 
prior to the earliest date on which petitions may be filed for a 
particular fiscal year, as specified in paragraph (h)(9)(i)(B) of this 
section. USCIS will notify the public via the USCIS Web site of the 
respective start date for the registration period for a particular 
fiscal year prior to the earliest date for filing H-1B petitions for 
such fiscal year as specified in paragraph (h)(9)(i)(B) of this 
section. USCIS will monitor registration receipts and will notify the 
public via the USCIS Web site at http://www.uscis.gov of the end date 
of the registration period. Registrations submitted after the close of 
the registration period will not be considered.
    (3) Suspension or termination. USCIS may temporarily suspend the 
registration process for a given fiscal year or permanently terminate 
the registration process by notice on the USCIS Web site at http://www.uscis.gov. USCIS will provide such notice at least 30 days prior to 
the earliest date for filing H-1B petitions. Upon suspension or 
termination of the registration process, USCIS will implement the 
procedures described in paragraph (h)(8)(iii) of this section for 
calculating the numerical limitation for that fiscal year.
    (B) Filing--(1) Electronic registration. Any registration must be 
filed electronically with USCIS via its Web site at http://www.uscis.gov. No filing fee is required for registration. Employers 
are required to provide the following information about their business 
and the prospective alien beneficiary on the registration:
    (i) The employer's name, employer identification number (EIN), and 
employer's mailing address;
    (ii) The authorized representative's name, job title, and contact 
information (telephone number and e-mail address);
    (iii) The beneficiary's full name, date of birth, country of birth, 
country of citizenship, gender and passport number; and
    (iv) Any additional information requested by the registration or 
USCIS.
    (2) Registering for beneficiaries. Employers must file a separate 
registration for each requested beneficiary, and each beneficiary must 
be named. Multiple beneficiaries cannot be listed in a single 
registration. Only one registration may be submitted by an employer for 
each beneficiary. If USCIS receives more than one registration by the 
same employer for the same H-1B beneficiary, USCIS will accept only the 
first valid registration submitted and reject any duplicate 
registration requests. USCIS will accept more than one registration for 
the same beneficiary so long as each registration relates to a 
different employer.
    (3) Confirmation. Employers will receive electronic notification 
that USCIS has accepted the registration for processing.
    (C) Notifications to file H-1B petitions.
    (1) Numerical limitations not reached by earliest date on which H-
1B petitions may be filed. If USCIS determines that it has received 
fewer registrations than the numerical limitations as of the earliest 
date on which H-1B petitions may be filed, USCIS will notify all 
employers that have properly registered their beneficiaries by this 
date that they are eligible to file H-1B petitions on behalf of such 
registered beneficiaries. The registration period will remain open 
until USCIS determines that it has received sufficient registrations to 
ensure that the numerical limitations will not be exceeded for that 
fiscal year. USCIS may, in its discretion, close the registration 
period at an earlier date to allow for a sufficient period of time to 
receive and process petitions for that fiscal year. USCIS will issue 
notices of selection to file H-1B petitions in the order that 
registrations are received. If USCIS anticipates that it will receive 
more registrations than the numerical limitations, USCIS will announce 
a final receipt date and the closing of the registration period, and 
will conduct a random selection of all registrations received on the 
final receipt date.
    (2) Numerical limitations reached before the earliest date on which 
H-1B petitions may be filed for the new fiscal year. If USCIS 
determines that it has received more registrations than the numerical 
limitations before the earliest date on which H-1B petitions may be 
filed for the new fiscal year, USCIS will close the registration period 
and announce such closure via its Web site at http://www.uscis.gov. 
USCIS will randomly select timely submitted registrations in a number 
sufficient to meet the numerical limit under section 214(g)(1)(A) of 
the Act and the exemption under section 214(g)(5)(C) of the Act. USCIS 
will:
    (i) Notify all selected employers with a selection notice that the 
employer is eligible to file an H-1B petition on behalf of the 
beneficiary named in the selection notice.
    (ii) Maintain, in its discretion, a wait list of some or all 
accepted registrations that were not initially selected as eligible to 
file an H-1B petition, but which may be randomly selected should USCIS 
determine that cap numbers are or will likely remain available for a 
particular fiscal year.
    (iii) Notify employers whose registrations are on the wait list;
    (iv) Notify a wait-listed employer when its registration has been 
selected that it is eligible to file an H-1B petition on behalf of the 
beneficiary named in the selection notice.

[[Page 11699]]

    (v) Notify employers whose registrations are not initially chosen 
or placed on the wait list that they will not be eligible to file an H-
1B petition for the applicable fiscal year.
    (D) H-1B petition filing following registration--(1) General. USCIS 
will consider properly filed only those H-1B petitions for 
beneficiaries subject to a numerical limitation or the exemption under 
section 214(g)(5)(C) from registered employers notified of selection 
and only for those alien beneficiaries named in the original 
registration, in addition to meeting all other filing requirements. 
Petitions filed by employers whose registrations were not selected by 
USCIS will be rejected.
    (2) Filing. Selected employers must file the H-1B petition with 
required supporting documentation and filing fees in accordance with 
the form instructions and applicable statutes and regulations. H-1B 
petitions must be filed within the time period stated on the selection 
notice and must include the selection notice issued under paragraph 
(h)(8)(ii)(C) of this section. The filing period on the selection 
notice will not be less than 60 days. Failure to meet these 
requirements will result in rejection of the H-1B petition and return 
of the filing fees.
* * * * *

PART 299--IMMIGRATION FORMS

    3. The authority citation for part 299 continues to read as 
follows:

    Authority: 8 U.S.C. 1101, 1103; 8 CFR part 2.
    4. Section 299.1 is amended by adding the entry ``H-1B Cap 
Registration'' at the end of the table, to read as follows:


Sec.  299.5  Display of control numbers.

* * * * *

----------------------------------------------------------------------------------------------------------------
               Form No.                          Form title               Currently assigned OMB control No.
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
                                       H-1B Cap Registration.
----------------------------------------------------------------------------------------------------------------


Janet Napolitano,
Secretary.
[FR Doc. 2011-4731 Filed 3-2-11; 8:45 am]
BILLING CODE 9111-97-P