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"The Visa Approval Backlog and its Impact on American Small Business"

June 4, 2003

Prepared Remarks of Mr. William A. Reinsch, President, National Foreign Trade Council, Inc.

On behalf of the National Foreign Trade Council, I am pleased to appear today to express the Council’s views on the growing problem the American business community is experiencing with the processing of visa applications.

Applications are being delayed or denied in such circumstances as: buyers applying to come to the U.S. to take possession of items they have purchased (often having already received an export license from the U.S. government for the item), foreign employees of U.S. companies applying to come here temporarily for training or work on special projects, and potential customers for U.S. goods or services wanting to examine the products and negotiate a purchase.

This problem resulted from changes in the visa application review process made in response to the tragedy of September 11th. The new process ignores commercial considerations, strains our foreign relations by telling business visitors they are unwelcome, and does little to achieve the increased security objectives for which it was intended. The process clearly is in need of revision.

Until July 2002, the State Department processed visa applications involving a visitor’s access to technology pursuant to a relatively transparent, time-limited process. Applications referred to Washington by foreign posts were permitted to go forward in the absence of a reviewing agency’s objection within a defined period of time. The process gave a business a high degree of confidence as to when it would receive a decision and allowed it to determine where an application was in the process so that potential problems could be identified and addressed early. Only if an objection arose was the application delayed for further review. Under this system, the number of reviews was limited, ensuring speedy and thorough service such that security and immigration risks were identified without needlessly delaying applications of legitimate travelers and business people.

As a part of the war on terrorism, last summer the State Department implemented changes to its application review programs that increased the number referred to Washington to be reviewed by an interagency process that includes the FBI and CIA. Those agencies appear to have lowered the bar of what qualifies as a security threat, with the result that applications for individuals who were never previously considered threats have become subject to lengthy delays, compromising the ability of the interagency process to provide a speedy and thorough response. Furthermore, the impending transfer of authority over visa application policy to the Department of Homeland Security has redistributed responsibilities among departments in ways that are still being negotiated, thus delaying the development of a more efficient process.

What the U.S. business community initially thought was a temporary bottleneck in establishing the new procedures has turned into a serious and apparently long term problem. Since last summer, both the certainty of timing and the transparency of the process have disappeared, and, as a result, businesses inviting foreign guests to the U.S. or seeking to bring their own employees to the U.S. can no longer predict with any confidence when, or if, they will be able to do so. The lack of confidence in the timeliness of a response has hurt a growing number of industries.

While denials of these applications have had significant adverse consequences, equally troubling have been the substantial, and varying, delays for applications that are ultimately granted. The hotel industry in the U.S. has directly suffered as a result of these cases. Even though visas are eventually granted for many applications under review, the lack of timeliness and transparency in the process has caused organizers of conventions or conferences that include international guests to relocate their meetings in Canada or elsewhere in order to insure that their foreign participants will be able to attend.

In addition to the commercial interests that have suffered under the new procedures, scientific projects have been delayed. Foreign scientists working in the U.S. have met resistance in renewing their visas, which has resulted in long delays of special projects. With no action-forcing event to guarantee a dependable timeline for the renewal of visas, projects in U.S. labs have stalled under the indefinite absence of key scientists. The disruption of scientific projects has been costly monetarily. Moreover, the loss of intellectual property that could have been gained in the interim, while not quantifiable, has been evident.

From a broader policy perspective, the unexplained delays in visa applications for legitimate travelers to the U.S. have tarnished the image of the U.S. in global business. Travel to the U.S. by foreign scholars, speakers, musicians, scientists, is instrumental in spreading American values and methods of doing business and in building support for U.S. foreign policy objectives. Seemingly arbitrary delays damage these valued relationships and signal to foreigners that the United States is not interested in engaging with them..

In conclusion, the Council believes our visa review programs need to be reformed both to provide for our security needs and to further our foreign policy goals and commercial interests. Reinstituting a disciplined process for time-oriented, reliable and transparent processing of visa applications would serve these objectives. In addition, a return by agency officials to a balanced perspective on visa application reviews that takes into account the damage delays and denials do to international standing and commercial objectives is essential to establishing a fair and efficient application process.