United States – DHS Finalizes H-1B Cap Regulation

United States – DHS Finalizes H-1B Cap Regulation

This report covers a new U.S. rule governing the H-1B cap selection process.



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The Department of Homeland Security (DHS) has now finalized and posted for public inspection the final rule governing changes to the H-1B cap selection process.  The rule was published in the Federal Register on January 31, 2019 and will be effective April 1, 2019.1  (For prior coverage, see GMS Flash Alert 2018-159, December 11, 2018.)  

This final rule reverses the order by which U.S. Citizenship and Immigration Services (USCIS) selects H-1B petitions under the H-1B regular cap and the advanced degree exemption.  Following consideration of public comments received, DHS has elected to postpone implementation of the electronic registration requirement for petitioners seeking to file H-1B cap-subject petitions.


  • The change is expected to increase the number of beneficiaries with a master’s or higher degree to be selected for an H-1B cap number.
  • Employers can anticipate new administrative steps upon implementation of the H-1B cap electronic registration system in FY 2021.


The H-1B visa program allows U.S. companies to temporarily employ foreign workers in specialty occupations.2  Each year, USCIS issues at least 65,000 H-1B visas under the H-1B regular cap and another 20,000 visas for those holding advanced degrees from a U.S. higher education institution.  In prior H-1B cap cycles, USCIS would first run the advanced-degree lottery to select individuals against the U.S. master’s degree exemption.  Any unselected advanced-degree H-1B cap applicants would then enter the H-1B regular cap lottery pool.  Effective April 1, 2019, USCIS will now reverse the selection order so as to count all applicants, including those eligible for the advanced degree exemption, towards the projected number required to reach the H-1B regular cap first.  U.S. advanced-degree holders who are not selected in the regular cap would then be selected towards the advanced degree exemption.  

This reversed selection order will likely increase the number of beneficiaries with a U.S. master’s degree or higher to be selected in the cap lottery.  USCIS estimates that the number of H-1B beneficiaries with advanced degrees selected will increase by up to 16 percent (or 5,340 workers).3

This prioritization of U.S. advanced degree holders is in line with President Trump’s 2017 Buy American and Hire American Executive Order, which targeted the H-1B program and directed DHS and other agencies to “suggest reforms to help ensure that H-1B visas are awarded to the most-skilled or highest-paid petition beneficiaries.” 

USCIS has postponed the electronic registration requirement for the FY 2020 cap season to complete user testing and ensure the system and process are fully functional.4  Once implemented, petitioners seeking to file H-1B cap petitions will be required to first register electronically during a designated period.  USCIS will announce the start of the electronic registration period at least 30 days prior to the commencement of the registration period for each fiscal year.  The registration period will last at least 14 calendar days and will start at least 14 calendar days before the earliest date on which an H-1B cap-subject petition may be filed each fiscal year.  For each selected registration, the petitioner may proceed with completing and filing an H-1B cap petition during the relevant filing period of at least 90 days.


Employers should now identify individuals requiring an H-1B visa sponsorship and finalize job offers to these applicants.  Employers should then provide completed job descriptions for these individuals to their immigration counsel so that Labor Condition Applications (LCA)s may be prepared in a timely manner. 

KPMG Law LLP in Canada will continue to monitor the situation, and will endeavor to keep GMS Flash Alert readers informed as developments occur. 


1  See “Registration Requirement for Petitioners Seeking To File H-1B Petitions on Behalf of Cap-Subject Aliens,” in the Federal Register (online) of January 31, 2019.

2  For a brief background of the H-1B program, see our December 11, 2018 report.

3  See on the USCIS Web site “DHS Announces Final Rule for a More Effective and Efficient H-1B Visa Program.”  

4  Ibid.

* Please note that KPMG LLP (U.S.) does not provide any immigration services.  However, KPMG Law LLP in Canada can assist clients with U.S. immigration matters.   


The information contained in this newsletter was submitted by the KPMG International member firm in Canada.

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GMS Flash Alert is a Global Mobility Services publication of the KPMG LLP Washington National Tax practice. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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