WASHINGTON: The United States seems to have violated its commitment under the General Agreement on Trade in Services (GATS) by substantial fee increase in certain categories of H-1B and L1 visas, an eminent American think-tank said today, backing India's argument that such a move is discriminatory and restrictive.
"Significantly increasing the fees for certain H-1B and L-1 visas may be likely to violate US obligations under GATS," said the National Foundation for American Policy, a Washington-based think tank in its report on the increase in H-1B and L1 visa fee.
Signed into law by the US President Barack Obama last year under the Mexico Border Protection Bill , the act increased USD 2,000 for H-1B visas and by USD 2,250 for L-1 visas, but only for employers that employ 50 or more employees in the United States and more than 50 percent of the employees are in H-1B or L-1 status.
"The United States specifically committed in its GATS schedule to allow the temporary entry and stay of individuals under the H-1B and L-1 visa provisions, as they existed when the United States joined the GATS in 1994. Accordingly, additionally restricting the availability of H-1B and L-1 visas could violate this commitment," said the report.
"As a result, a WTO Member whose companies use H-1B and L-1 visas to perform services in the United States may challenge this provision at the World Trade Organization," the report concluded.
Such a challenge could result in retaliation against U S exporters and limit market access for US goods and services, it said.
The report also strengthens the argument of India and the Indian companies that such a legislation is discriminatory and restrictive.
India has already announced its intentions to approach the WTO on this issue.
The hike affected outsourcing companies like Wipro , Tata , Infosys , Satyam but had no impact American companies, said a joint statement issued by Schumer and Gillibrand.
The money from the new fees goes into the US Treasury and was part of legislation to increase border security personnel, equipment, technology, infrastructure, and other resources along the United States southwestern border.
"However, the ultimate purpose of the new fees is not to cover expenses for increased border security. Senator Charles Schumer (NY-D), who introduced the amendment to include the higher fees in the legislation, explicitly stated that the purpose of the fees is to restrict the availability of L-1 and H-1B visas. Thus, Congress' overall intent was reducing the visas' availability, not budget neutrality," the report said.
"The United States made a commitment under the GATS to allow the temporary admission of (non-immigrant) specialty workers under the H-1B and L-1 visa provisions. This commitment generally reflects US law as it existed in 1994 when the GATS and other World Trade Organization (WTO) agreements were finalized," it said.
Because the United States is bound by this commitment under GATS, it may not now adopt or maintain measures that would conflict with that commitment, or nullify or impair the benefits accruing to WTO members under the commitment, the report said.
Accordingly, restricting the availability of H-1B and L-1 visas through the increased fees could violate this commitment under GATS, it added.
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