A New Proclamation Collides With a Vacated Rule
In September 2026, the White House issued a presidential proclamation purporting to reinstate the controversial $100,000 supplemental fee on new H-1B petitions. The move arrives despite the fact that a federal district court had already vacated the original fee under the Administrative Procedure Act (APA), finding that the agency action exceeded statutory authority and was implemented without proper notice-and-comment rulemaking.
For employers, sponsors, and foreign national employees who spent the last year adjusting hiring plans, budgets, and immigration strategy around the fee's uncertain status, the new proclamation reopens a chapter many assumed was closed. This article examines the legal posture created by the proclamation, the doctrinal tension between executive proclamation authority and a standing judicial vacatur, and what employers should do while the matter is litigated anew.
How We Got Here
The original $100,000 fee was imposed through executive action tied to the President's authority under Section 212(f) of the Immigration and Nationality Act (8 U.S.C. § 1182(f)), which allows the President to suspend or restrict entry of noncitizens found to be detrimental to U.S. interests. Employers and industry groups challenged the fee, arguing that:
- Section 212(f) authorizes exclusion of entry, not the imposition of a fee scheme layered onto a nonimmigrant visa category already governed by detailed statutory and regulatory fee structures under INA § 214 and related provisions;
- The fee functioned as a substantive rule requiring notice-and-comment rulemaking under the APA, which did not occur; and
- The action was arbitrary and capricious because it lacked a reasoned basis connecting the fee amount to any articulated policy rationale.
A federal district court agreed, vacating the fee under 5 U.S.C. § 706(2)(A). Vacatur under the APA is a significant remedy — it does not merely enjoin enforcement against the parties before the court, but generally sets aside the rule as a matter of law, restoring the regulatory landscape to what existed before the rule's promulgation.
The Legal Problem With Reinstatement by Proclamation
The September 2026 proclamation attempts to revive the fee through a new exercise of executive authority rather than through corrected rulemaking. This raises several immediate legal questions.
Does a new proclamation cure the APA defect? If the underlying legal infirmity was procedural — the failure to engage in notice-and-comment rulemaking — a proclamation alone does not necessarily fix that defect unless the fee is now being implemented through a properly promulgated rule or a mechanism that falls outside APA rulemaking requirements entirely. Practitioners should scrutinize the proclamation's stated legal basis closely, including whether it claims independent constitutional or statutory authority distinct from the vacated rule.
Does Section 212(f) authority extend this far? The Supreme Court's decision in Trump v. Hawaii affirmed broad presidential authority under Section 212(f) to restrict entry based on findings related to the national interest. However, that case involved entry restrictions, not the creation of a monetary fee obligation layered onto a benefit already comprehensively regulated by Congress through the INA's fee and petition structure. Courts are likely to distinguish entry-suspension authority from fee-imposition authority, and litigants will almost certainly renew arguments that the fee exceeds the scope of 212(f).
What is the effect of defying a vacatur order? Where a court has vacated a rule, agencies generally may not simply reissue the same substantive requirement through a different procedural vehicle without addressing the court's specific findings. Attempting to reinstate the identical fee via proclamation, without curing the underlying statutory or procedural defect, invites renewed APA challenges and potential arguments that the action reflects an attempt to evade judicial review rather than a good-faith new agency determination.
Separation of Powers Considerations
This dispute implicates the classic separation-of-powers framework associated with Youngstown Sheet & Tube Co. v. Sawyer. Where Congress has already legislated a comprehensive fee and petition scheme for H-1B visas, executive action that contradicts or supplements that scheme without congressional authorization sits in the weakest zone of executive power — where the President acts against the implied will of Congress. Employers' counsel should expect this argument to feature prominently in renewed litigation.
Practical Implications for Employers
While litigation over the proclamation unfolds, employers face immediate operational uncertainty. Key considerations include:
- Filing timing. Petitions filed while the fee's legal status is contested may be accepted with the fee demanded, refunded later, or subject to processing delays pending litigation outcomes.
- Budgeting and escrow. Employers should consider whether to budget contingently for the fee, and evaluate escrow or reimbursement clauses in sponsorship agreements with affected employees.
- Litigation posture. Trade associations and individual employers with standing may seek expedited injunctive relief, given the precedent of a prior vacatur addressing substantially similar facts.
- Documentation. Employers should preserve records of any fees paid under protest, as restitution or refund claims may depend on demonstrating timely objection.
What to Watch For
Expect rapid developments on several fronts:
- Renewed APA and constitutional challenges filed promptly after the proclamation's effective date;
- Requests for temporary restraining orders or preliminary injunctions given the existing vacatur as persuasive, if not binding, authority;
- Agency guidance (from USCIS and the Department of State) attempting to operationalize the proclamation, which itself may become an independent target for challenge; and
- Possible congressional response, given that a fee of this magnitude touches directly on appropriations and immigration policy traditionally subject to legislative oversight.
Conclusion
The September 2026 proclamation does not exist in a legal vacuum — it exists in direct tension with a federal court's vacatur of substantially the same policy. Employers should not treat the proclamation as settled law, nor assume it will survive judicial scrutiny unchanged. Sophisticated immigration planning in this environment requires close monitoring of agency guidance, careful documentation of fee payments, and early engagement with counsel to preserve legal options as litigation resumes.