Washington, Oct 17 : The US Chamber of Commerce, the country's biggest business organisation, has sued the Trump administration over the $100,000 H-1B visa application fee, calling it 'unlawful'.

In a lawsuit filed in a district court in Washington on Thursday, the plaintiff argued that the visa fee, if implemented, would 'inflict significant harm on American businesses' and force them to 'either dramatically increase their labour costs or hire fewer highly skilled employees for whom domestic replacements are not readily available.'

It added that Trump's September 19 proclamation is 'plainly unlawful' and a 'boon to America's economic rivals'.

'The Proclamation is not only misguided policy; it is plainly unlawful. The President has significant authority over the entry of noncitizens into the United States. Still, that authority is bounded by statute and cannot directly contradict laws passed by Congress,' it added.

Neil Bradley, Executive Vice President of the US Chamber of Commerce, issued a statement saying that the visa fee would make it 'cost-prohibitive for US employers' to 'access the global talent' and the US economy would 'require more workers, not fewer'.

The Chamber represents approximately 3,00,000 direct members and indirectly represents the interests of more than three million companies and professional organisations in the United States.

It's the second major domestic legal challenge to new H-1B rules, after a group of unions, education professionals and religious bodies sued the Trump administration on October 3.

In a lawsuit filed in the Northern District of California, the plaintiffs had argued that Trump's proclamation was riddled with 'multiple errors' and 'ignores the benefits of the H-1B visa programme to the American economy.'

The case also highlighted that the $100,000 visa application fee was 'unprecedented, unjustified and unlawful'.

The plaintiff included many immigration and advocacy groups, including the Justice Action Center, South Asian American Justice Collaborative, and Democracy Forward Foundation.

While signing the proclamation in September, Trump had said the 'incentive is to hire American workers'.

Commerce Secretary Howard Lutnick had also defended the move, saying the policy would discourage companies from hiring foreign workers.

'So, the whole idea is, no more will these big tech companies or other big companies train foreign workers. They have to pay the government $100,000, then they have to pay the employee. So, it's just not economic. You're going to train somebody. You're going to train one of the recent graduates from one of the great universities across our land, train Americans. Stop bringing in people to take our jobs. That's the policy here. $100,000 a year for H-1B visas,' he explained.

The proclamation caused immense confusion as it seemed to suggest that it would impact the current H-1B visa holders, who may face hurdles in returning to the United States.

The White House issued a clarification on September 20, saying that this is a 'one-time fee' that applies only to new visas and not renewals or current visa holders.

Days later, the US Department of Homeland Security (DHS) also proposed to 'amend its regulations' governing the H-1B visa process.

The DHS plan sought to scrap the existing lottery system and implement a weighted selection process that it says would favour the allocation of H-1B visas to higher-skilled workers.

India-born workers received over 70 per cent of the total approved H1-B visas in 2024, primarily due to a huge backlog in approvals and a high number of skilled immigrants from India.

/IANS