The United States Department of Homeland Security on Tuesday said it has finalised amendments to regulations governing the H-1B visa selection process to favour workers who are higher-skilled and better-paid.

The new rules will take effect on February 27 and will be applicable for the financial year 2026-’27 registration period. The number of H-1B visas issued annually is limited to 65,000, with an additional 20,000 for US advanced degree holders.

H-1B visas allow companies in the US to temporarily employ foreign workers for special occupations.

Over the past few years, Indians have constituted the majority of H-1B visa holders. Indians comprised 72.3% of all H-1B visas issued by the US in the financial year 2022-’23.

On Tuesday, the Donald Trump administration said that replacing the lottery system of granting the visa with a process that gives greater weight to persons with higher skills will “better protect the wages, working conditions and job opportunities for American workers”.

The US Citizenship and Immigration Services Spokesperson Matthew Tragesser said that the lottery system had been “exploited and abused by US employers who were primarily seeking to import foreign workers at lower wages than they would pay American workers”.

The Trump administration had proposed to amend the rules on September 23. The proposal had come four days after the White House published a proclamation on September 19 asking companies to pay a one-time $100,000 fee for new H-1B visa applicants.

Prior to this, companies had been paying $215 to register for the H-1B visa lottery, in addition to several filing fees.