L-1 visa: Silver Bullet for Foreign Small Business Owners
For foreign owners of small businesses, the L-1 visa has a lot going for it. An L-1 visa allows a business owner to relocate himself and his family to the U.S. in a very short period of time and without the minimum $500,000 required under the EB-5 program
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The L-1 Visa: Silver Bullet for Foreign Small Business Owners?
For foreign owners of small businesses, the L-1 visa has a lot going for it. An L-1 visa allows a business owner to relocate himself and his family to the U.S. in a very short period of time and without the minimum $500,000 required under the EB-5 program. The foreign business owner must have managed his company for at least one year out of the last three, and he must be able to set up a U.S. affiliate company. Thereafter, he “must dedicate a significant portion of time on a regular and systematic basis” to the U.S. affiliate company. There are two different L-1 visa classifications: L1-A and L-1B. L-1A visas are designed for business owners or intra-company executive transferees coming to work in the United States. The L-1A visa allows a company which does not currently have a U.S. office to send the owner or a manager to the United States in order to establish one. The L-1A visa is granted for one year for a new company in the US (or three years for a US company with more than one year in existence) with extensions available in two-year increments, with a total stay not to exceed seven years. L-1B visas are designed for professional employees with specialized knowledge. All the other requirements are the same. Spouses of L-1 visa holders may apply for authorization with USCIS to work in US without restriction. The L1 visa is a dual intent visa. Even though the L-1 visa is a non-immigrant visa, the L-1 visa holder may apply for permanent residency without jeopardizing his/her L-1 visa status or their visa application. If the business owner or employee is already in the U.S., the U.S. company can apply to change his or her status to L-1. If the employee or business owner is still abroad, the U.S. entity must first file an application to the INS in the U.S. Once approved, the approval notice is sent to an U.S. consulate where the business owner or employee can obtain the L1 visa to enter the U.S.
A "Premium Process Program" is available to speed up the process. If the applicant is willing to pay an additional $1,000 to the INS, the INS will process the application within 15 days. The applicant will receive either an approval or a Request for Additional Evidence within 15 days after INS receives the application. If the application is eventually rejected, the INS will refund the paid premium. The initial authorized stay for L-1 visa holders varies from case to case. If the U.S. company is newly established, the initial period of stay permitted is usually only one year with a possible three-year extension. If the U.S. company has been operating for more than one year, a visa holder may be admitted to a maximum initial period of three years. In either event, the total period of stay may be extended to seven years for L-1A managers and business owners. Spouses and children under 21 of L-1 holders can obtain L-2 status and stay in the U.S. with the principal. L-2s can go to school but they are not allowed to work in the U.S. Of course, if L-2s can obtain their own employment-based statuses, such as H-1, or O-1, they then can work in the U.S. L-1 visa holders can apply through the first preference under the employment-based category to obtain the U.S. permanent residency. Unlike people applying through second and third employment-based preferences, applicants for first preference do not need to first obtain a labor certificate from the Department of Labor for further INS application One of the most important benefits of the L-1 visa is that the visa holder can carry "dual intent," meaning that the L-1 holder can apply for permanent residency without negative impact on his or her L-1 visa. Another advantage of this visa classification is when the L-1 visa holder applies for permanent residence he or she is allowed to skip the Labor Certification requirement for the Green Card application. The certification process can be time intensive and highly technical Also, there is no quota limit to the number of L-1 visas available for issuance. The processing time can be sped up to just over two weeks if the applicant opts for the Premium Processing service. The L-1 visa holder is permitted to travel in and out of the U.S. or remain here continuously until the L-1 status expires. Dependents, meaning spouse and unmarried children under 21, can obtain derivative L visas. The spouse of an L-1 visa holder can apply for an
Employment Authorization Card and work for any employer. Family members of the L-1 alien, classified in the L-2 category, may be granted employment authorization to work in the United States after being granted an Employment Authorization Document (EAD). An EAD is a document that allows an alien to work in the United States for a specific time, usually one year. The primary L-1 visa holder does not need an EAD to legally work for their L-1 sponsoring employer in the U.S. because their visa is employment-based, whereas their dependent family members’ are not. Some advantages: L-1 visa holders are given a formal green card, rather than the conditional green card granted to EB-5 applicants, once the green card application is approved. L-1 companies do not face the10-job creation requirement as with the EB-5 programs, and there are no wage requirements. Unlike in the H-1B and Labor Certification applications, L-1s and its following green card applications do not have the strict prevailing wage requirement. L-1visa holders do not have an education requirement, and the employer does not need to get a prevailing wage request. As long as the international relationship exists and the other investment requirement is met, any business may apply to transfer its managers and executives or owner to the U.S.
When considering L-1 petitions, the USICS requires certain types of documents to prove that the petitioning employer and prospective employee(s) meet the necessary requirements. The following lists are examples of documents the USCIS may request. Due to the amount of information required for an L-1 petition, we strongly recommend that you seek the services of a qualified attorney.
Required Documents For the U.S. Company
Article of incorporation or association Application for EIN (Form SS-4) Stock certificates Lease of business location Bank statement or wire transfer evidencing initial investment Audited accounting reports (balance sheets, profit/loss statements, cash flow reports) Corporate income tax return Form 1120 (if any)
Employer's Quarterly Report Form 941 (if any) Description of company business Commercial contracts, invoices, bills of lading, letters of credit, etc. Bank statements Company letterhead (several sheets) Company structure, plan of employing new employees Pictures of the main office (interior and exterior) For the Foreign Company
Business license Article of incorporation Income tax filings for the past three years Audited accounting reports (balance sheets, profit/loss statements, cash flow reports) Organizational chart, total number of employees, position held by the transferee Company brochure or product introduction Documents of business transactions (contracts, bills of lading, letters of credit) Bank statements, or transactional records Company letterhead with company logo, name, and address (several sheets) Pictures of company's main office, factories, or buildings (Disregard if already included in company brochure) From the Applicant
Resume Diploma Employment verification letter from the foreign company Board resolution or appointment documents verifying the transfer
Any other documents showing transferee's capability to conduct business in the executive position.
The following is a summary from the Adjudicator’s Field Manual: 32.6 Technical Issues.
What are legal entities? “In the United States, a business is usually in the form of a corporation, partnership, or a proprietorship. When dealing with a smaller petitioning legal entity, evidence should be provided which establishes that there is a sufficient amount {sic} of employees to continue business operations in the foreign country, as well as continuing business operations in the United States once the beneficiary completes the temporary services and transfers abroad.” The regulations at 8 CFR 214.2(l) (1) (ii) provide examples of the legal entities included under the L-1 classification. Evidence that the employer is a legal entity consists of evidence such as articles of incorporation, partnership agreement, license to do business, or evidence of registration with the Internal Revenue Service. How is it determined that a qualifying business relationship exists? Ownership and control are the factors for establishing a qualifying relationship between business entities. Ownership means the legal right of possession with full power and authority to control. Control means the right and authority to direct the management and operations of the business entity. The petitioner must document ownership and control of both legal entities to establish that a qualifying relationship exists as defined in the regulations. Stock certificates alone may not be sufficient to establish that a qualifying relationship exists. Documents such as the corporate stock certificate ledger, stock certificate registry, corporate bylaws, and the minutes of relevant annual shareholder meetings when appropriate, may also be examined to determine the total number of shares issued, the exact number issued to the shareholder, and the subsequent percentage ownership and its effect on corporate control. When appropriate, a petitioning company may be asked to provide all agreements relating to the voting of shares, the distribution of profit, the management and direction of the petitioning company, and any other factor affecting actual control of the entity. Without full disclosure of all relevant documents, USCIS may be unable to determine the elements of ownership and control. See Matter of Siemens Medical Systems, Inc. ., 19 I&N Dec. 362 (BIA 1986). Evidence of the acquisition of the actual ownership interest (i.e., capital investment, wire transfers, stock purchase agreements, etc.) may be required as additional supporting evidence. See 8 CFR 214.2(l) (3) (viii).
The most common types of business relationships which are not qualifying under the L category are those based on contractual, licensing, and franchise agreements. Additional non-qualifying relationships include arrangements such as less than 50-50 joint ventures and charter membership arrangements. See discussions of various qualifying and nonqualifying relationships in Matter of Schick , 13 I&N Dec. 647; Matter of Del Mar Ben, Inc., 15 I&N Dec. 5; Matter of Aphrodite Investments, Ltd., 17 I&N Dec. 530; Matter of Tessel, Inc., 17 I&N Dec. 631; Matter of Barsai , 18 I&N Dec. 13 ; Matter of Hughes, 18 I&N Dec. 289 ; Matter of Siemens Medical Systems, Inc., 19 I&N Dec. 362. An L-1 petitioning company must be "doing business" as defined in 8 CFR 214.2(l)(1)(ii)(H) in the United States and at least one other country for the duration on the L-1 beneficiary's stay in the United States. In start-up operations, the business in the United States may be prospective in nature. Ordinarily, the viability of the U.S. employer may be demonstrated by the fact that the company has affiliate/subsidiary entities existing and operating under the laws of another country.
Doing business means the regular, systematic, and continuous provision of goods and/or services by a qualifying organization . . . and does not include the mere presence of an agent or office of the qualifying organization in the United States and abroad.
There may be instances where business is conducted through an agent rather than a separate legal entity. The mere presence of such an agent is insufficient to establish that the petitioner is doing business. The petitioner must establish that the entity conducts regular, systematic business (manufacturing, sales, services, etc.). A certified copy of the company’s most recent IRS Form 1120, including all attachments and schedules may also be required. See discussion in Matter of Chartier, 16 I&N Dec. 284 (BIA 1977). Matter of Thompson, 18 I&N Dec. 169 (Comm. 1981), which also discusses this issue, has been superseded by more recent regulations and should not be followed. USCIS experience has revealed that a large number of suspect L-1 petitioners are operating as small import/export firms. If a company is doing business as an import/export firm, USCIS should require the firm to submit multiple examples of the customs forms that would be required in the normal course of business: Form 7525V (Shipper's Export Declaration), Form 7501 (Entry Summary), Form 301 (Customs Bond). The forms should include the importer's identification number. Other forms that would be required in the day-to-day business of an import-export firm would include invoices, shipping manifests, shipping insurance policies, bills of lading, letters of credit, wire transfer advisement, inspection certifications, sales contracts, and general business correspondence. Managerial or Executive Capacity
The discussion of managerial and executive capacity that follows provides guidance for applying the definition of these terms to specific case situations:
An executive or managerial capacity requires a certain level of authority and an appropriate mix of job duties. Managers and executives plan, organize, direct, and control an organization's major functions and work through other employees to achieve the organization's goals. Frontline supervisors, such as those who plan, schedule, and supervise the day-to-day work of nonprofessional employees, are not employed in an executive or managerial capacity, even though they may be referred to as managers in their particular organization. In addition, individuals who primarily perform the tasks necessary to produce the product(s) or provide the service(s) of an organization are not employed in an executive or managerial capacity. See Matter of Church Scientology International, 19 I&N Dec. 593 (Comm. 1988). Eligibility requires that the duties of a position be primarily of an executive or managerial nature. The test is basic to ensure that a person not only has requisite authority, but that a majority of his or her duties relate to operational or policy management, not to the supervision of nonprofessional employees, performance of the duties of another type of position, or other involvement in the operational activities of the company. This does not mean that the executive or manager cannot regularly apply hi s or her technical or professional expertise to a particular problem. Certain positions necessarily require a manager or executive's application of his technical or professional expertise; adjudicators should therefore focus on the primary duties of the beneficiary. An executive or manager may manage or direct a function within an organization. It must be clearly demonstrated, however, that the function is not directly performed by the manager or executive. If the function itself is performed by the intended manager or executive, the position should be viewed as a staff officer or specialist, not as an executive/manager. In general, classification in a specialized knowledge capacity is more appropriate for individuals who perform the duties associated with a function, rather than managing other professional employees or directing the activities or policies of the function. If a small or medium-sized business supports a position wherein the duties are primarily executive or managerial the position may qualify under the L category. However, neither the title of a position nor ownership of the business is, by themselves, indicators of managerial or executive capacity. For example, a physician may incorporate his or her practice for business purposes and may hire a receptionist, bookkeeper, and a nurse to assist in that medical practice. For L purposes, the physician is not a manager, but a person who primarily practices his or her professional skills as a physician. The L beneficiary who is coming to the United States to open a new office may be classified as a manager or executive during the one year required to reach the "doing business" standard if the factors surrounding the establishment of the proposed organization are such that it can be expected that the organization will, within one year, support a managerial or executive position. The factors to be considered include amount of investment, intended personnel structure, product or service to be provided, physic al premises, and viability of the foreign operation. It is expected that a manager or executive who is required to open a new business or office will be more actively involved in day-to-day operations during the initial phases of the business, but must also have authority and plans to hire staff and have wide latitude in making decisions about the goals and management of the organization.
In conclusion, any foreign small business owner who seeks a green card should consider applying for an L-1 visa. This paper attempts to outline several major advantages over other
options such as the EB-5 visa. It is remains unclear to this writer how an L-1 program involving the purchase of one piece of property can meet the doing business test: “Doing business means the regular, systematic, and continuous provision of goods and/or services by a qualifying organization.” A recent LinkedIn post read:
“If you want to move to the USA quickly (within 90 days), we have a signature fast track program that works with business owners using the L-1 Visa process. We are able to help our clients and their families move to the USA. Our L-1 program starts at $255,000 and you will 100% own a 3 bedroom/3 bath resort vacation home with no strings attached and our process fee is less than $50,000. We have a 100% approval rate with the USCIS and our visa can be extended up to 7 years. You will be eligible for converting to a green card after the 1st year with no conditions. Business owners prefer our program over the EB-5, because they only have to pay the taxes on their USA earning instead of using their world-wide earnings like the EB-5. This program only works if you are a business owner.”
Perhaps buying property constitutes a continuous provision of goods and/or services or perhaps I have failed to see a loop hole to this definition. In any event, the L-1 visa can be a great option for the foreign small business owner and should be considered by anyone considering an EB-5 visa if they qualify. __________________________________________________________________________|
About the author: Douglas Slain received a JD from Stanford Law School, a MA from the University of Chicago, a BA from DePauw University, a diploma from University College London, and a certificate from the Goethe Institute in Ulm, Germany. After practicing real estate and finance law at Pillsbury, Madison & Sutro, he founded four national monthly law reporting titles now owned by Thomson-Reuters. He has served two consecutive terms as chairman of the American Bar Association’s General Practice section’s Professional Responsibility Committee. Slain was an ABA-appointed rule of law consultant to the Ministry of Economy for the Republic of Latvia as its secured transactions adviser. He taught for one semester at Stanford Law School as an adjunct clinical law professor. He has been a licensed real estate agent in Hawaii, a licensed real estate broker and insurance licensee in California, and he has held U.S. securities series 22 and 63 licenses. Slain currently is the principle of Private Placement Advisors, LLC. He is the founder of RegDConsumersReport.com, and he manages a LinkedIn discussion group with close to 1,000 members, Securities Enforcement Group. Slain recently launched two web sites, EB5Asean.com and EB5Analysticsgroup.com; his primary web site, however, remains privateplacementadvisors.com. Retired from his law practice, Slain splits his time between a Buddhist monastery near Chiang Rai, Thailand, and his home in Mill Valley, CA.
For foreign owners of small businesses, the L-1 visa has a lot going for it. An L-1 visa allows a business owner to relocate himself and his family to the U.S. in a very short period of time and without the minimum $500,000 required under the EB-5 program. The foreign business owner must have managed his company for at least one year out of the last three, and he must be able to set up a U.S. affiliate company. Thereafter, he “must dedicate a significant portion of time on a regular and systematic basis” to the U.S. affiliate company. There are two different L-1 visa classifications: L1-A and L-1B. L-1A visas are designed for business owners or intra-company executive transferees coming to work in the United States. The L-1A visa allows a company which does not currently have a U.S. office to send the owner or a manager to the United States in order to establish one. The L-1A visa is granted for one year for a new company in the US (or three years for a US company with more than one year in existence) with extensions available in two-year increments, with a total stay not to exceed seven years. L-1B visas are designed for professional employees with specialized knowledge. All the other requirements are the same. Spouses of L-1 visa holders may apply for authorization with USCIS to work in US without restriction. The L1 visa is a dual intent visa. Even though the L-1 visa is a non-immigrant visa, the L-1 visa holder may apply for permanent residency without jeopardizing his/her L-1 visa status or their visa application. If the business owner or employee is already in the U.S., the U.S. company can apply to change his or her status to L-1. If the employee or business owner is still abroad, the U.S. entity must first file an application to the INS in the U.S. Once approved, the approval notice is sent to an U.S. consulate where the business owner or employee can obtain the L1 visa to enter the U.S.
A "Premium Process Program" is available to speed up the process. If the applicant is willing to pay an additional $1,000 to the INS, the INS will process the application within 15 days. The applicant will receive either an approval or a Request for Additional Evidence within 15 days after INS receives the application. If the application is eventually rejected, the INS will refund the paid premium. The initial authorized stay for L-1 visa holders varies from case to case. If the U.S. company is newly established, the initial period of stay permitted is usually only one year with a possible three-year extension. If the U.S. company has been operating for more than one year, a visa holder may be admitted to a maximum initial period of three years. In either event, the total period of stay may be extended to seven years for L-1A managers and business owners. Spouses and children under 21 of L-1 holders can obtain L-2 status and stay in the U.S. with the principal. L-2s can go to school but they are not allowed to work in the U.S. Of course, if L-2s can obtain their own employment-based statuses, such as H-1, or O-1, they then can work in the U.S. L-1 visa holders can apply through the first preference under the employment-based category to obtain the U.S. permanent residency. Unlike people applying through second and third employment-based preferences, applicants for first preference do not need to first obtain a labor certificate from the Department of Labor for further INS application One of the most important benefits of the L-1 visa is that the visa holder can carry "dual intent," meaning that the L-1 holder can apply for permanent residency without negative impact on his or her L-1 visa. Another advantage of this visa classification is when the L-1 visa holder applies for permanent residence he or she is allowed to skip the Labor Certification requirement for the Green Card application. The certification process can be time intensive and highly technical Also, there is no quota limit to the number of L-1 visas available for issuance. The processing time can be sped up to just over two weeks if the applicant opts for the Premium Processing service. The L-1 visa holder is permitted to travel in and out of the U.S. or remain here continuously until the L-1 status expires. Dependents, meaning spouse and unmarried children under 21, can obtain derivative L visas. The spouse of an L-1 visa holder can apply for an
Employment Authorization Card and work for any employer. Family members of the L-1 alien, classified in the L-2 category, may be granted employment authorization to work in the United States after being granted an Employment Authorization Document (EAD). An EAD is a document that allows an alien to work in the United States for a specific time, usually one year. The primary L-1 visa holder does not need an EAD to legally work for their L-1 sponsoring employer in the U.S. because their visa is employment-based, whereas their dependent family members’ are not. Some advantages: L-1 visa holders are given a formal green card, rather than the conditional green card granted to EB-5 applicants, once the green card application is approved. L-1 companies do not face the10-job creation requirement as with the EB-5 programs, and there are no wage requirements. Unlike in the H-1B and Labor Certification applications, L-1s and its following green card applications do not have the strict prevailing wage requirement. L-1visa holders do not have an education requirement, and the employer does not need to get a prevailing wage request. As long as the international relationship exists and the other investment requirement is met, any business may apply to transfer its managers and executives or owner to the U.S.
When considering L-1 petitions, the USICS requires certain types of documents to prove that the petitioning employer and prospective employee(s) meet the necessary requirements. The following lists are examples of documents the USCIS may request. Due to the amount of information required for an L-1 petition, we strongly recommend that you seek the services of a qualified attorney.
Required Documents For the U.S. Company
Article of incorporation or association Application for EIN (Form SS-4) Stock certificates Lease of business location Bank statement or wire transfer evidencing initial investment Audited accounting reports (balance sheets, profit/loss statements, cash flow reports) Corporate income tax return Form 1120 (if any)
Employer's Quarterly Report Form 941 (if any) Description of company business Commercial contracts, invoices, bills of lading, letters of credit, etc. Bank statements Company letterhead (several sheets) Company structure, plan of employing new employees Pictures of the main office (interior and exterior) For the Foreign Company
Business license Article of incorporation Income tax filings for the past three years Audited accounting reports (balance sheets, profit/loss statements, cash flow reports) Organizational chart, total number of employees, position held by the transferee Company brochure or product introduction Documents of business transactions (contracts, bills of lading, letters of credit) Bank statements, or transactional records Company letterhead with company logo, name, and address (several sheets) Pictures of company's main office, factories, or buildings (Disregard if already included in company brochure) From the Applicant
Resume Diploma Employment verification letter from the foreign company Board resolution or appointment documents verifying the transfer
Any other documents showing transferee's capability to conduct business in the executive position.
The following is a summary from the Adjudicator’s Field Manual: 32.6 Technical Issues.
What are legal entities? “In the United States, a business is usually in the form of a corporation, partnership, or a proprietorship. When dealing with a smaller petitioning legal entity, evidence should be provided which establishes that there is a sufficient amount {sic} of employees to continue business operations in the foreign country, as well as continuing business operations in the United States once the beneficiary completes the temporary services and transfers abroad.” The regulations at 8 CFR 214.2(l) (1) (ii) provide examples of the legal entities included under the L-1 classification. Evidence that the employer is a legal entity consists of evidence such as articles of incorporation, partnership agreement, license to do business, or evidence of registration with the Internal Revenue Service. How is it determined that a qualifying business relationship exists? Ownership and control are the factors for establishing a qualifying relationship between business entities. Ownership means the legal right of possession with full power and authority to control. Control means the right and authority to direct the management and operations of the business entity. The petitioner must document ownership and control of both legal entities to establish that a qualifying relationship exists as defined in the regulations. Stock certificates alone may not be sufficient to establish that a qualifying relationship exists. Documents such as the corporate stock certificate ledger, stock certificate registry, corporate bylaws, and the minutes of relevant annual shareholder meetings when appropriate, may also be examined to determine the total number of shares issued, the exact number issued to the shareholder, and the subsequent percentage ownership and its effect on corporate control. When appropriate, a petitioning company may be asked to provide all agreements relating to the voting of shares, the distribution of profit, the management and direction of the petitioning company, and any other factor affecting actual control of the entity. Without full disclosure of all relevant documents, USCIS may be unable to determine the elements of ownership and control. See Matter of Siemens Medical Systems, Inc. ., 19 I&N Dec. 362 (BIA 1986). Evidence of the acquisition of the actual ownership interest (i.e., capital investment, wire transfers, stock purchase agreements, etc.) may be required as additional supporting evidence. See 8 CFR 214.2(l) (3) (viii).
The most common types of business relationships which are not qualifying under the L category are those based on contractual, licensing, and franchise agreements. Additional non-qualifying relationships include arrangements such as less than 50-50 joint ventures and charter membership arrangements. See discussions of various qualifying and nonqualifying relationships in Matter of Schick , 13 I&N Dec. 647; Matter of Del Mar Ben, Inc., 15 I&N Dec. 5; Matter of Aphrodite Investments, Ltd., 17 I&N Dec. 530; Matter of Tessel, Inc., 17 I&N Dec. 631; Matter of Barsai , 18 I&N Dec. 13 ; Matter of Hughes, 18 I&N Dec. 289 ; Matter of Siemens Medical Systems, Inc., 19 I&N Dec. 362. An L-1 petitioning company must be "doing business" as defined in 8 CFR 214.2(l)(1)(ii)(H) in the United States and at least one other country for the duration on the L-1 beneficiary's stay in the United States. In start-up operations, the business in the United States may be prospective in nature. Ordinarily, the viability of the U.S. employer may be demonstrated by the fact that the company has affiliate/subsidiary entities existing and operating under the laws of another country.
Doing business means the regular, systematic, and continuous provision of goods and/or services by a qualifying organization . . . and does not include the mere presence of an agent or office of the qualifying organization in the United States and abroad.
There may be instances where business is conducted through an agent rather than a separate legal entity. The mere presence of such an agent is insufficient to establish that the petitioner is doing business. The petitioner must establish that the entity conducts regular, systematic business (manufacturing, sales, services, etc.). A certified copy of the company’s most recent IRS Form 1120, including all attachments and schedules may also be required. See discussion in Matter of Chartier, 16 I&N Dec. 284 (BIA 1977). Matter of Thompson, 18 I&N Dec. 169 (Comm. 1981), which also discusses this issue, has been superseded by more recent regulations and should not be followed. USCIS experience has revealed that a large number of suspect L-1 petitioners are operating as small import/export firms. If a company is doing business as an import/export firm, USCIS should require the firm to submit multiple examples of the customs forms that would be required in the normal course of business: Form 7525V (Shipper's Export Declaration), Form 7501 (Entry Summary), Form 301 (Customs Bond). The forms should include the importer's identification number. Other forms that would be required in the day-to-day business of an import-export firm would include invoices, shipping manifests, shipping insurance policies, bills of lading, letters of credit, wire transfer advisement, inspection certifications, sales contracts, and general business correspondence. Managerial or Executive Capacity
The discussion of managerial and executive capacity that follows provides guidance for applying the definition of these terms to specific case situations:
An executive or managerial capacity requires a certain level of authority and an appropriate mix of job duties. Managers and executives plan, organize, direct, and control an organization's major functions and work through other employees to achieve the organization's goals. Frontline supervisors, such as those who plan, schedule, and supervise the day-to-day work of nonprofessional employees, are not employed in an executive or managerial capacity, even though they may be referred to as managers in their particular organization. In addition, individuals who primarily perform the tasks necessary to produce the product(s) or provide the service(s) of an organization are not employed in an executive or managerial capacity. See Matter of Church Scientology International, 19 I&N Dec. 593 (Comm. 1988). Eligibility requires that the duties of a position be primarily of an executive or managerial nature. The test is basic to ensure that a person not only has requisite authority, but that a majority of his or her duties relate to operational or policy management, not to the supervision of nonprofessional employees, performance of the duties of another type of position, or other involvement in the operational activities of the company. This does not mean that the executive or manager cannot regularly apply hi s or her technical or professional expertise to a particular problem. Certain positions necessarily require a manager or executive's application of his technical or professional expertise; adjudicators should therefore focus on the primary duties of the beneficiary. An executive or manager may manage or direct a function within an organization. It must be clearly demonstrated, however, that the function is not directly performed by the manager or executive. If the function itself is performed by the intended manager or executive, the position should be viewed as a staff officer or specialist, not as an executive/manager. In general, classification in a specialized knowledge capacity is more appropriate for individuals who perform the duties associated with a function, rather than managing other professional employees or directing the activities or policies of the function. If a small or medium-sized business supports a position wherein the duties are primarily executive or managerial the position may qualify under the L category. However, neither the title of a position nor ownership of the business is, by themselves, indicators of managerial or executive capacity. For example, a physician may incorporate his or her practice for business purposes and may hire a receptionist, bookkeeper, and a nurse to assist in that medical practice. For L purposes, the physician is not a manager, but a person who primarily practices his or her professional skills as a physician. The L beneficiary who is coming to the United States to open a new office may be classified as a manager or executive during the one year required to reach the "doing business" standard if the factors surrounding the establishment of the proposed organization are such that it can be expected that the organization will, within one year, support a managerial or executive position. The factors to be considered include amount of investment, intended personnel structure, product or service to be provided, physic al premises, and viability of the foreign operation. It is expected that a manager or executive who is required to open a new business or office will be more actively involved in day-to-day operations during the initial phases of the business, but must also have authority and plans to hire staff and have wide latitude in making decisions about the goals and management of the organization.
In conclusion, any foreign small business owner who seeks a green card should consider applying for an L-1 visa. This paper attempts to outline several major advantages over other
options such as the EB-5 visa. It is remains unclear to this writer how an L-1 program involving the purchase of one piece of property can meet the doing business test: “Doing business means the regular, systematic, and continuous provision of goods and/or services by a qualifying organization.” A recent LinkedIn post read:
“If you want to move to the USA quickly (within 90 days), we have a signature fast track program that works with business owners using the L-1 Visa process. We are able to help our clients and their families move to the USA. Our L-1 program starts at $255,000 and you will 100% own a 3 bedroom/3 bath resort vacation home with no strings attached and our process fee is less than $50,000. We have a 100% approval rate with the USCIS and our visa can be extended up to 7 years. You will be eligible for converting to a green card after the 1st year with no conditions. Business owners prefer our program over the EB-5, because they only have to pay the taxes on their USA earning instead of using their world-wide earnings like the EB-5. This program only works if you are a business owner.”
Perhaps buying property constitutes a continuous provision of goods and/or services or perhaps I have failed to see a loop hole to this definition. In any event, the L-1 visa can be a great option for the foreign small business owner and should be considered by anyone considering an EB-5 visa if they qualify. __________________________________________________________________________|
About the author: Douglas Slain received a JD from Stanford Law School, a MA from the University of Chicago, a BA from DePauw University, a diploma from University College London, and a certificate from the Goethe Institute in Ulm, Germany. After practicing real estate and finance law at Pillsbury, Madison & Sutro, he founded four national monthly law reporting titles now owned by Thomson-Reuters. He has served two consecutive terms as chairman of the American Bar Association’s General Practice section’s Professional Responsibility Committee. Slain was an ABA-appointed rule of law consultant to the Ministry of Economy for the Republic of Latvia as its secured transactions adviser. He taught for one semester at Stanford Law School as an adjunct clinical law professor. He has been a licensed real estate agent in Hawaii, a licensed real estate broker and insurance licensee in California, and he has held U.S. securities series 22 and 63 licenses. Slain currently is the principle of Private Placement Advisors, LLC. He is the founder of RegDConsumersReport.com, and he manages a LinkedIn discussion group with close to 1,000 members, Securities Enforcement Group. Slain recently launched two web sites, EB5Asean.com and EB5Analysticsgroup.com; his primary web site, however, remains privateplacementadvisors.com. Retired from his law practice, Slain splits his time between a Buddhist monastery near Chiang Rai, Thailand, and his home in Mill Valley, CA.
