Requirements of Organization
1. Requirement of Qualified Organization
A company must establish that it has reached a stage of organizational development, and it has such complexity that it can be realistically concluded that the individual seeking transfer is primarily engaged in executive or managerial duties.
To qualify as an L-1 petitioner, an employer, either U.S. or foreign employer, must establish that it is affiliated as a parent, subsidiary or affiliate with a U.S. multinational company, and that it wishes to transfer a manager, executive or specialized knowledge employee from the foreign company to the U.S. company. To establish this affiliation, a company must provide the USCIS with following documents:
corporate family charts;
documentation of common ownership.
In addition to the requirement that the individual seeking transfer should be employed in a managerial, executive or specialized knowledge capacity, the Immigration and Nationality Act (INA) requires that the individual has been employed in a full-time capacity for the foreign parent, branch, affiliate or subsidiary for at least one year within the previous three years.
2. The Definition of Foreign Parent, Branch, Affiliate or Subsidiary
L-1 visas are available only to employees of companies outside the U.S. that have related U.S. parents, branches, subsidiaries, affiliates, or joint venture partners. There is also a special category for international accounting firms. For visa purposes, these terms have the following specific definitions.
1) "Parent" is defined as a firm, corporation, or other legal entity which has subsidiaries.
2) "Branch" is defined as an operating division or office of the same organization housed in a different location.
3) "Subsidiary" is defined as a firm, corporation or other legal entity of which a parent owns, directly or indirectly, more than half of the entity; or owns, directly or indirectly, 50% of a 50-50 joint venture and has equal control and veto power over the entity; or owns, directly or indirectly, less than half of the entity, but in fact controls the entity.
4) "Affiliate" is defined as:
(a). one of two subsidiaries both of which are owned by the same parent or individual, or
(b). one of two legal entities owned and controlled by the same group of individuals, each individual owning and controlling approximately the same share or proportion of each entity, or
(c). certain international accounting firms.
5) Joint Venture Partners: Although there is no common ownership between the two companies, they have jointly undertaken a common business operation or project.
6. International Accounting Firms. In the case of big accounting firms, the interests between one country and another are not usually close enough to qualify as affiliates under normal L-1 visa rules. Nevertheless, the law considers the managers of such companies qualified to support L-1 visa petitions for their employees. The firm must be part of an international accounting organization with an internationally recognized name.
While staffing levels of the business are not as crucial in determining whether or not an individual is acting in an executive or managerial capacity, it is nevertheless a factor in such a determination. However, the INA specifically states that if staffing levels are used as a factor, the reasonable needs of the organization, component or function in light of the overall purpose and stage of development must be taken into account.
3. The Qualifying Company for L1 Visa Application
The USCIS defines the term "qualifying organization" as a U.S. or foreign entity which meets the requirements of a parent, branch, subsidiary, or affiliate and is or will be doing business as an employer in the United States, and at least one other country for the duration of the alien's stay in the United States as an intracompany transferee.
This definition requires that the U.S. employer continue to have a related entity doing business abroad. That entity, however, needs not be the alien's former employer. There is nothing in the definition to prevent the dissolution or sale of the former employer so long as another affiliate continues to do business abroad.
The U.S. immigration regulations also permit entities other than a corporation to serve as a qualifying company for L1 visa petitioner. The partnerships and even sole proprietorships can serve as qualifying companies for L1 visa petition purposes. In a non-corporate case, it is important to establish that the employing company is a separate entity from the employee being transferred from a foreign country.
In the case of a larger, well-established company which operates in a legal form other than a corporation, the L1 visa may be still available, but there will be a heavier burden of proof to establish the separate business and economic identity of the company.
In either case of corporation or non-corporation, the prior employer or foreign company must be related to the U.S. company or partnership/sole proprietorship, either as a subsidiary, affiliate or division. In most cases, the relationship must be documented and provided to USCIS. The documentation of the corporation relationship may not need to be documented in the case of large, well-known multinational corporations.
4. L-1 Petitions for for Beneficiaries Opening a New Office in the United States
The L-1 visa is an option for a foreign company that that seeks to send an employee to work at a company in the United States. The L-1 visa is also a good option for a foreign company to send an alien employee to open a new office in the United States. The alien employee should have a set of professional skills, and either be a manager/executive (L-1A visa) or having particular specialized knowledge (L-1B visa).
For a foreign company to start a new business in the United States, the L-1 intra-company transfer visa allows to start operations in the U.S., move key personnel who are managers, executives and specialized knowledge employees. The L-1 visa allows qualified executives and managers a faster path to secure U.S. Green Card under the EB1 Multinational Executive or Manager (EB-1C) category. The L-1 visa to start a new business in the United States is widely used by citizens of foreign countries that are not on the E-1 or E-2 treaty list, such as China and India, among many others.
In the past few years, there is an increase in Requests for Evidence (RFE) and denials of L-1 petitions. This is particularly the case for applicants in the specialized knowledge category or those seeking to extend a L-1 visa that was granted for opening a new office in the United States. The USCIS adjudicator's scrutiny makes an L-1 petition an extremely document intensive visa category that must be prepared carefully.
Special rules apply for aliens being transferred to open a new office in U.S. A new office means an organization which has been doing business in the United States through a parent, branch, affiliate or subsidiary for less than one year. Generally, these types of petitions are initially approved for only one year and additional evidence, such as evidence of office space, a business plan and more, must be submitted with the petition.
Even a foreign company does not have a pre-existing subsidiary or affiliate operating in the United States, it is possible for individuals to be transferred to the United States under L-1 status for the purpose of opening a new office. However, special regulations will apply to persons being transferred as new office L-1's. The most significant of these regulations limit the initial approval period to one year, after which additional evidence will have to be filed to evidence the U.S. office's need for a managerial or executive employee. There are 4 main requirements to obtain an L-1 visa which are alsp applied for opening a new office in the United States:
1) The U.S. employer must have a qualifying relationship with a foreign company. This means that the foreign company and the entity in the U.S. should have a relationship such as parent, branch, subsidiary or affiliate, and the U.S. entity and foreign company should share common ownership and control.
2) The U.S. company should be doing business in the United States;
3) The employee must have been working for the foreign company for one continuous year out of the preceding three years, by normally showing payroll records to prove it, and
4) The employee must be entering the United States to work at the U.S. company as a manager, executive or specialized worker.
Remember that even if a foreign company is opening a new office in the U.S., it is always the U.S. entity or employer that will actually apply for the L-1 visa. For a manager or executive to come to United States to open a new office, you should provide the following evidence:
1) sufficient real estate space has been secured to operate a new office;
2) you have been employed for one continuous year in the three year period preceding the filing of the L1 visa petition in an executive or managerial capacity, and the proposed employment involves executive or managerial authority over the new operation;
3) the intended United States operation will support an executive or managerial position.
You may also provide the following information regarding:
the proposed nature of the office describing the scope of the entity, its organizational structure, and its financial goals;
the size of the United States investment;
the financial ability of the foreign entity to remunerate the beneficiary and to commence doing business in the United States;
and the organizational structure of the foreign entity.
5. The Business Plan for L1 Visa Application of New Office Openning in U.S.
United States is the land of opportunity. Many foreign businesses want to open a company in United states after achieving success in their home country. For a foreign company to move key personnel to the U.S., the new office L1 visa is a great option.
To start a business in U.S., the L1 visa allows to move key personnel who are managers, executives and specialized knowledge employees into the United States. The L1 visa also allows qualified executives and managers a faster path to receive U.S. Green Card under the EB-1C category. The L1 visa is widely used by citizens of countries that are not on the E-1 visa or E-2 visa treaty list, such as China and India, and many other countries. To qualify for an L1 visa to open a new office in United States, the petitioner must submit the following evidence:
* the sufficient physical premises to house the new office have been secured;
* the beneficiary meets the one-year continuous employment requirement;
* petitioner has the financial ability to commence doing business in the United States;
* the intended U.S. operation will support an executive, or managerial position within one year, If the beneficiary is coming to the United States as a manager or executive;
* submit a "Business Plan"
The petitioner should submit a "Business Plan". although not as complex and thorough as one that you would submit to investors, a business plan has become required for successful new office L1 petition. The Business Plan offers the petitioner an opportunity to succinctly lay out details about the new venture, a personnel plan to hire, and forward-looking projections.
The business plan for this purpose should have about 10 pages, like a executive summaries of a fully featured business plans. It is important to include the following items in the business plan:
1) personnel plan for the new office in the U.S. detailing how many employees the newly formed U.S. Company plans to hire in the first year and, preferably, over the next four to five years.
2) Financial projections (revenues, costs, and others), setting out the company's short-term and long-term goals.
6. The L1 Visa One-Year Foreign Employment Requirement
The L-1 nonimmigrant classification allows a U.S. employer to transfer an executive or manager (L-1A) or an employee with specialized knowledge (L-1B) from one of its qualifying foreign offices to one of its offices in the United States. The L1 visa allows a foreign company that does not yet have a qualifying U.S. office to send an executive or manager, or specialized knowledge employee, to the United States to establish one.
In order for an L-1 petition to be approved, one of the basic requirements is that the beneficiary has worked abroad for a related entity for at least one year in the past three years. This is often referred to as the “one-in-three” rule. The U.S. Citizenship and Immigration Services (USCIS) has clarified how USCIS officers should calculate the one-year period of foreign employment when the beneficiary has traveled to the United States during that period.
1) Time spent in U.S. while employed by foreign entity does not count: USCIS clarified that L1 beneficiaries must be physically outside the United States during the required continuous one-year duration of employment. Brief trips to the United States for business or pleasure do not interrupt the continuous one year, but the number of days the beneficiary spends in the United States ultimately will be subtracted from the time the qualifying foreign organization employs the beneficiary abroad.
Also, the L1 visa the petitioner and the beneficiary must meet all requirements, including the one-year of foreign employment, at the time the initial L-1 petition is filed.
2) Time spent in U.S. for related U.S. entity adjusts three-year period: In order to qualify for L1, one must have worked for the foreign entity for at least one year in the past three years. Normally, the three-year period to be examined is the three years immediately preceding the date the petition was filed.
However, USCIS explains that there is an exception to the period looked at to meet the requirement for the one-in-three rule. If the foreign national worked for the foreign entity, and then comes to the U.S. to work for the related U.S. entity in a status other than L1 (e.g., H1B, E-2), the USCIS officer should look at the three-year period immediately prior to the individual’s having been admitted to the United States.
7. L-1 Petitions for Beneficiaries of a Startup Company
While ordinarily L-1 beneficiaries are transferred from an established foreign company to an established U.S. company, beneficiaries may also enter the U.S. in L-1A or L-1B status to work for a startup company. A startup company is one that has been engaged in the regular, systematic provision of goods or services for less than one year.
The startup company, like any other company petitioning for an L-1 beneficiary, must exist in a qualifying corporate relationship with the company abroad at which the beneficiary has worked.
An L-1 will not be granted for a startup company until significant plans have been laid for the new company. The new company must have already been incorporated, and must have obtained an Employer Identification Number (EIN). The company must also have already secured physical premises in the U.S. sufficient to house the new operation. The petitioner must provide USCIS with evidence of those premises in the form of a lease or title deed.
If the petition is for an L-1A beneficiary, the petitioner must also provide a business plan sufficient to show that within one year, the company will have grown to the point where it can support a managerial or executive position.
Unlike traditional L-1s, L-1s granted for startup companies are only issued for an initial period of one year. The purpose behind this limitation is to allow USCIS to review the financial status of the new company after one year, to ensure that it is becoming or has become a viable company capable of supporting an L-1 beneficiary. After the one year has passed, the L-1 status can be renewed in two-year increments all the way up to the 5-year maximum for L-1Bs or the 7-year maximum for L-1As.
8. The Organizational Chart for L-1A Visa Application and L-1A Visa Extension
The organizational charts are important pieces of the L-1 visa application or L-1 visa extension. Every company should submit two organization charts, one for the home country office and the other for the company in the U.S. They are especially important when the company seeks to send an executive or a manager to the U.S. on an L-1A visa. When transferring persons from higher company ranks, the role of the organization chart is to show that the concerned person is an executive or a manager, and to present a clear view to USCIS about the company’s personnel expansion plans in the new U.S. office.
When it comes to organization charts, creativity is highly discouraged and the best organization charts are those that provide a clear hierarchical view of the company’s leadership from top to bottom. One common problem in making organization charts is that companies often insist on including department or divisions on the chart. This should be avoided, because it only provides a confusing picture to USCIS.
The various departments or divisions should be represented by its personnel on the chart and not as separate entities by the name of the division. The idea behind the organization chart as used in the immigration context is to show the personnel reporting structure in your home company and the U.S. entity.
9. The L-1B Visa for Alien Workers with Specialized Knowledge
The L-1B visa enables a U.S. employer to transfer a professional employee with specialized knowledge relating to the organization’s interests from one of its foreign offices to one of its offices in the U.S. The L-1B visa also enables a foreign company which does not yet have an affiliated U.S. office to send a specialized knowledge employee to the U.S. to help establish a new office.
The term “specialized knowledge” refers to the employee’s understanding of the employer company, including its products, services, research, equipment, techniques, management or other interests and its application in international markets, or advanced knowledge of the company’s processes and procedures. USCIS and consular officers will be looking for knowledge that is not widely held throughout the industry, but is truly specialized. They will also be looking to see that such knowledge is not readily available within the United States .
10. How to Organize the Evidence Accompanied with the L-1 Visa Application
Follow the tips below for how to organize the evidence accompanied with the L-1 visa application:
1) Provide all required documentation and evidence with the L-1 visa application when filed. L-1 visa application may be denied in the instances where the required evidence described in the instructions and regulations are not initially provided. If providing photocopies of documents, provide clear legible copies.
2) All foreign language documents must be submitted with a corresponding English translation. The English translation must be certified by a translator who is competent to translate and must verify in writing that “the translation is true and accurate to the best of the translator's abilities.“ It is helpful if the English translation is stapled to the foreign language document.
3) If documenting the alien's publications or citations of the alien beneficiary's work, highlight the alien's name in the relevant articles. It is not necessary to send the full copy of document, or research paper written by the alien beneficiary, or one in which the alien beneficiary's work has been cited. Include the title page and the portions that cite the alien's work.
4) Tab and label the evidentiary exhibits at the bottom of the first page of each exhibit, and provide a list of the evidentiary exhibits and the eligibility criteria that each exhibit is submitted to establish for petitions supported by a substantial amount of documentation. An exhibit that is being provided to meet multiple eligibility criteria should be so identified in the exhibit list.
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