The L-1 (Intracompany Transferee) Visa Category

The L-1 visa category is one of the most popular categories for investors looking to start-up or purchase a U.S. business.

The Benefits of L Classification

• In regular L-1 cases, a three year initial approval is possible.  For L-1A (managerial/executive) employees, subsequent two year extensions for a maximum grant of seven years are possible.  For L-1B (specialized knowledge) employees, a total of five years is possible.
• In new office cases, the initial grant is one year, with two year extensions available up to the usual L-1A limit of seven years and the L-1B limit of five years.
• Spouses can qualify for L-2 visas and apply for and receive employment authorization cards.
• Children can attend school but not work.  They can hold L-2 status up to age 21.
• Unlike some other work visa categories, L status is protected by “dual intent” – meaning that with the sole exception of major shareholders, there is no requirement of affirmatively needing to show a plan to return abroad after the U.S. assignment.
• For L-1A holders who held an executive and/or managerial post for at least one continuous year before the U.S. transfer, a more expeditious route to U.S. permanent resident (green card) status is possible.

The Key Definition

The L visa category is all based on, and grows out of, a single 8 CFR definition as follows:

Intracompany transferee means a foreign national who, within three years preceding the time of his or her application for admission into the United States, has been employed abroad continuously for one year on a full-time basis by a firm or corporation or other legal entity or parent, branch, affiliate, or subsidiary thereof, and who seeks to enter the United States temporarily in order to render his or her services to a branch of the same employer or a parent, affiliate, or subsidiary thereof in a capacity that is managerial, executive, or involves specialized knowledge. 

Important Note About the Qualifying Period Abroad

Periods spent in the United States in lawful status for a branch of the same employer or parent, affiliate, subsidiary thereof and brief trips to the United States for business or pleasure are not interruptive of the one year of continuous employment abroad. However, such periods shall not be counted toward fulfillment of that requirement.

Qualifying Organization—The Multinational Organization Must Have a Corporate Structure that USCIS Recognizes. Think of this as the “bridge” across which the L visa applicant must cross to move from his or her country of citizenship or residence to enter the U.S. to work on the L visa.

Key definition.

Qualifying organization means a United States or foreign firm, corporation, or other legal entity which:

1. Meets exactly one of the qualifying relationships specified in the definitions of a parent, branch, affiliate or subsidiary; and
2. Is or will be doing business (engaging in international trade is not required) as an employer in the United States and in at least one other country directly through a parent, branch, affiliate, or subsidiary for the duration of the applicant’s stay in the United States as an intracompany transferee.

Corporate Structures that Work for L Visas—Key 8 CFR Regulatory Definitions

1. “Parent” means a firm, corporation, or other legal entity which has subsidiaries.
2. “Branch” means an operating division or office of the same organization housed in a different location.
3. “Subsidiary” means a firm, corporation, or other legal entity of which a parent owns, directly or indirectly, more than half of the entity and controls the entity; or owns, directly or indirectly, 50 percent 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” means

1. One of two subsidiaries both of which are owned and controlled by the same parent or individual, or
2. 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
3. In the case of a partnership that is organized in the United States to provide accounting services along with managerial and/or consulting services and that markets its accounting services under an internationally recognized name under an agreement with a worldwide coordinating organization that is owned and controlled by the member accounting firms, a partnership (or similar organization) that is outside the United States to provide accounting services shall be considered to be an affiliate of the United States partnership if it markets its accounting services under the same internationally recognized name under the agreement with which the worldwide coordinating organization of which the United States partnership is also a member.

Types of Employees Who Can Secure an L Visa

There are three types of L visas that can secure an L visa.  One does not need to hold the same type of qualifying job outside the U.S. in juxtaposition to the proposed U.S. job. In other words, you can be a “managerial” employee abroad, but come to the U.S. to fill a “specialized knowledge” position. Below are the regulatory definitions of the three types of workers:

Executive

Executive capacity means an assignment within an organization in which the employee primarily:

1. Directs the management of the organization or a major component or function of the organization;
2. Establishes the goals and policies of the organization, component, or function;
3. Exercises wide latitude in discretionary decision making; and
4. Receives only general supervision or direction from higher level executives, the board of directors, or stockholders of the organization.

Manager

Managerial capacity means an assignment within an organization in which the employee primarily:

1. Manages the organization, or department, subdivision, function, or component of the organization;
2. Supervises and controls the work of other supervisory, professional, or managerial employees, or manages an essential function within the organization, or a department or subdivision of the organization;
3. Has the authority to hire and fire or recommend those as well as other personnel actions (such as promotion and leave authorization) if another employee or other employees are directly supervised; if no other employee is directly supervised, functions at a senior level within the organizational hierarchy or with respect to the function managed; and
4. Exercises discretion over the day-to-day operations of the activity or function for which the employee has authority.  A first-line supervisor is not considered to be acting in a managerial capacity merely by virtue of the supervisor’s supervisory duties unless the employees supervised are professional.

Specialized Knowledge Employee

Specialized knowledge means special knowledge possessed by an individual of the petitioning organization’s product, service, research, equipment, techniques, management, or other interests and its application in international markets, or an advanced level of knowledge or expertise in the organization’s processes and procedures.

The U.S. Company Must Be Doing Business to Sponsor a L Visa Case.

A shell company cannot sponsor an L visa case.  The U.S. company that files the L visa petition must be doing business and meet the below regulatory definition.

Doing business means the regular, systematic, and continuous provision of goods and/or services by a qualifying organization and does include the mere presence of an agent or office of the qualifying organization in the United States and abroad.

New Office Cases

Where the sponsoring U.S. organization has been doing business in the United States through a parent, branch, affiliate, or subsidiary for less than one year, U.S. Citizenship and Immigration Services (USCIS) can only grant an approval covering an initial period of one year, and additional evidence of the bona fides, finances, staffing and business plans of the organization is necessary.

Specifically, if the petition indicates that the beneficiary is coming to the United States as a manager or executive to open or to be employed in anew office in the United States, the petitioner shall submit evidence that:

1. Sufficient physical premises to house the new office has been secured;
2. The beneficiary has been employed for one continuous year in the three year period preceding the filing of the petition in an executive or managerial capacity and that the proposed employment involved executive or managerial authority over the new operation; and
3. The intended United States operation, within one year of the approval of the petition, will support an executive or managerial position, supported by information regarding:

1. The proposed nature of the office describing the scope of the entity, its organizational structure, and its financial goals;
2. The size of the United States investment and financial ability of the foreign entity to remunerate the beneficiary and to commence doing business in the United States; and
3. The organizational structure of the foreign entity.

If the petition indicates that the beneficiary is coming to the United States in a specialized knowledge capacity to open or to be employed in an new office, the petitioner shall submit evidence that:

Special Requirements for Major Stockholders

If the visa beneficiary is an owner or a major stockholder of the company, the petition must be accompanied by evidence that the beneficiary’s services are to be used for a temporary period and evidence that the beneficiary will be transferred to an assignment abroad upon completion of the temporary services in the United States.  In the past few years, there are reports of denials due to what many attorneys believe is a misapplication of the so-called Neufeld memo, which requires that there be a legitimate employer/employee relationship in place.  Some USCIS officers seem to interpret the law such that if someone is an owner, they cannot also be an employee operating the direction, supervision and control of the corporation.  Having an employment contract or documentation which requires part-owners operating as accountable to the Board of Directors may reduce but not eliminate this risk.

Blanket Petitions May Accelerate the Process for Certain Qualifying Organizations

Blanket Petition – A petitioner which meets the following requirements may file a blanket petition seeking continual approval of itself and some or all of its parent, branches, subsidiaries, and affiliates as qualifying organizations if:

1. The petitioner and each of those entities are engaged in commercial trade or services;
2. The petitioner has an office in the United States that has been doing business for one year or more;
3. The petitioner has three or more domestic or foreign branches, subsidiaries, or affiliates; and
4. The petitioner and other qualifying organizations have obtained approval of petitions for at least ten “L” managers, executives, or specialized knowledge professionals during the previous twelve months; or have U.S. subsidiaries or affiliates with combined annual sales of at least $25 million; or have a United States workforce of at least 1,000 employees.

Checklist of Key Considerations regarding L Visa Viability

• Does a qualifying corporate structure exist?
• Has the foreign national worked full-time as an employee for the commonly owned and controlled foreign company for at least one continuous year out of the immediately preceding past three years?
  • If so, was the employment executive, managerial or specialized knowledge in nature?
• Has the U.S. petitioner been doing business in the U.S. for at least one year, and does it generate revenue and have U.S. staff?  If not, would it be able to position itself to provide the proof necessary to meet the “new office” requirements?
• Will the company abroad continue to do business throughout the period of L employment as is necessary to support continuing L validity?
• Will the U.S. job be executive, managerial or specialized knowledge in nature?
• If the prospective transferee is a major stockholder, will he or she be able to provide indicia of employment and an intent to return to an assignment abroad?
• Looked at from a U.S. government officer’s prospective, is it credible that the U.S. company of that size and business model will be viable and will it require a full-time employee in that particular role?

Other Points

• The more that the U.S. company is established in terms of proof of customers, revenue, and an established office with staff present (unannounced site visits by U.S. Immigration inspectors including prior to adjudication are common), the more comfortable USCIS is likely to be in approving the case.
• For newly established companies in the U.S., the lengthier the track record of success the foreign company can establish in showing its history, revenue stream, payment of staff, payment of taxes, assets, bank accounts, etc., the more credible the USCIS officer is likely to find the case.

Other Visa Options for Investors

In some limited cases, other work visa (or “green card”) categories may be a superior solution. We have, for instance, used the below categories to gain work authorization for some investor and entrepreneur clients in the below categories where appropriate:

1. H1-B Specialty Occupation Work Visa; and
2. O-1 Extraordinary Ability Work visa.

When we conduct an initial consultation, we review all possible options that appear feasible given the facts present.