dismissed EB-1C Case: Dairy Products

U.S. Citizenship 
and Immigration 
Services 
MATTER OF E- LLC 
APPEAL OF TEXAS SERVICE CENTER DECISION 
~on-Precedent Decision of the 
Administrative Appeals Office 
DATE: MAY 30,2017 
PETITION: FORM I-140, IMMIGRANT PETITION FOR ALIEN WORKER 
The Petitioner, a manufacturer and distributor of dairy products, seeks to permanently employ the 
Beneficiary as its sales and marketing manager under the first preference immigrant classification for 
multinational executives or managers. See Immigration and Nationality Act (the Act) 
section 203(b)(1)(C), 8 U.S.C. § 1153(b)(l)(C). This classification allows a U.S. employer to 
permanently transfer a qualified foreign employee to the United States to work in an executive or 
managerial capacity. 
The Director of the Texas Service Center denied the petition, concluding that the Petitioner did not 
establish, as required, that: (1) the Petitioner has a qualifying relationship with the Beneficiary's 
employer abroad and (2) the Petitioner has the ability to pay the Beneficiary's proffered wage. 
On appeal, the Petitioner submits a brief disputing both grounds as bases for denial. The Petitioner 
contends that it derived an affiliate relationship with the Beneficiary's foreign employer by virtue of 
being "collectively" owned by the same four individuals who "collectively own" the majority of the 
foreign entity's shares. Regarding its ability to pay the Beneficiary's proffered wage, the Petitioner 
provides an analysis of its 2015 tax return showing that the Director's analysis of the Petitioner's 
assets and liabilities was incorrect. 
Upon de novo review, the record contains sufficient evidence to establish that the Petitioner had the 
ability to pay the Beneficiary's proffered wage at the time of filing. Therefore, the Director's decision 
is withdrawn with respect to that specific issue. However, as the Petitioner has not overcome the 
remaining basis for denial and established eligibility for the benefit sought, we will dismiss the appeal. 
I. LEGAL FRAMEWORK 
Section 203(b )(1 )(C) of the Act makes an immigrant visa available to a beneficiary who, in the three 
years preceding the filing of the petition, has been employed outside the United States for at least one 
year in a managerial or executive capacity, and seeks to enter the United States in order to continue to 
render managerial or executive services to the same employer or to its subsidiary or affiliate. 
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Matter ofE- LLC 
A United States employer may file Form I-140, Immigrant Petition for Alien Worker, to classifY a 
beneficiary under section 203(b )(1 )(C) of the Act as a multinational executive or manager. A labor 
certification is not required for this classification. 
The Form I -140 must be accompanied by a statement from an authorized official of the petitioning 
United States employer which demonstrates that the beneficiary has been employed abroad in a 
managerial or executive capacity for at least one year in the three years preceding the- filing of the 
petition, that the beneficiary is coming to work in the United States for the same employer or a 
subsidiary or affiliate of the foreign employer, and that the prospective U.S. employer has been doing 
business for at least one year. 8 C.P.R. § 204.50)(3). 
II. QUALIFYING RELATIONSHIP 
As indicated above, the Director determined that the Petitioner did not establish that it has the 
requisite qualifying relationship with the Beneficiary's foreign employer. 
To establish a "qualifying relationship" under the Act and the regulations, the petitioner must show 
that the beneficiary's foreign employer and the proposed U.S. employer are the 
same employer (i.e. 
a U.S. entity with a foreign office) or related as a "parent and subsidiary" or as "affiliates." See 
generally section 203(b )(1 )(C) of the Act. 
The term "affiliate" means: 
(A) One of two subsidiaries both of which are owned and controlled 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 .... 
8 C.P.R. § 204.5(j)(2). 
The Petitioner has consistently identified the Beneficiary's former employer abroad as 
a Venezuelan entity. The Petitioner 
indicated that it and the foreign entity share common ownership by virtue of collective ownership by 
the same four individuals. The Petitioner submitted a chart, accompanied by supporting evidence, 
showing that it has the following ownership: 
25% 
25% 
25% 
25% 
In a separate chart, the Petitioner described the ownership of the foreign entity: 
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Matter of E- LLC 
20.7% 
20.7% 
20.7% 
20.7% 
- 7.8% 
'-9% 
Finally, the Petitioner indicated that , a Mexican company, is owned in 
equal proportions by the same four individuals who own the petitioning company, and provided 
evidence in support of that claim. 
I 
In denying the petition, the Director based his decision on the claimed organizational structure as 
depicted in the Petitioner's ownership charts. The Director concluded that Petitioner submitted 
insufficient evidence to establish the claimed affiliate relationship. Specifically, the Director found 
that the Petitioner and the foreign entity are not owned and controlled by the same group of 
individuals, with each individual owning and controlling approximately the same share or portion of 
each entity. The Director emphasized that the four members who collectively own 100% of the U.S. 
entity own only 92.2% of the foreign employer. 
On appeal, the Petitioner disputes the Director's finding, claiming that its ownership and control and 
that of the foreign entity "lies in the hands of the same group of individuals ... who collectively own 
all ofthe shares ofthe U.S. entity and 92.2% ofthe shares of the Venezuelan entity." 
Citing Sun Moon Star Advanced Power, Inc. v. Chappel, 773 F. Supp. 1373 (N.D. Cal 1990), the 
Petitioner asserts that the court rejected a "more restrictive interpretatiQn [of the term "affiliate"] 
requiring identical ownership" and instead determined that two companies may be affiliated even 
though they are not owned by the exact same individuals. In Sun Moon Star, the former 
Immigration and Naturalization Service (INS) (now U.S. Citizenship and Immigration Services 
(USCIS)) refused to recognize the indirect ownership of the petitioner by three brothers owning 
shares of the company as individuals through a holding company. The decision stated that the two 
claimed affiliates were not owned by the same group of individuals. The court found that the INS 
decision was inconsistent with previous interpretations of the term "affiliate" and contrary to 
congressional intent because the decision did not recognize indirect ownership. Prior to the 
adjudication of the Sun Moon Star petition, INS amended the regulations so that the definition of 
"subsidiary" recognized indirect ownership. 52 Fed. Reg. 5738, 5741-42 (Feb. 26, 1987). 
Accordingly, the basis for the court's decision has been incorporated into the regulations. However, 
despite the amended regulation and the decision in Sun Moon Star, neither former INS nor USCIS 
has accepted a combination of individual shareholders as a single entity, so that the group may claim 
majority ownership, unless the group members have been shown to be legally bound together as a 
unit within the company by voting agreements or proxies. 
Here, the Petitioner contends that collective ownership of the majority of the Petitioner's and foreign 
entity's shares by the same group of four individuals alone is sufficient to establish the existence of 
an affiliate relationship. As indicated above, the decision in Sun Moon Star does not support the 
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Matter of E- LLC 
Petitioner's contention and the Petitioner has not provided evidence in the form of voting agreements 
or proxies to establish that the and are 
legally bound together as a unit that owns and controls both the Petitioner and the Beneficiary's 
foreign employer. The Petitioner must support its assertions with relevant, probative, and credible 
evidence. See Matter ofChawathe, 25 I&N Dec. 369,376 (AAO 2010). 
Further, the Petitioner's application of the term "approximately the same" is contextually inaccurate, 
as the definition of "affiliate" requires that "the same group of individuals" own "approximately the 
same share or proportion of each entity." 8 C.F.R. § 204.5(j)(2). In other words, the Petitioner and 
the foreign entity cannot have "approximately" the same number of shareholders or "approximately" 
the same group of shareholders; the definition expressly states that the shareholders must be the 
same and that only the amount of ownership interest held by each individual can be approximately 
the same. Here, the record shows that four individuals own the U.S. entity. However, the Petitioner 
claims that the foreign entity is owned by five individuals and a corporate entity. Based on the 
evidence submitted, the Petitioner has not established that it has a qualifying .relationship with the 
Beneficiary's foreign employer based on common ownership by the same group of individuals. 
The Petitioner also refers to the foreign entity's 2014 shareholder meeting minutes during which the 
Beneficiary was elected as the director and president of the company and thereby was "granted 
extensive authority and 
powers to administer and manage the operations and activities of the 
company." The Petitioner explains that the Beneficiary, in his capacity as the elected "member of 
the Council of Administrators" controlled the foreign entity. Control may be "de jure" by reason of 
ownership of 51 percent of outstanding stocks of the other entity or it may be "de facto" by reason of 
control of voting shares through partial ownership and possession of proxy votes. Matter of Hughes, 
18 I&N Dec. 289 (Comm'r 1982). 
Despite showing that the Beneficiary serves as the Petitioner's manager and was previously elected 
to serve as director and president of the foreign entity, these facts do not establish de jure or de facto 
control by the Beneficiary, whose position abroad and with the U.S. entity is subject to the will of 
each entity's shareholders. 1 · 
Accordingly, we agree with the Director's finding that the claimed ownership structure of the 
Petitioner and foreign entity does not establish an affiliate relationship based on the applicable 
regulatory definition. 
Further, although not addressed in the Director's decision, we find insufficient evidence in the record 
to fully document the foreign entity's ownership. Therefore, even if we were to find that an affiliate 
relationship may exist based on the claimed ownership structure described above, additional 
evidence would be required to establish the foreign entity's actual ownership. 
1 
Article V, section 5.3 of the Petitioner's "Company Agreement" states that neither managers nor members have 
authority to make "Major Decisions" without approval of a "Required Interest," which Article I defines as "Members 
holding, individually or in the aggregate, at least 66 2/3% of the Sharing Ratios." Article V, section 5.6 further states 
that "[a] Required Interest may elect to remove a Manager and elect a successor Manager," thereby indicating that 
ultimate control of the Petitioner remains with its member owners. 
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· Matter of E~ LLC 
The Petitioner provided reliable, probative evidence of its ownership including membership 
certificates and recent tax returns that corroborated the information in the membership certificates. 
With respect to the Beneficiary's foreign e~ployer, the Petitioner provided the foreign entity's 
corporate registration document from 1997 and a series of three "corporate amendment documents" 
dated in 2010, 2011, and 2014. 
The 1997 corporate registration document shows that the foreign entity was initially authorized to 
issue 10,000 shares and issued those shares to and 
with each 
receiving 5,000 shares. 
The submitted 201 0 doculi,lent memorializes the meeting minutes of an extraordinary act of the 
foreign entity's shareholders held in October 2010. This document indicates that the ownership of 
the foreign entity as of that date was as follows: 
- 309,400 Class 
A shares 
- 33,800 qass A shares 
- 29,300 Class B shares 
~---------------
' This same document indicates that 
foreign company, with t.he resulting ownership being: 
---
77,350 Class A 
77,350 Class A 
77,350 Class A 
77,350 Class A 
.- 33,800 Class A 
29,300 Class B 
decided to sell all of his shares in the 
(' 
As noted above, the only other evidence ofthe foreign entity's ownership indicated that it authorized 
the issuance of only 10,000 shares, with no separate Class A and Class B types. The Petitioner did 
not explain or document when the company authorized the issuance of 362,500 additional shares of 
stock or when it authorized the issuance of two classes or stock. Therefore, we find the submitted 
evidepce insufficient to support the foreign entity' s claimed ownership. 
III. CONCLUSION 
For the reasons discussed above, the evidence submitted does not establish that the Petitioner has a 
qualifying relationship with the Beneficiary's employer abroad. 
ORDER: The appeal is dismissed. 
Cite as Matter of E- LLC , ID# 341923 (AAO May 30, 20 17) 
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