dismissed EB-1C Case: Manufacturing

U.S. Citizenship 
and Immigration 
Services 
MATTER OF S-P-C- LLC 
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: SEPT. 18, 2019 
MOTION ON ADMINISTRATIVE APPEALS OFFICE DECISION 
PETITION: FORM I-140, IMMIGRANT PETITION FOR ALIEN WORKER 
The Petitioner , a potato chip manufacturer, seeks to permanently employ the Beneficiary as its 
logistics manager under the first preference immigrant classification for multinational executives or 
managers. See Immigration and Nationality Act (the Act) section 203(b)(l)(C) , 8 U.S.C. 
§ l 153(b )(1 )(C). This classification allows a U.S. employer to pennanently transfer a qualified foreign 
employee to the United States to work in an executive or managerial capacity. 
The Director of the Nebraska Service Center denied the petition , concluding that the Petitioner did not 
establish, as required , that: (1) it has a qualifying relationship with the Beneficiary ' s former foreign 
employer; and (2) the Beneficiary was employed abroad in a managerial capacity prior to his entry 
into the United States as a nonimmigrant. We dismissed the Petitioner's appeal of that decision , and 
denied the Petitioner's subsequent combined motion to reopen and reconsider, determining that the 
arguments and evidence submitted did not show proper cause for reopening or reconsideration of our 
prior decision with respect to the issue of the Petitioner's qualifying relationship with the Beneficiary ' s 
foreign employer. 1 
The matter is now before us again on a motion to reconsider. On motion , the Petitioner contends that 
we "improperly applied agency policy and prior case law" and cites to precedent decisions involving 
affiliated companies , claiming that the facts here are "almost identical" to those in the precedents. The 
Petitioner "encourages the AAO to expand the law concerning common ownership in limited 
situations as present in this particular case." 
Upon review, we will deny the motion to reconsider. 
I. MOTION REQUIREMENTS 
A motion to reconsider must establish that our decision was based on an incorrect application of law 
or U.S. Citizenship and Immigration Services (USCIS) policy and that the decision was incorrect 
1 Due to the dispositive nature of our adverse finding regarding the qualifying relationship , we declined to address the new 
evidence and arguments submitted with respect to the Beneficiary ' s employment cap acity abroad . We explained that the 
petition could not be approved even if we determined that the evidence submitted on motion established that he had been 
employed in a managerial capacity as claimed . For the same rea son, we will limit our review of the current motion to 
reconsider to the Petitioner 's legal arguments regarding its qualifying relationship with the Beneficiary's foreign employer. 
Matter of S-P-C- LLC 
based on the evidence in the record of proceedings at the time of the decision. 8 C.F.R. § 103.5(a)(3). 
We may grant a motion that satisfies these requirements and demonstrates eligibility for the requested 
immigration benefit. 
II. ANALYSIS 
The primary issue to be addressed in this decision is whether the Petitioner has made legal arguments 
establishing that our decision to deny its prior combined motion to reopen and reconsider was based 
on an incorrect application of law or USCIS policy. 
A. Background and Prior AAO Decision 
An immigrant visa is 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. Section 203(b)(l)(C) of the Act. 
To establish a "qualifying relationship," a 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 that 
they are related as a "parent and subsidiary" or as "affiliates." See generally section 203(b )(1 )(C) of 
the Act; 8 C.F.R. § 204.5(i)(3)(i)(C). "Affiliate" means one of two subsidiaries, both of which are 
owned and controlled by the same parent or individuals; or 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.F.R. § 204.5(i)(2). 
In this case, the Petitioner must establish a qualifying relationship with a foreign entity that employed 
the Beneficiary for at least one year in the three years preceding his entry to the United States to work 
for the Petitioner as a nonimmigrant in November 2013. See 8 C.F.R. § 204.5(i)(3)(i)(B). During 
most of that three year period, from January 2010 until August 2013, the Beneficiary was an employee 
ot1 I in Canada. 
The record reflects that the Petitioner is wholly-owned byl I and that 
is wholly-owned by I ts son, I I who received ._al_l_l_O_O_sh_a_r_e_s -in_t_h_,e 
company from his father in exchange for one dollar in 2010.2 The record shows thatl lis 
also the majority owner ofl l a Canadian company which employed the 
Beneficiary prior to January 2010 and subsequent to August 2013. 
In denying the previous motion, we found that the Petitioner did not submit new evidence or legal 
arguments to overcome our conclusion that there is no qualifying relationship between the Petitioner 
andl I because the two companies share no common ownershiR. We acknowled ed 
the Petitioner's claim that I I was always considered ard=iv"""'i=s1"""· o-=n'""'o'""'fJ.....;-______ __J 
I I rather than being operated as a separate company, and that~-----' ultimately controls 
all three I !entities. However, we emphasized that, regardless of how the Canadian companies 
function or their working relationship, the regulations and case law confirm that ownership and control 
2 The Petitioner initially claimed tha~.__ __ __,lowns all shares ot1._ _____ ___. 
2 
Matter of S-P-C- LLC 
are the factors that must be examined in determining whether a qualifying relationship exists between 
United States and foreign entities. See, e.g., Matter of Church Scientology Int 'l, 19 I&N Dec. 593 
(Comm'r 1988); Matter of Siemens Med. Sys., Inc., 19 I&N Dec. 362 (Comm'r 1986); Matter of 
Hughes, 18 I&N Dec. 289 (Comm'r 1982). 
We also addressed the Petitioner's claim that I !maintained de facto control over I I ~-~I after transferring all of his shares in the company to his son. We noted that the principles of 
de Jure and de facto control are discussed in Matter of Hughes, 18 I&N Dec. 289,293 (Comm'r 1982) 
and distinguished the facts of that case from those present in this matter. Hughes states that de facto 
control may be "by reason of control of voting shares through partial ownership and by possession of 
proxy votes." 18 I&N Dec. at 293. However, we noted that, consistent with the current regulatory 
definition of"affiliate," Hughes does not contemplate the existence of a qualifying relationship where, 
as here, there is no common ownership between two entities. In fact, Hughes specifically rejects this 
scenario, noting that elements of control "unaccompanied by significant ownership would not alone 
be considered as establishing affiliation" and that "[i]n order to be deemed affiliates, companies should 
be bound to one another by substantial, but not necessarily majority, ownership of shares." Id. 
B. Motion to Reconsider 
On motion, the Petitioner contends that we did not apply "correct law and/or policy." The Petitioner 
maintains that "the relationshi between! I, I l D I I and is so intertwined that any Court would consider that the entities are 
owned by,___ ___ __, run and controlled b~ t' 
Further, citing Sun Moon Star Advanced Power, Inc. v. Chappel, 773 F. Supp. 1373 (N.D. Cal 1990), 
the Petitioner asserts 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 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. 
The Petitioner argues that the court in Sun Moon Star specifically stated that the INS' refusal to 
recognize, as affiliates, entities which may be owned indirectly by the same individuals and in which 
ownership interests may vary slightly, was not consistent with previous interpretations. However, 
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, 5741-2 (Feb. 26, 1987). 
Accordingly, the basis for the court's decision has been incorporated into the regulations. 
Further, Sun Moon Star did not present a situation where one claimed affiliate was owned by one 
individual and the other was owned by a different individual. The ownership here does not "vary 
slightly" - it is completely different. Further, there is no evidence of indirect ownership ofl I 
I !through a third company. The Petitioner has stated thatl lalways operated as 
a division of~-~-----~~ rather than as a separate business, but this does not establish 
3 
Matter of S-P-C- LLC 
the latter's indirect ownership ofl I Sun Moon Star does not support a finding that a 
company can indirectly own another company through an individual. 
The Petitioner also appears to suggest thatl I indirectly owns the company through his son 
because "the sole existence of I I was to avoid tax and liability implications" in an 
arrangement that was "likely a sham." However, Sun Moon Star does not support the Petitioner's 
suggestion that an individual can indirectly own a company through another individual by gifting all 
shares of the company for a nominal sum in a "sham" arrangement. 
The Petitioner also cites to Matter of Tess el, Inc., 17 I&N Dec. 631 (Acting Assoc. Comm'r 1981) and 
asserts that this case establishes that it and I I should be considered affiliates. In the 
Tessel decision, the beneficiary solely owned 93% of the foreign entity and 60% of the petitioner, 
establishing a "high percentage of common ownership and common management." The decision 
further stated that "[ w ]here there is a high percentage of ownership and common management between 
two companies, either directly or indirectly or through a third entity, those companies are 'affiliated' 
within the meaning of that term as used in section 10l(a)(l5)(L) of the Act." Id. at 633. 
However, the facts here can be distinguished from Tessel as the Petitioner is 100% owned by one 
individual and the claimed foreign affiliate is 100% owned by another individual. While the 
companies may be subject to common management, Tessel requires a "high percentage of common 
ownership" in addition to common management. The percentage of common ownership here is 0%. 
The Petitioner also focuses on "indirect" ownership without clearly explaining how indirect ownership 
has been established in the record. For the reasons already discussed, the Petitioner did not establish 
that either! I or ,__ ________ ___,indirectly ownedl I 
In support of its prior motion, the Petitioner cited to an Indiana Court of Appeals decision listing "eight 
factors by which a corporate veil could be pierced." We noted that "piercing a corporate veil" means 
that the law may recognize that individual owners of a corporation may face personal liability despite 
the inherent protections afford to them by corporate entities, and found that it was irrelevant to 
determining the existence of an affiliate relationship as defined at 8 C.F.R. § 204.5(i)(2). The 
Petitioner has returned to this argument, noting that although I I owned the sha~ 
/======,------' operational control remained withl land ultimatelyl__J 
I I The Petitioner asserts: 
The transaction itself of purchasing shares for $1 emphasized the underlying "gift" or 
fa9ade" nature of the transaction itself and if~-------~ had been the 
defendant in litigation it would have been easy to f,ierce the corporate veil and expose 
I I [sic] and I as owners. 
The applicable definition of "affiliate" requires ownership and control by the same parent or 
individual. 8 C.F.R. § 204.5(j)(2). For the purposes of this classification, ownership is established 
through submission of corporate documentation such as stock certificates or membership certificates, 
ledgers, corporate bylaws or operating agreements, and any other documents disclosing the total 
number of shares or membership units issued, the exact number issued to each owner, and the 
subsequent percentage ownership and its effect on corporate control. See Matter of Siemens Med. 
4 
Matter of S-P-C- LLC 
Sys., Inc., 19 I&N Dec. 362 (Comm'r 1986). Here, all shares of the foreign entity are owned by 
I I and we do not need to conduct a farther inquiry regarding the company's ownership 
and control; he has de Jure control over the company as its sole owner regardless of his level of 
involvement with the company's affairs. The Petitioner's suggestion that we must also consider the 
possible outcome of a hypothetical civil lawsuit against ~-----~in order to determine its 
actual ownership is not persuasive. 
Finally, the Petitioner cites to Matter of Huf hes in support of its claim that I lis the de facto 
owner of the Petitioner, I and I However, it has not 
explained how we misapplied Hughes in our prior decision, or established how a person with no legal 
ownership interest in a company acquires defacto control as contemplated by Hughes. 
It is evident that the Petitioner desires tha~ lbe treated as 's wholly-
owned company for Canadian tax liability purposes, and as I Is wholly-owned and 
controlled company for U.S. immigration purposes. However, U.S. immigration law does not allow 
an individual with no documented direct or indirect ownership interest in a company to be considered 
that company's owner for the purposes of establishing a qualifying relationship under section 
203(b)(l)(C) of the Act. 
Accordingly, the Petitioner has not established that we misapplied the law or USCIS policy in denying 
its previous combined motion. 
III. CONCLUSION 
For the reasons discussed, the Petitioner has not shown proper cause for reconsidering our prior 
decision. 
ORDER: The motion to reconsider is denied. 
Cite as Matter of S-P-C- LLC, ID# 55657 54 (AAO Sept. 18, 2019) 
5