dismissed
EB-1C
dismissed EB-1C Case: Software Development
Decision Summary
The appeal was dismissed because the petitioner failed to establish a qualifying relationship between the U.S. company and the foreign entity. The petitioner provided insufficient evidence, relying on a stock certificate, and failed to submit crucial documentation like a stock ledger or corporate bylaws to prove ownership and control, as requested by the director.
Criteria Discussed
Qualifying Relationship Managerial Or Executive Capacity Ownership And Control
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U.S. Department of Homeland Security
20 Mass. Ave., N.W., Rm. 3000
Washington, DC 20529-2090
identifying dzta de!cted to
prevent cle.i!y onwci~~anted
invasion of perso~tal privacy
U.S. Citizenship
and Immigration
Services
OFFICE: NEBRASKA SERVICE CENTER
~atePEc 1 9 2008
LIN 06 247 52767
IN RE:
PETITION:
Immigrant Petition for Alien Worker as a Multinational Executive or Manager Pursuant to
Section 203(b)(l)(C) of the Immigration and Nationality Act, 8 U.S.C. $ 1153(b)(l)(C)
ON BEHALF OF PETITIONER:
INSTRUCTIONS:
This is the decision of the Administrative Appeals Office in your case. All documents have been returned to
the office that originally decided your case. Any further inquiry must be made to that office.
If you believe the law was inappropriately applied or you have additional information that you wish to have
considered, you may file a motion to reconsider or a motion to reopen. Please refer to 8 C.F.R. 5 103.5 for
the specific requirements. All motions must be submitted to the office that originally decided your case by
filing a Form I-290B, Notice of Appeal or Motion, with a fee of $585. Any motion must be filed within 30
days of the decision that the motion seeks to reconsider or reopen, as required by 8 C.F.R. 5 103.5(a)(l)(i).
Administrative Appeals Office
DISCUSSION: The preference visa petition was denied by the Director, Nebraska Service Center.
The matter is now before the Administrative Appeals Office (AAO) on appeal. The appeal will be
dismissed.
The petitioner is a New York corporation engaged in the business of software development. The
petitioner seeks to employ the beneficiary as its chief executive officer (CEO). Accordingly, the
petitioner endeavors to classify the beneficiary as an employment-based immigrant pursuant to
section 203(b)(l)(C) of the Immigration and Nationality Act (the Act), 8 U.S.C. 5 1153(b)(l)(C), as
a multinational executive or manager. The director denied the petition based on the following
independent grounds of ineligibility: 1) the petitioner failed to establish that it has a qualifying
relationship with a foreign entity; and 2) the petitioner failed to establish that it would employ the
beneficiary in a managerial or executive capacity.
On appeal, counsel disputes the director's findings, asserting that the beneficiary is the sole
shareholder of the U.S. and foreign entities. Counsel also claims that the beneficiary spends a
majority of his time supervising a managerial staff as well as the petitioner's essential functions.
Counsel's brief and all other supporting documents will be addressed in the discussion below.
Section 203(b) of the Act states in pertinent part:
(1) Priority Workers. -- Visas shall first be made available . . . to qualified immigrants
who are aliens described in any of the following subparagraphs (A) through (C):
(C) Certain Multinational Executives and Managers. -- An alien is
described in this subparagraph if the alien, in the 3 years preceding the
time of the alien's application for classification and admission into the
United States under this subparagraph, has been employed for at least
1 year by a firm or corporation or other legal entity or an affiliate or
subsidiary thereof and who seeks to enter the United States in order to
continue to render services to the same employer or to a subsidiary or
affiliate thereof in a capacity that is managerial or executive.
The language of the statute is specific in limiting this provision to only those executives and
managers who have previously worked for a firm, corporation or other legal entity, or an affiliate or
subsidiary of that entity, and who are coming to the United States to work for the same entity, or its
affiliate or subsidiary.
A United States employer may file a petition on Form 1-140 for classification of an alien under
section 203(b)(l)(C) of the Act as a multinational executive or manager. No labor certification is
required for this classification. The prospective employer in the United States must furnish a job
offer in the form of a statement which indicates that the alien is to be employed in the United States
in a managerial or executive capacity. Such a statement must clearly describe the duties to be
performed by the alien.
The first issue in this proceeding is whether the petitioner has a qualif~ng relationship with the
beneficiary's foreign employer.
The regulation at 8 C.F.R. 9 204.5(i)(2) states in pertinent part:
Affiliate means:
(A) One of two subsidiaries both of which are owned and controlled by the same
parent or individual;
(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;
Multinational means that the qualifying entity, or its affiliate, or subsidiary, conducts
business in two or more countries, one of which is the United States.
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, 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.
In support of the Form 1-140, the petitioner submitted a letter dated August 2,2006 claiming that the
U.S. and foreign entities have a qualifying relationship. However, the petitioner did not specify the
nature of the qualifying relationship, nor did it provide any documentation discussing the ownership
of either entity.
Accordingly, the director issued a request for additional evidence (RFE) dated June 25, 2007,
instructing the petitioner to define its relationship with the foreign entity. The petitioner was also
instructed to provide, inter alia, evidence establishing ownership and control of both entities.
Examples of the types of documents that would be acceptable for purposes of establishing a
qualifying relationship were provided in the RFE.
In response, the petitioner provided an undated letter claiming that the foreign entity, -
, is the petitioner's sole shareholder owning 200 shares of stock. In support of this claim, the
petitioner provided a photocopied stock certificate purporting to issue 200 shares of its stock to
. There is no indication as to the number of shares authorized for issue in the state
where the purported stock issue took place, nor does it appear that the stock certificate was
numbered.
After reviewing the documentation submitted, the director determined that an approval of the
petition was not warranted and therefore issued an adverse decision dated February 5, 2008,
concluding that the petitioner failed to establish that it has a qualifying relationship with the
beneficiary's foreign employer. The director acknowledged the petitioner's submission of a stock
certificate, but noted that no other official documentation was submitted and further pointed out that
the petitioner's 2005 tax return identified the beneficiary as the petitioner's sole shareholder. The
director also noted that the record lacks evidence to establish who owns-
On appeal, counsel explains that he erroneously submitted a deficient stock certificate in response to
the WE and now submits another stock certificate along with a state corporation filing document
showing that the petitioner is authorized to issue 200 shares of stock with no par value. It is noted
that the petitioner provided stock certificate no. 3 on appeal without providing further explanation as
to what happened to stock certificate nos. 1 and 2. That being said, the regulation and case law
confirm that ownership and control are the factors that must be examined in determining whether a
qualifying relationship exists between United States and foreign entities for purposes of this visa
classification. Matter of Church Scientology International, 19 I&N Dec. 593 (BIA 1988); see also
Matter of Siemens Medical Systems, Inc., 19 I&N Dec. 362 (BIA 1986); Matter of Hughes, 18 I&N
Dec. 289 (Comm. 1982). In the context of this visa petition, ownership refers to the direct or
indirect legal right of possession of the assets of an entity with full power and authority to control;
control means the direct or indirect legal right and authority to direct the establishment,
management, and operations of an entity. Matter of Church Scientology International, 19 I&N Dec.
at 595.
As general evidence of a petitioner's claimed qualifying relationship, stock certificates alone are not
sufficient evidence to determine whether a stockholder maintains ownership and control of a
corporate entity. The corporate stock certificate ledger, stock certificate registry, corporate bylaws,
and the minutes of relevant annual shareholder meetings must 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. It is noted that the director's RFE
addressed the need for such documentation by expressly enumerating three documents that would be
satisfactory for the purpose of establishing common ownership and control. The list of documents
included the following: 1) an official stock ledger; 2) copies of corporate bylaws/constitutions
clearly indicating stock ownership; and 3) copies of published annual reports identifying subsidiaries
andlor affiliates and the percentage of ownership held by the parent entity. However, despite the
director's express request, the petitioner did not provide any of these documents, relying solely on
the stock certificate as evidence of ownership. Despite counsel's apparent misconception, the
documentation submitted by the petitioner thus far is insufficient to establish that the beneficiary's
prospective U.S. employer and his employer abroad are commonly owned and controlled.
Therefore, the petitioner has failed to properly document the existence of a qualifying relationship.
For this initial reason, this petition cannot be approved.
The second issue in this proceeding is whether the beneficiary would be employed in a capacity that
is managerial or executive.
Section 101(a)(44)(A) of the Act, 8 U.S.C. tj 1101(a)(44)(A), provides:
The term "managerial capacity" means an assignment within an organization in which the
employee primarily--
Page 5
(i)
manages the organization, or a department, subdivision, function, or
component of the organization;
(ii)
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;
(iii)
if another employee or other employees are directly supervised, has
the authority to hire and fire or recommend those as well as other
personnel actions (such as promotion and leave authorization), or if no
other employee is directly supervised, functions at a senior level
within the organizational hierarchy or with respect to the function
managed; and
(iv)
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.
Section 101 (a)(44)(B) of the Act, 8 U.S.C. fj 1 101(a)(44)(B), provides:
The term "executive capacity" means an assignment within an organization in which the
employee primarily--
(i)
directs the management of the organization or a major component or
function of the organization;
(ii)
establishes the goals and policies of the organization, component, or
function;
(iii)
exercises wide latitude in discretionary decision-making; and
(iv)
receives only general supervision or direction from higher level
executives, the board of directors, or stockholders of the organization.
In the petitioner's August 2, 2006 support letter, the petitioner provided the following description of
the beneficiary's prospective position in the United States:
As the CEO of the petitioner, the beneficiary will have full responsibilities for the
direction and coordination of activities and the operation of the company. He will be
responsible for planning, formulating, and implementing administration and
operational policies and procedures. The beneficiary will occupy the highest position
within the company and will oversee the work of several individuals in the New York
office and over 55 independent contractors working for the company on a regular
basis. The beneficiary will be responsible for marketing the services of the parent
company through subordinate staff and public relations firms.
He will also be
responsible for identifying business opportunities in the U.S. and internationals [sic].
The petitioner also provided an organizational chart, which depicts the beneficiary's position of CEO
as the top-most position within the U.S. entity's four-tier hierarchy. The five positions directly
subordinate to the beneficiary include the marketing and sales department director, the chief of the
financial department, the manager of the production department, the network administrator of the
maintenance and networking department, and the coordinator of international offices (a position that
the beneficiary himself occupies). With the exception of the international offices coordinator, all
other departments list either contracted entities or individuals who perform the services within their
given department.
In the WE, the director informed the petitioner that the proposed job description previously
submitted was insufficient and asked that a more detailed job description be provided. The director
instructed the petitioner to list specific job duties and to assign an estimate of the percentage of time
that would be spent performing each duty. The director also asked that the petitioner provide a
description of job duties for each of the six employees listed in its organizational chart as well as
copies of each individual's Form W-2 for 2006.
With regard to the beneficiary's proposed employment, the first portion of the petitioner's response
was virtually identical to the statement initially provided in which the petitioner discussed the
beneficiary's general responsibilities and his overall role within the petitioning entity's hierarchy.
The petitioner also added the following percentage breakdown discussing how the beneficiary's time
is allotted:
Among the individuals that the beneficiary is supervising are several vice presidents,
marketing directors, sales directors and technical directors. The beneficiary is
spending approximately 60 percent of his time working with the managerial staff of
the company. He is also dedicate [sic] approximately 20% of this time to handle
corporate governance issues such as personnel, finance and expansion plans.
Finally[,] the beneficiary is spending approximately 20% of his time serving as
liaison between the various international and national offices of the petitioner
company. Thus, the beneficiary is responsible for managing not only the essential
functions of the company in terms of corporate direction, but he is also responsible
for managing individuals who have supervisory responsibilities. . . .
[Tlhe beneficiary will be managing the entire organization, many essential functions
of the corporation and will supervise individuals with supervisory capabilities. . . .
[The beneficiary] will be both a functional and a supervisory manager as well and
thus he qualifies as a manager under the regulations.
(emphasis in original).
The petitioner also provided three 2006 Form W-2s, one for the beneficiary, one for the petitioner's
marketing and sales department managing director, and one for the petitioner's production
department manager. Although the petitioner provided five W-4 employee allowance withholding
certificates, two of the certificates were for the year 2003. Therefore, neither document establishes
that the individuals named therein were actually part of the petitioner's organizational hierarchy at
the time the Form 1-140 was filed.
After reviewing the petitioner's submissions, the director determined that the petitioner failed to
establish that it would employ the beneficiary in a qualifying managerial or executive capacity. The
director pointed out that only three W-2 statements were submitted despite the fact that petitioner's
organizational chart listed many more employees. The director also noted that the record lacks
evidence that the petitioner utilizes contractors or has in-house employees to perform its daily
operational tasks.
On appeal, managing director , on behalf of the petitioner, submits a letter dated March
6, 2008, claiming that the beneficiary supervises four employees in the New York office, another
four employees who are based in Florida, and 55 independent contractors. However, going on
record without supporting documentary evidence is not sufficient for purposes of meeting the burden
of proof in these proceedings. Matter of Soffici, 22 I&N Dec. 158, 165 (Comm. 1998) (citing Matter
of Treasure Craft of California, 14 I&N Dec. 190 (Reg. Comm. 1972)). In the present matter, the
petitioner has not provided documentation to support the information put forth in its organizational
chart or the claims currently made on appeal.
As previously noted by the director the
documentation currently on record only establishes the petitioner's employment of
the
beneficiary, and the beneficiary's wife. There is no evidence to establish the petitioner's employment
of other employees, either in-house or on a contractual basis. If the petitioner employed a total of 8
employees and 55 contractors, it is unclear why the petitioner did not provide any payroll
documents, Form W-Zs, or 1099 statements to establish that the individuals identified in the
petitioner's organizational chart were actually performing duties or providing services for the
petitioner at the time the Form 1-140 was filed. See Matter of Katzgbak, 14 I&N Dec. 45, 49
(Comm. 1971) (determining that eligibility must be established at the time the petition is filed).
further asserts that the beneficiary is responsible for marketing the services offered by
the petitioning entity through staff and public relations firms and for identifying business
opportunities in the United States and international markets. However, the beneficiary's ability to
carry out these responsibilities is based on the underlying assumption that the petitioner employs a
sufficient support staff. As discussed above, the AAO cannot assume that the petitioner employs the
claimed staff without documentary evidence. Thus far, the evidence submitted shows the petitioner's
employment of the beneficiary and two other individuals at the time of filing. It is highly unlikely
that the beneficiary would primarily perform duties within a managerial or executive capacity with a
support staff of only two employees, especially given that the petitioner is claiming that a total of 63
employees and contractors are required to carry out its business operations.
Furthermore, when examining the executive or managerial capacity of the beneficiary, the AAO will
look first to the petitioner's description of the job duties. See 8 C.F.R. 3 204.5(')(5). The AAO will
then consider this information in light of the petitioner's organizational hierarchy, the beneficiary's
position therein, and the petitioner's overall ability to relieve the beneficiary from having to
primarily perform the daily operational tasks. In the present matter, the record lacks a
comprehensive description of the beneficiary's day-to-day tasks and does not adequately establish
the availability of support personnel who would perform the petitioner's daily operational tasks such
that the beneficiary would be able to primarily focus on the performance of managerial or executive
duties.
With regard to the job descriptions provided, the petitioner failed to comply with the director's
request for a detailed list of specific job duties. Reciting the beneficiary's vague job responsibilities
or broadly-cast business objectives is not sufficient; the regulations require a detailed description of
the beneficiary's daily job duties. Case law further emphasizes the importance of this crucial
information, establishing that the actual duties themselves will reveal the true nature of the
employment. Fedin Bros. Co., Ltd. v. Suva, 724 F. Supp. 1 103, 1 108 (E.D.N.Y. 1989), afd, 905
F.2d 41 (2d. Cir. 1990). Merely indicating that 60% of the beneficiary's time would be spent
working with the petitioner's managerial staff does not satis@ the director's request for specific job
duties, as this general statement provides no insight as to the actual tasks that would be entailed in
working with a managerial staff whose employment the petitioner has not properly documented.
Stating that another 20% of the beneficiary's time would be spent addressing issues regarding
personnel, finance, and expansion plans is equally vague, conveying no understanding of the types
of underlying duties associated with these broad responsibilities.
Although
also claims that the beneficiary would be employed as a function manager,
the record lacks the necessary evidence and information to support such a finding. If a petitioner
claims that the beneficiary is managing an essential function, the petitioner must furnish a written
job offer that clearly describes the duties to be performed, i.e., identify the function with specificity,
articulate the essential nature of the function, and establish the proportion of the beneficiary's daily
duties attributed to managing the essential function. 8 C.F.R. 5 204.5(j)(5). In addition, the
petitioner's description of the beneficiary's daily duties must demonstrate that the beneficiary will
manage the function rather than perform the duties related to the function. In this matter, the
petitioner has neither defined the essential function in specific terms, nor has the petitioner provided
job duties the beneficiary would perform in his role of function manager. As such,
claim is not persuasive.
In summary, the petitioner has failed to supply key information and evidence specifying how the
beneficiary will spend the primary portion of his time, establishng the existence of a sufficient
support staff, and explaining how their respective roles within the petitioning entity will serve to
relieve the beneficiary from having to primarily perform tasks of a non-qualifying nature. It is noted
that an employee who "primarily" performs the tasks necessary to produce a product or to provide
services is not considered to be "primarily" employed in a managerial or executive capacity. See
sections 101(a)(44)(A) and (B) of the Act (requiring that one "primarily" perform the enumerated
managerial or executive duties); see also Matter of Church Scientology International, 19 I&N Dec.
593, 604 (Comm. 1988). In the present matter, given the lack of relevant information and evidence
documenting the support staff that was in place as of August 2006, the petitioner has failed to
establish that the petitioner was ready and able to employ the beneficiary in a primarily managerial
or executive capacity at the time the Form 1-140 was filed. Therefore, based on this additional
ground, the AAO cannot approve the petition.
Furthermore, the record does not support a finding of eligibility based on additional grounds that
were not previously addressed in the director's decision. Namely, 8 C.F.R. 8 204.5(j)(3)(i)(B) states
Page 9
that the petitioner must establish that the beneficiary was employed abroad in a qualifying
managerial or executive position for at least one out of the three years prior to his entry to the United
States as a nonimmigrant to work for the same employer. In the instant matter, the petitioner's
description of the beneficiary's employment abroad is similarly lacking in the necessary information
regarding the beneficiary's specific job duties. Instead, the petitioner discusses broad job
responsibilities without providing more detailed information as to the actual tasks the beneficiary
performed daily during his employment abroad. Therefore, the AAO cannot conclude that the
beneficiary was employed abroad in a qualifying managerial or executive capacity.
Lastly, given the petitioner's description of its business organization and the beneficiary's proposed
relationship to this business, the AAO questions whether the beneficiary would be an "employee" of
the United States operation. As required by 8 C.F.R. 8 204.5(j)(3)(C), the petitioner must establish
that the prospective employer in the United States is the same employer or a subsidiary or affiliate of
the firm or corporation or other legal entity by which the alien was employed overseas. See 8 C.F.R.
8 204.50)(2) for definitions of afJiliate and subsidiary. It is noted that "employer" and "employed"
are not specifically defined for purposes of the Act even though these terms are used repeatedly in the
context of.addressing the current ernployrnent-based immigrant classification. For example, section
101(a)(44), 8 U.S.C. 8 1101(a)(44), defines both managerial and executive capacity as an assignment
within an organization in which an "employee" performs certain enumerated qualifjmg duties.
The Supreme Court of the United States has determined that where a federal statute fails to clearly
define the term "employee," courts should conclude "that Congress intended to describe the
conventional master-servant relationship as understood by common-law agency doctrine."
Nationwide Mutual Ins. Co. v. Darden, 503 U.S. 318, 322-323 (1992) (hereinafter "Darden")
(quoting Community for Creative Non-Violence v. Reid, 490 U.S. 730 (1989)). That definition is as
follows:
In determining whether a hired party is an employee under the general common law
of agency, we consider the hiring party's right to control the manner and means by
which the product is accomplished. Among the other factors relevant to this inquiry
are the skill required; the source of the instrumentalities and tools; the location of the
work; the duration of the relationship between the parties; whether the hiring party
has the right to assign additional projects to the hired party; the extent of the hired
party's discretion over when and how long to work; the method of payment; the hired
party's role in hiring and paying assistants; whether the work is part of the regular
business of the hiring party; whether the hiring party is in business; the provision of
employee benefits; and the tax treatment of the hired party.
Darden, 503 U.S. at 323-324; see also Restatement (Second) of Agency 4 220(2) (1958); Clackamas
Gastroenterology Associates, P.C. v. Wells, 538 U.S. 440 (2003) (hereinafter "Clackamas"). As the
common-law test contains "no shorthand formula or magic phrase that can be applied to find the
answer, . . . all of the incidents of the relationship must be assessed and weighed with no one factor
being decisive." Darden, 503 U.S. at 324 (quoting NLRB v. United Ins. Co. of America, 390 U.S.
254,258 (1 968).
Page 10
Within the context of immigrant petitions seeking to classify the beneficiary as a multinational
manager or executive, when a worker is also a partner, officer, member of a board of directors, or a
major shareholder, the worker may only be defined as an "employee" if he or she is subject to the
organization's "control." See Clackamas, 538 U.S. at 449-450; see also New Compliance Manual at
8 2-III(A)(l)(d). Factors to be addressed in determining whether a worker, who is also an owner of
the organization, is an employee include:
Whether the organization can hire or fire the individual or set the rules and
regulations of the individual's work.
a
Whether and, if so, to what extent the organization supervises the individual's work.
a
Whether the individual reports to someone higher in the organization.
a
Whether and, if so, to what extent the individual is able to influence the organization.
a
Whether the parties intended that the individual be an employee, as expressed in
written agreements or contracts.
a
Whether the individual shares in the profits, losses, and liabilities of the organization.
Clackamas, 53 8 U. S. at 449-450 (citing New Compliance Manual).
Applying the Darden and Clackamas tests to this matter, the petitioner has not established that the
beneficiary will be an "employee" employed in a managerial or executive capacity. The petitioner is
a corporation, which claims to be ultimately owned and controlled by the beneficiary, who purports
to assume a role as the petitioner's principal. There is no evidence that any other individual has an
ownership interest or is in a position to exercise any control over the work to be perfonned by the
beneficiary.
In view of the above, it appears that the beneficiary will be a proprietor of this business and will not
be an "employee" as defined above. It has not been established that the beneficiary will be
"controlled" by the petitioner or that the beneficiary's employment could be terminated. To the
contrary, the beneficiary is the petitioner for all practical purposes. He will control the organization;
he cannot be fired; he will report to no one; he will set the rules governing his work; and he will
share in all profits and losses. Therefore, based on the tests outlined above, the petitioner has not
established that the beneficiary will be "employed" as an "employee."
An application or petition that fails to comply with the technical requirements of the law may be
denied by the AAO even if the Service Center does not identify all of the grounds for denial in the
initial decision. See Spencer Enterprises, Inc. v. United States, 229 F. Supp. 2d 1025, 1043 (E.D.
Cal. 2001), afd, 345 F.3d 683 (9th Cir. 2003); see also Dor v. INS, 891 F.2d 997,1002 n. 9 (2d Cir.
1989)(noting that the AAO reviews appeals on a de novo basis). Therefore, based on the additional
grounds of ineligibility discussed above, this petition cannot be approved.
The petition will be denied for the above stated reasons, with each considered as an independent and
alternative basis for denial. In visa petition proceedings, the burden of proving eligibility for the
benefit sought remains entirely with the petitioner. Section 291 of the Act, 8 U.S.C. 5 1361. The
petitioner has not sustained that burden.
ORDER: The appeal is dismissed. Avoid the mistakes that led to this denial
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