dismissed EB-3 Case: Culinary Arts

MATTER OF H-, INC. 
APPEAL OF TEXAS SERVICE CENTER DECISION 
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: SEPT. 15,2017 
PETITION: FORM 1-140, IMMIGRANT PETITION FOR ALIEN WORKER 
The Petitioner, a holding company, seeks to employ the Beneficiary as an Indian specialty chef. It 
requests classification of the Beneficiary as a skilled worker under the third preference immigrant 
classification. See Immigration and Nationality Act (the Act) section 203(b)(3)(A)(i), 8 U.S.C. 
§ 1153(b)(3)(A)(i). This employment-based immigrant classification allows a U.S. employer to 
sponsor a foreign national for lawful permanent resident status to work in a position that requires at 
least two years of training or experience. 
The Director of the Texas Service Center denied the petition, concluding that the Petitioner did not 
establish that it is a successor-in-interest to the entity that filed the labor certification. 
On appeal, the Petitioner states that the corporate reorganization of the labor certification employer 
as its subsidiary demonstrates that a successor-in-interest relationship has been established. 
Upon de novo review, we will dismiss the appeal. 
I. LAW 
Employment-based immigration generally follows a three-step process. First, an employer obtains 
an approved ETA Form 9089, Application for Permanent Employment Certification (labor 
certification) from the U.S. Department of Labor (DOL).' See section 212(a)(5)(A)(i) ofthe Act, 
8 U.S.C. § 1182(a)(5)(A)(i). By approving the labor certification, DOL certifies that there are 
insufficient U.S. workers who are able, willing, qualified, and available for the offered position and that 
employing a foreign national in the position will not adversely affect the wages and working conditions 
of domestic workers similarly employed. Section 212(a)(5)(A)(i)(I)-(II) of the Act. Second, the 
employer files an immigrant visa petition with U.S. Citizenship and Immigration Services 
(USCIS). See section 204 of the Act, 8 U.S.C. § 1154. Third, if USCIS approves the petition, the 
foreign national may apply for an immigrant visa abroad or, if eligible, adjustment of status in the 
United States. See section 245 of the Act, 8 U.S.C. § 1255. 
1 
The date the labor certification is filed, in cases such as this one, is called the "priority date." 
.
Matter of H-, Inc. 
II. ANALYSIS 
The labor certification in this case was filed on February 26, 2014, by with a Federal 
Employer Identification Number (FEIN) of The subsequent Form 1-140 was filed on 
December 21, 
2015 by (FEIN . The actual corporate name of the entity 
with this FEIN is 
A labor certification is only valid for the particular job opportunity stated on the application form. 
20 C.F.R. § 656.30(c). If the Petitioner is a different entity than the employer listed on the labor 
certification, the Petitioner must establish that it is a successor-in-interest to that entity. Successor­
in-interest determinations are adjudicated in accordance with Matter of Dial Auto Repair Shop. Inc., 
19 I&N Dec. 481 (Comm'r 1986) .. 
Establishing a successor-in-interest relationship under Matter of Dial Auto is a three-part test.2 First, 
the petitioning successor must fully describe and document the transaction transferring ownership of 
all, or a relevant part of, the beneficiary's predecessor employer. Second, the petitioning successor 
must demonstrate that the job opportunity is the same as originally ofiered on the labor certification. 
Third, the petitioning successor must prove by a preponderance of the evidence that it is eligible for 
the immigrant visa in all respects. !d. 
The Director's decision denying the petition concluded that the labor certification employer and the 
Petitioner are separate corporate entities, and that the Petitioner did not establish that it is a 
successor-in-interest to the labor certification employer. 
On appeal, the Petitioner states that the labor certification employer is a Qualified Subchapter S 
Subsidiary (QSSS) of through a corporate reorganization on May 1, 2006. · 
Therefore, the labor certification employer, is a wholly-owned subsidiary of 
the Petitioner. We note that this corporate reorganization occurred several years 
prior to the filing of the labor certification. · 
·Specifically, the Petitioner states that owned two Indian restaurants that were 
separate corporate entities, one of which was . the labor certification employer. In May 
2006, the two restaurants became wholly-owned subsidiaries ofthe newly-formed 
the Petitioner. The two subsidiary restaurants were designated as qualified subchapter S 
subsidiaries and they continued to do business. 
The Petitioner states that its IRS Form 1120S for 2006 constitutes evidence of the reorganization in 
which became a subsidiary of and establishes the successor-in-
2 
See also Memorandum from Donald Neufeld, Acting Associate Director, Domestic Operations, Successor-in-interest 
Determinations in Adjudication of Form 1-140 Petitions; Adjudicators Field Manual (AFM) Update to Chapter 
22.2(b)(5) (AD09-37). HQ 70/6.2 AD 09-37, August 6, 2009. 
2 
.
Matter of H-. Inc. 
interest relationship between the Petitioner and the labor certification employer. The footnote to 
statement 1 on the 2006 Form 1120S states that it is a short year return due to a corporate 
reorganization and that became a QSSS of 
The Petitioner cites a Virginia Department of Taxation, Tax Commissioner Ruling, which states that 
"a qualified subchapter S subsidiary is not treated as a separate entity for federal taxation purposes 
and will not have any federal taxable income" and that the subsidiary "will continue its legal 
existence and business activities in the Commonwealth of Virginia." See Commonwealth (~( 
Virginia, 1997 WL 584684, at *2. This ruling also states that "[f]or federal income tax purposes, the 
Parent will be considered the owner of all the Taxpayer's assets and liabilities." /d. 
A QSSS is a subsidiary corporation wholly owned by an S corporation that has made a valid election 
for the subsidiary. I.R.C. § 1361(b)(3)(B). A QSSS is not treated as a separate corporationj(Jr 
federal income tax purposes. Treas. Reg. § 1.1361-4(a)(l)(i) (2008); see also l.R.C. 
§ 1361 (b )(3 )(A)(i). All assets, liabilities, and items of income, deduction, and credit of the QSSS are 
treated as assets, liabilities, and items of income, deduction, and credit of the parent S 
corporation. Treas. Reg.§ 1.1361-4(a)(l)(ii) (2008); see also I.R.C. § 1361(b)(3)(A)(ii). There is 
no separate federal income tax return for a QSSS. Its operations are reported in the parent S 
. corporation's federal income tax return. 
However, a QSSS is treated as a separate entity for federal employment taxes. Treas. Reg. § 1.1361-
4(a)(7). Accordingly, the QSSS is responsible for employment taxes on wages paid to its employees 
and satisfying its other employment tax obligations. !d. A QSSS also remains a separate entity 
under state law. 
In short, a QSSS is not treated as a separate entity for federal income tax purposes but nonetheless 
continues its legal existence as a separate entity for other purposes. 
The corporate reorganization that the Petitioner claims gives nse to a successor-in-interest 
relationship occurred several years prior to the filing of the labor certitlcation. Therefore, there was 
no transaction that occurred between the filing of the labor certification and the petition that would 
support a successor-in-interest claim. Further, while this reorganization resulted in special treatment 
for federal income tax purposes, the Petitioner has not established that there has been an actual 
transfer of the essential rights and obligations of to in all other 
respects to establish a successor-and-interest relationship. 
Therefore, the record does not establish that the Petitioner stated on the Form I-140 is a successor-in­
interest to the labor certitlcation employer. 
III. CONCLUSION 
The appeal will be dismissed because the Petitioner has not established that it is the same entity as, 
or a successor-in-interest to, the employer that filed the labor certification. 
3 
Matter of H-, Inc. 
ORDER: The appeal is dismissed. 
Cite as Matter of H-, Inc., ID# 510958 (AAO Sept. 15, 20 17) 
4