dismissed EB-3 Case: Retail Management

U.S. Department of Homeland Security 
20 Mass. Ave., N.W., Rm. 3000 
Washington, DC 20529 
U. S. Citizenship 
and Immigration 
PUBLIC COPY 
PETITION: Immigrant petition for Alien Worker as a Skilled Worker or Professional pursuant to section 
203(b)(3) of the Immigration and Nationality Act, 8 U.S.C. 5 1 153(b)(3) 
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. 
Robert P. Wiemann, CNf 
Administrative Appeals Office 
Page 2 
DISCUSSION: The preference visa petition was denied by the Acting Director (Director), Vermont Service 
Center. After granting a motion to reopen, the director affirmed the decision and denied the petition. The 
matter is now before the Administrative Appeals Office (AAO) on appeal. The appeal will be dismissed. 
The petitioner is a convenience store. It seeks to employ the beneficiary permanently in the United States as a 
retail store manager (assistant manager). As required by statute, the petition is accompanied by a Form ETA 
750, Application for Alien Employment Certification, approved by the Department of Labor (DOL). The 
director determined that the petitioner had not established that it had the continuing ability to pay the 
beneficiary the proffered wage beginning on the priority date of the visa petition. The director denied the 
petition accordingly. 
The record shows that the appeal is properly filed, timely and makes a specific allegation of error in law or 
fact. The procedural history in this case is documented by the record and incorporated into the decision. 
Further elaboration of the procedural history will be made only as necessary. 
As set forth in the director's October 7, 2005 and February 23, 2006 decisions, the only issue in this case is 
whether or not the petitioner has the ability to pay the proffered wage as of the priority date and continuing 
until the beneficiary obtains lawful permanent residence. 
Section 203(b)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. $ 1 153(b)(3)(A)(i), 
provides for the granting of preference classification to qualified immigrants who are capable, at the time of 
petitioning for classification under this paragraph, of performing skilled labor (requiring at least two years 
training or experience), not of a temporary nature, for which qualified workers are not available in the United 
States. 
The regulation 8 C.F.R. $204.5(g)(2) states in pertinent part: 
Ability of prospective employer to pay wage. Any petition filed by or for an employment- 
based immigrant which requires an offer of employment must be accompanied by evidence 
that the prospective United States employer has the ability to pay the proffered wage. The 
petitioner must demonstrate this ability at the time the priority date is established and 
continuing until the beneficiary obtains lawful permanent residence. Evidence of this ability 
shall be in the form of copies of annual reports, federal tax returns, or audited financial 
statements. 
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the priority 
date, which is the date the Form ETA 750 Application for Alien Employment Certification, was accepted for 
processing by any office within the employment system of the U.S. Department of Labor. See 8 C.F.R.. $ 
204.5(d). The petitioner must also demonstrate that, on the priority date, the beneficiary had the qualifications 
stated on its Form ETA 750 Application for Alien Employment Certification as certified by the U.S. Department 
of Labor and submitted with the instant petition. Matter of Wing's Tea House, 16 I&N Dec. 158 (Act. Reg. 
Cornm. 1977). I 
Page 3 
The instant petition is for a substituted beneficiary.' The original Form ETA 750 was accepted on April 27, 
2001. The proffered wage as stated on the Form ETA 750 is $10.00 per hour ($20,800 per year). The Form 
ETA 750 states that the position requires two years of experience in the job offered and experience in Wizard 
and MS Word computer software and in handling Halal meats and Halal products. The 1-140 petition was 
submitted on May 20, 2005. On the petition, the petitioner claimed to have been established in 1997, to have 
a gross annual income of $343,731, to have a net annual income of $27,190, and to currently employ 6 
workers. With the petition, the petitioner submitted a Fonn ETA 750B with information pertaining to .the 
qualifications of the new beneficiary. On the Form ETA 750B signed by the beneficiary on May 16, 2005, 
the beneficiary did not claim to have worked for the petitioner. 
The AAO takes a de novo look at issues raised in the denial of this petition. See Dor v. INS, 891 F.2d 997, 
1002 n. 9 (2d Cir. 1989)(noting that the AAO reviews appeals on a de novo basis). The AAO considers all 
pertinent evidence in the record includin new evidence properly submitted upon appeal2. On appeal, 
counsel submits a letter fiommthe accountant of the petitioner, as new evidence. Other relevant 
evidence in the record includes the petitioner's corporate federal tax returns for 2001 through 2003. The 
record does not contain any other evidence relevant to the petitioner's ability to pay the wage. 
On appeal, the petitioner asserts that the director failed to consider the personal assets of the petitioner's sole 
shareholder in determining the petitioner's ability to pay the proffered wage. 
The petitioner must establish that its job offer to the beneficiary is a realistic one. Because the filing of an 
ETA 750 labor certification application establishes a priority date for any immigrant petition later based on the 
ETA 750, the petitioner must establish that the job offer was realistic as of the priority date and that the offer 
remained realistic for each year thereafter, until the beneficiary obtains lawhl permanent residence. The 
petitioner's ability to pay the proffered wage is an essential element in evaluating whether a job offer is realistic. 
See Matter of Great Wall, 16 I&N Dec. 142 (Acting Reg. Comm. 1977). See also 8 C.F.R. 5 204.5(g)(2). In 
evaluating whether a job offer is realistic, Citizenship and Immigration Services (CIS) requires the petitioner to 
demonstrate financial resources sufficient to pay the beneficiary's proffered wages, although the totality of the 
circumstances affecting the petitioning business will be considered if the evidence warrants such consideration. 
See Matter of Sonegawa, 12 I&N Dec. 612 (Reg. Comm. 1967). 
In determining the petitioner's ability to pay the proffered wage during a given period, CIS will first examine 
whether the petitioner employed and paid the beneficiary during that period. If the petitioner establishes by 
documentary evidence that it employed the beneficiary at a salary equal to or greater than the proffered wage, 
the evidence will be considered prima facie proof of the petitioner's ability to pay the proffered wage. In the 
instant case, the petitioner did not submit the beneficiary's W-2 or 1099 forms, nor did the beneficiary claim 
to have worked for the petitioner. In response to the director's request for evidence (RFE) dated July 29, 
2005, counsel confirmed that the beneficiary was not employed by the petitioner in the years 2001-2004. 
Thus, the petitioner failed to establish its ability to pay the proffered wage through wages paid to the 
1 
 An 1-140 petition for a substituted beneficiary retains the same priority date as the original ETA 750. 
Memo. from Luis G. Crocetti, Associate Commissioner, Immigration and Naturalization Service, to Regional 
Directors, et al., Substitution of Labor Certification Beneficiaries, at 3, http://owsdoleta.gov/dmstree/fm/fm96 
/fm 28-96a.pdf (March 7, 1996). 
The submission of additional evidence on appeal is allowed by the instructions to the Form I-290B, which 
are incorporated into the regulations by the regulation at 8 C.F.R. 5 103.2(a)(l) and the record in the instant 
case provides no reason to preclude consideration of any of the documents newly submitted on appeal, See 
Matter of Soriano, 19 I&N Dec. 764 (BIA 1988). 
Page 4 
beneficiary from 2001 onwards. On appeal, counsel argues that $19,680 in paid wages together with net 
profit, shareholder distribution, cash at hand and retained earnings in 2001 established the petitioner's ability 
to pay the proffered wage. However, counsel does not advise that the beneficiary will replace any workers. The 
record does not name these workers, state their wages, verify their full-time employment performing duties of the 
proffered position, or provide evidence that the petitioner has replaced or will replace them with the beneficiary. 
In general, wages already paid to others are not available to prove the ability to pay the wage proffered to the 
beneficiary at the priority date of the petition and continuing to the present. The petitioner is still obligated to 
demonstrate that it could pay the full proffered wage of $20,800 in 2001 onwards with its net income or net 
current assets. 
If the petitioner does not establish that it employed and paid the beneficiary an amount at least equal to the 
proffered wage during that period, CIS will next examine the net income figure reflected on the petitioner's 
federal income tax return, without consideration of depreciation or other expenses. Reliance on federal 
income tax returns as a basis for determining a petitioner's ability to pay the proffered wage is well 
established by judicial precedent. Elatos Restaurant Corp. v. Sava, 632 F. Supp. 1049, 1054 (S.D.N.Y. 1986) 
(citing Tongatapu Woodcraft Hawaii, Ltd. v. Feldman, 736 F.2d 1305 (9th Cir. 1984)); see also Chi-Feng 
Chang v. Thornburgh, 719 F. Supp. 532 (N.D. Texas 1989); K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. 1080 
(S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. Supp. 647 (N.D. Ill. 1982), aff'd, 703 F.2d 571 (7th Cir. 1983). 
Reliance on its gross income and gross profit is misplaced. Showing that the petitioner's total income 
exceeded the proffered wage is insufficient. Similarly, showing that the petitioner paid wages in excess of the 
proffered wage is insufficient. 
In K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. at 1084, the court held that the Immigration and Naturalization 
Service, now CIS, had properly relied on the petitioner's net income figure, as stated on the petitioner's 
corporate income tax returns, rather than the petitioner's gross income. Reliance on the petitioner's 
depreciation in determining its ability to pay the proffered wage is misplaced. The court in K. C.P. Food Co., 
Inc. v. Sava specifically rejected the argument that the Service should have considered income before 
expenses were paid rather than net income. The court in Chi-Feng Chang further noted: 
Plaintiffs also contend the depreciation amounts on the 1985 and 1986 returns are non-cash 
deductions. Plaintiffs thus request that the court sua sponte add back to net cash the 
depreciation expense charged for the year. Plaintiffs cite no legal authority for this 
proposition. This argument has likewise been presented before and rejected. See Elatos, 632 
F. Supp. at 1054. [CIS] and judicial precedent support the use of tax returns and the net 
income Jigures in determining petitioner's ability to pay. Plaintiffs' argument that these 
figures should be revised by the court by adding back depreciation is without support. 
(Emphasis in original.) Chi-Feng at 537. 
The record contains copies of the petitioner's Form 1 120s U.S. Income Tax Return for an S Corporation for 2001 
through 2003. The petitioner's tax returns in the record show that the petitioner is structured as an S 
corporation and that the petitioner's fiscal year runs based on a calendar year. The petitioner's tax returns for 
2001 through 2003 demonstrate the following financial information concerning the petitioner's ability to pay 
the proffered wage of $20,800 per year from the priority date in 2001 : 
In 200 1, the Form 1 120s stated a net income3 of $16,6 13. 
3 
Where an S corporation's income is exclusively from a trade or business, CIS considers net income to be the 
In 2002, the Form 1 120s stated a net income of $24,185. 
In 2003, the Form 1 120s stated a net income of $27,190. 
Therefore, for the years 2002 and 2003, the petitioner had sufficient net income to pay the proffered wage, but 
for 2001, the petitioner did not have sufficient net income to pay the beneficiary the proffered wage. 
If the net income the petitioner demonstrates it had available during that period, if any, added to the wages 
paid to the beneficiary during the period, if any, do not equal the amount of the proffered wage or more, CIS 
will review the petitioner's assets. The petitioner's total assets include depreciable assets that the petitioner 
uses in its business. Those depreciable assets will not be converted to cash during the ordinary course of 
business and will not, therefore, become funds available to pay the proffered wage. Further, the petitioner's 
total assets must be balanced by the petitioner's liabilities. Otherwise, they cannot properly be considered in 
the determination of the petitioner's ability to pay the proffered wage. Rather, CIS will consider net current 
assets as an alternative method of demonstrating the ability to pay the proffered wage. On appeal, counsel 
asserts that the petitioner's total assets without balanced by the petitioner's liability established the 
petitioner's ability to pay. Counsel's reliance on the petitioner's total assets to establish its ability to pay is 
misplaced. 
Net current assets are the difference between the petitioner's current assets and current liabilitie~.~ A 
corporation's year-end current assets are shown on Schedule L, lines 1 through 6. Its year-end current 
liabilities are shown on lines 16 through 18. If the total of a corporation's end-of-year net current assets and 
the wages paid to the beneficiary (if any) are equal to or greater than the proffered wage, the petitioner is 
expected to be able to pay the proffered wage using those net current assets. 
The petitioner's net current assets during 2001 were $(79,693). 
Therefore, for the year 2001, the petitioner did not have sufficient net current assets to pay the proffered 
wage. 
Therefore, from the date the Form ETA 750 was accepted for processing by the U. S. Department of Labor, 
the petitioner had not established that it had the ability to pay the beneficiary the proffered wage as of the 
priority date in 2001 through an examination of wages paid to the beneficiary, or its net income; or its net 
current assets. 
figure for ordinary income, shown on line 21 of page one of the petitioner's Form 1120s. The instructions on 
the Form 1120s U.S. Income Tax Return for an S Corporation state on page one, "Caution: Include only trade 
or business income and expenses on lines la through 2 1 ." 
Where an S corporation has income from sources other than fiom a trade or business, net income is found on 
Schedule K. The Schedule K form related to the Form 1120s states that an S corporation's total income from 
its various sources are to be shown not on page one of the Form 1120S, but on lines 1 through 6 of the 
Schedule K, Shareholders' Shares of Income, Credits, Deductions, etc. 
 See Internal Revenue Service, 
Instructions for Form 1120s (2003), available at http://www.irs.gov/pub/irs-prior/i1120s--2003.pdf; 
Instructions for Form 1 120s (2002), available at http://www.irs.gov/pub/irs-prior/i1120s--2002.pdf. 
4 
According to Barron S Dictionary of Accounting Terms 117 (3rd ed. 2000), "current assets" consist of items 
having (in most cases) a life of one year or less, such as cash, marketable securities, inventory and prepaid 
expenses. "Current liabilities" are obligations payable (in most cases) within one year, such accounts 
payable, short-term notes payable, and accrued expenses (such as taxes and salaries). Id. at 1 18. 
Counsel asserts in his brief accompanying the appeal that there is another way to determine the petitioner's 
continuing ability to pay the proffered wage from the priority date. On appeal counsel submits a letter dated 
March 17, 2006 from the petitioner's accountant asserting that "according to Line 7 of Schedule M-2 on Page 
4 of the Form 1120s U.S. Income Tax Return for an S Corporation, the officer and sole shareholder of the 
corporation took a cash distribution at the end of December 2001 in the amount of $57,308. This amount, if 
reinvested into the corporation or not taken in future years in addition to the cash assets in the bank, should be 
enough liquid cash to employ and pay the agreed upon salary of the above reference individual." Neither 
counsel or the accountant submitted any evidence to support the assertion. The assertions of counsel do not 
constitute evidence. Matter of Obaigbena, 19 I&N Dec. 533, 534 (BIA 1988); Matter of Ramirez-Sanchez, 
17 I&N Dec. 503, 506 (BIA 1980). Going on record without supporting documentary evidence is not 
sufficient for purposes of meeting the burden of proof in these proceedings. Matter of Sofici, 22 I&N Dec. 
158, 165 (Cornrn. 1998) (citing Matter of Treasure Craft of California, 14 I&N Dec. 190 (Reg. Comm. 
1972)). 
The sole shareholder of a corporation has the authority to allocate expenses of the corporation for various 
legitimate business purposes, including for the purpose of reducing the corporation's taxable income. 
Compensation of officers is an expense category explicitly stated on the Form 1120s U.S. Corporation 
Income Tax Return. For this reason, the petitioner's figures for compensation of officers may be considered 
as additional financial resources of the petitioner, in addition to its figures for ordinary income. In the present 
case, however, contrary to counsel's assertion, the record does not contain any evidence to prove that the 
amount of $57,308 was paid to the sole shareholder of the petitioner. Line 7 of the petitioner's tax return for 
200 1 reflects that the petitioner did not pay any amount of officer's compensation in 200 1. 
The petitioner's Schedule M-2 for 2001 in fact reflects the petitioner's change of retained earnings in 2001. 
The line of Schedule M-2 reflects the petitioner's retained earnings at the beginning of the year 2001, Line 8 
reflects the retained earnings at the end of the year 2001, and lines 2 to 7 indicate the balance changes during 
the year. On appeal, counsel recommends the use of retained earnings of $45,755 in 2001 to pay the 
proffered wage. Retained earnings are the total of a company's net earnings since its inception, minus any 
payments to its stockholders. That is, this year's retained earnings are last year's retained earnings plus this 
year's net income. Adding retained earnings to net income and/or net current assets is therefore duplicative. 
Therefore, CIS looks at each particular year's net income, rather than the cumulative total of the previous 
years' net incomes represented by the line item of retained earnings. 
Further, even if considered separately from net income and net current assets, retained earnings might not be 
included appropriately in the calculation of the petitioner's continuing ability to pay the proffered wage 
because retained earnings do not necessarily represent funds available for use. Retained earnings can be 
either appropriated or unappropriated. Appropriated retained earnings are set aside for specific uses, such as 
reinvestment or asset acquisition, and as such, are not available for shareholder dividends or other uses. 
Unappropriated retained earnings may represent cash or non-cash and current or non-current assets. The 
record does not demonstrate that the petitioner's retained earnings are unappropriated and are cash or current 
assets that would be available to pay the proffered wage. 
Counsel also suggests that the petitioner's net income can be added to its net current assets to show the total 
amount of funds available to pay the wage. It is clear that counsel wants to combine the petitioner's taxable 
income with the cash also received by the business for that year as part of the Schedule "L" current assets. 
CIS will consider separately, but not in combination, the taxable income and the net current assets of a 
business to determine the ability of a petitioner to pay the proffered wage on the priority date. Counsel's 
method would duplicate revenues received by the business during the year. 
Counsel's assertions on appeal cannot be concluded to outweigh the evidence presented in the tax returns as 
submitted by the petitioner that demonstrates that the petitioner could not pay the proffered wage in 2001, the 
. 
year of the priority date. Counsel's assertions and evidence submitted on appeal cannot overcome the ground 
of denial, and therefore, the decisions of the director dated October 7, 2005 and February 23, 2006 are 
affirmed. 
Additionally, the record before the director closed on September 6, 2005 with the receipt by the director of the 
petitioner's submissions in response to the RFE. As of that date the petitioner's federal tax return for 2004 should 
have been available. However, the petitioner did not submit its 2004 tax return, nor did counsel explain why the 
tax return was not submitted. In visa petition proceedings, the burden is on the petitioner to establish eligibility 
for the benefit sought. See Matter of Brantigan, 11 I&N Dec. 493 (BIA 1966). The petitioner must prove by 
a preponderance of evidence that the beneficiary is fully qualified for the benefit sought. Matter of Martinez, 
2 1 I&N Dec. 1035, 1036 (BIA 1997); Matter of Patel, 19 I&N Dec. 774 (BIA 1988); Matter of Soo Hoo, 1 1 
I&N Dec. 151 (BIA 1965). The regulation at 8 C.F.R. 5 204.5(g)(2) states that the director may request 
additional evidence in appropriate cases. Although specifically and clearly requested by the director, the 
petitioner declined to provide copies of its tax return for 2004. The tax returns would have demonstrated the 
amount of taxable income the petitioner reported to the IRS and further reveal its continuing ability to pay the 
proffered wage. The petitioner's failure to submit these documents cannot be excused. The failure to submit 
requested evidence that precludes a material line of inquiry shall be grounds for denying the petition. See 8 
C.F.R. 4 103.2(b)(14). 
Beyond the director's decisions and counsel's assertions on appeal, the AAO has identified additional 
grounds of ineligibility and will discuss these issues. 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, 299 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). 
The AAO will discuss whether the petitioner demonstrated that the beneficiary possessed the qualifying 
experience prior to the priority date. The petitioner must demonstrate that, on the priority date, the beneficiary 
had the qualifications stated on its Form ETA 750 Application for Alien Employment Certification as certified by 
the U.S. Department of Labor. Matter of Wing's Tea House, 16 I&N Dec. 158 (Act. Reg. Comm. 1977). 
CIS must look to the job offer portion of the labor certification to determine the required qualifications for the 
position. CIS may not ignore a term of the labor certification, nor may it impose additional requirements. See 
Matter of Silver Dragon Chinese Restaurant, 19 I&N Dec. 401, 406 (Comm. 1986). See also, Mandany v. 
Smith, 696 F.2d 1008, (D.C. Cir. 1983); K.R.K. Iwine, Inc. v. Landon, 699 F.2d 1006 (9th Cir. 1983); Stewart 
Infra-Red Commissary of Massachusetts, Inc. v. Coomey, 661 F.2d 1 (1st Cir. 1981). 
The certified Form ETA 750 in the instant case states that the position of retail store manager (assistant 
manger) requires two (2) years of experience in the job offered, experience in Wizard and MS Word computer 
software and experience in handling Halal meats and Halal products. 
The regulation at 8 C.F.R. 4 204.5(g)(l) states in pertinent part: 
Evidence relating to qualifying experience or training shall be in the form of letter(s) from 
current or former employer(s) or trainer(s) and shall include the name, address, and title of the 
writer, and a specific description of the duties performed by the alien or of the training received. 
If such evidence is unavailable, other documentation relating to the alien' s experience or training 
will be considered. 
On the Form ETA 750B, the beneficiary set forth her work experience as an "Assistant Manager" with Khalis 
Food, a wholesale business, from March 1997 to May 2000, assisting the manager in plans and preparing 
work schedules and assigning employees to specific duties. The record contains an experience letter from the 
beneficiary's former employer verifying that the beneficiary possessed the qualifications as re uired by the 
Form ETA 750. The experience letter was dated April 19, 2005, signed by q as the 
ownerlproprietor and is on letterhead of Khalis Foods Zaxco International. The author certifies that the 
beneficiary was employed as a full-time (working 9am to 6pm, 6 days a week) assistant manager for a period 
of 3 years from March 1997 to March 2000. The letter also includes a description of the duties as follows: 
"[alssisted manger engaged in plans and prepared work schedules and assigned employees specific duties. 
Formulated pricing policies. Prepared displays, maintained inventory, reconciliation of cash with sales 
receipts, kept operating records. Preparation of order for suppliers." While it is doubtful whether or not the 
experience as an assistant manager in a wholesale business in Pakistan qualifies as the required experience in 
the job as a retail store manager in a convenience store in the United State, the letter does not verify that the 
beneficiary had experience in Wizard and MS Word computer software and ex erience in handling Halal 
meats and Halal products. Therefore, the experience letter from of Khalis Foods Zaxco 
International cannot be considered as primary evidence to establish the beneficiary's qualifications for the 
proffered position in the instant case. The petitioner failed to demonstrate that the beneficiary possessed the 
requisite experience prior to the priority date, and thus is not qualified for the proffered position. 
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. €j 1361. Here, that burden has 
not been met. 
ORDER: The appeal is dismissed.