dismissed L-1A Case: Beer Distribution

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PUBLIC COpy
U.S. Department of Homeland Security
20 Massachusetts Ave., N.W., Rm. A3000
Washington, DC 20529
u.s.Citizenship
and Immigration
Services
File: WAC 06 008 52438 Office: CALIFORNIA SERVICE CENTER Date: JUN 05 2007
IN RE: Petitioner:
Beneficiary:
Petition: Petition for a Nonimmigrant Worker Pursuant to Section 101(a)(l5)(L) of the Immigration
and Nationality Act, 8 U.S.c. § 1101(a)(l5)(L)
IN 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.
~:~~~f
Administrative Appeals Office
www.uscis.gov
WAC 06008 52438
Page 2
DISCUSSION: The Director, California Service Center, denied the petition for a nonimmigrant visa. The
matter is now before the Administrative Appeals Office (AAO) on appeal. The AAO will dismiss the appeal.
The petitioner filed this nonimmigrant visa petition seeking to employ the beneficiary as a regional
distribution manager as an L-1A nonimmigrant intracompany transferee pursuant to section 101(a)(15)(L) of
the Immigration and Nationality Act (the Act), 8 U.S.C. § 1101(a)(15)(L). The petitioner is a limited liability
company organized under the laws of the State of Texas and is allegedly a beer importer and distributor.
The director denied the petition concluding that the petitioner did not establish that it and the foreign
employer have a qualifying relationship.
The petitioner subsequently filed an appeal. The director declined to treat the appeal as a motion and
forwarded the appeal to the AAO for review. On appeal, counsel to the petitioner asserts that the director
erred and that the petitioner established that it has a qualifying relationship with the beneficiary's foreign
employer. In support, counsel submits a brief and additional evidence.
To establish eligibility for the L-l nonimmigrant visa classification, the petitioner must meet the criteria
outlined in section 101(a)(15)(L) of the Act. Specifically, a qualifying organization must have employed the
beneficiary in a qualifying managerial or executive capacity, or in a specialized knowledge capacity, for one
continuous year within three years preceding the beneficiary's application for admission into the United
States. In addition, the beneficiary must seek to enter the United States temporarily to continue rendering his
or her services to the same employer or a subsidiary or affiliate thereof in a managerial, executive, or
specialized knowledge capacity.
The regulation at 8 C.F.R. § 214.2(1)(3) states that an individual petition filed on Form 1-129 shall be
accompanied by:
(i) Evidence that the petitioner and the organization which employed or will employ the
alien are qualifying organizations as defined in paragraph (l)(1)(ii)(G) of this section.
(ii) Evidence that the alien will be employed in an executive, managerial, or specialized
knowledge capacity, including a detailed description of the services to be performed.
(iii) Evidence that the alien has at least one continuous year of full time employment
abroad with a qualifying organization within the three years preceding the filing of
the petition.
(iv) Evidence that the alien's prior year of employment abroad was in a position that was
managerial, executive or involved specialized knowledge and that the alien's prior
education, training, and employment qualifies him/her to perform the intended
services in the United States; however, the work in the United States need not be the
same work which the alien performed abroad.
The primary issue in the present matter is whether the petitioner has established that it has a qualifying
WAC 06 008 52438
Page 3
relationship with the beneficiary's foreign employer as required by 8 C.F.R. § 214.2(1)(3)(i).
Title 8 C.F.R. § 214.2(i)(l)(ii)(G) defines a "qualifying organization" as a firm, corporation, or other legal
entity which "meets exactly one of the qualifying relationships specified in the definitions of a parent, branch,
affiliate or subsidiary specified in paragraph (l)(l)(ii) of this section" and "is or will be doing business." An
"affiliate" is defined in pertinent part as "[o]ne of two subsidiaries both of which are owned and controlled by the
same parent or individual."
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, 595 (Comm. 1988);
see also Matter of Siemens Medical Systems, Inc., 19 I&N Dec. 362 (BIA 1986); Matter ofHughes , 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.
In this matter, the petitioner, a Texas limited liability company, asserts that it is an "affiliate" of the beneficiary's
foreign employer, Cerveceria Cuauhtemoc Moctezuma, S.A. de C.V. ("CCM"). The petitioner asserts that both
ofthese entities are owned and controlled by FEMSA Cerveza, S.A. de C.V. ("FEMSA Cerveza") which, in tum,
is owned and controlled by Fomento Economico Mexicano, S.A. de C.V. ("FEMSA"). In support of this
assertion, the petitioner submitted a copy of FEMSA's 2004 annual report which identifies FEMSA Cerveza and
CCM as subsidiaries, although FEMSA's ownership interest in CCM is not specifically described. The petitioner
also submitted a copy of the petitioner's 2000 certificate of organization evidencing its formation as a limited
liability company under the laws of the State of Texas and a copy of the petitioner's "Amended and Restated
Regulations" dated December 31, 2004. Section 3.1 of the Amended and Restated Regulations identifies FEMSA
Cerveza as the sole "initial member" of the petitioner.
On October 21, 2005, the director requested additional evidence. The director requested, inter alia, further
evidence establishing that the petitioner has a qualifying relationship with the beneficiary's foreign employer. In
response, the petitioner referred the director to the evidence submitted with the initial petition, e.g., the annual
report and the petitioner's Amended and Restated Regulations.
On December 5, 2005, the director denied the petition. The director concluded that the petitioner did not
establish that it and the beneficiary's foreign employer have a qualifying relationship. The director based his
denial on the annual report's failure to list the petitioner as a subsidiary or affiliate of FEMSA and the
apparent license relationship between the petitioner and Heineken USA, Inc.
On appeal, counsel asserts that the record establishes the requisite qualifying relationship. Counsel argues
that the petitioner' relationship with Heineken USA, Inc. is immaterial and does not alter the petitioner's
qualifying relationship with the beneficiary's foreign employer. Counsel further argues that Section 3.1 of the
petitioner's Amended and Restated Regulations and the 2004 annual report sufficiently establish that the two
entities have a qualifying relationship as affiliates. Finally, counsel provided a "secretary's certificate"
purporting to confirm that the petitioner's sole owner is FEMSA Cerveza.
WAC 06 008 52438
Page 4
Upon review, the petitioner's assertions are not persuasive in establishing that it has a qualifying relationship
with the beneficiary's foreign employer.
As explained above, the petitioner is a limited liability company organized under the laws of the State of
Texas in 2000. As counsel correctly observes, limited liability companies do not generally issue share
certificates like corporations. However, in this matter, the petitioner has failed to provide sufficient evidence
establishing the ownership and control of the United States entity under the laws of the state of organization.
Texas limited liability companies formed in 2000 are regulated by the Texas Limited Liability Company Act.
Tex. Rev. Civ. Stat. Ann. Art. 1528n. 1 This law provides guidance on how to interpret the articles of
organization and adopted regulations of a Texas limited liability company as these relate to ownership
interests, and how a Texas limited liability company can evidence ownership of interests by members.
Sections 3.02 and 4.01 permit a person to become a member of a limited liability company upon formation
and to be identified as an "initial member" in the articles of organization. Tex. Rev. Civ. Stat. Ann. Art.
1528n, §§ 3.02 and 4.01. Section 4.01 also permits members to be added after formation of the limited
liability company. Id. Furthermore, section 2.22 requires Texas limited liability companies to maintain
records including, but not limited to, a list identifying each member by name, address, and percentage of
ownership; a written statement of the contributions made by each member, the times at which additional
contributions are to be made, events requiring the dissolution of the limited liability company, and the date on
which each member became a member; and copies of the regulations of the limited liability company, if any.
Tex. Rev. Civ. Stat. Ann. Art. 1528n, § 2.22.
In this matter, the only evidence submitted by the petitioner in its attempt to establish its ownership and control
was a copy of its Amended and Restated Regulations dated December 31, 2004 which identify FEMSA
Cerveza as the sole "initial" member. The record is devoid of any evidence establishing the identity of the
current members of the petitioner even though Texas law mandates the creation and maintenance of such
documentation. See id. Moreover, the "secretary's certificate" submitted on appeal also fails to establish the
petitioner's ownership and control. Not only does this certificate fail to comply with Texas law, it purports to
attest to the ownership and control of a Texas corporation and not of a Texas limited liability company. The
petitioner makes no attempt to explain this fundamental inconsistency in the record. It is incumbent upon the
petitioner to resolve any inconsistencies in the record by independent objective evidence. Any attempt to
explain or reconcile such inconsistencies will not suffice unless the petitioner submits competent objective
evidence pointing to where the truth lies. Matter of Ho, 19 I&N Dec. 582, 591-92 (BIA 1988). Finally, the
annual report fails to specifically described FEMSA Cerveza's ownership interest in CCM thus casting doubt
on the petitioner's claim that it is an affiliate of CCM.
IWhile the Texas Limited Liability Company Act was substantially amended in 2005, and was made effective
in 2006, these revisions do not generally affect limited liability companies formed in 2000, such as the
petitioner. The petitioner, therefore, is still regulated by the Act as it appeared in 2000. Tex. Bus. Org. Code
Ann. Chapter 101.
WAC 06 00852438
Page 5
Accordingly, as the petitioner has failed to provide any evidence of its current ownership and control, the
petition may not be approved?
Beyond the decision of the director, as the petitioner has also failed to establish that the foreign entity is currently
"doing business" as defined by the regulations, the petitioner has failed to establish that it has a qualifying
relationship with the beneficiary's foreign employer for this additional reason.
On October 21,2005, the director requested additional evidence regarding the current business operations of the
beneficiary's foreign employer. Specifically, the director requested photographs of the foreign employer's
business premises, merchandise, products, and employees. The director also requested addresses, directions, and
telephone numbers for each of the foreign employer's facilities.
In response, however, the petitioner stated the following on page 3 of the letter dated November 21, 2005:
As its annual report thoroughly details, FEMSA is a multi-billion-dollar company that does
business globally. The USCIS's request for photographs of FEMSA's operations therefore is
superfluous.
In view of the petitioner's refusal to comply with the director's request for evidence, the petition must also be
denied because the petitioner's failure to provide this evidence precluded a material line in inquiry into the current
business operations of the foreign employer. As explained in 8 C.F.R. § 103.2(b)(8), a petitioner's refusal to
provide the requested evidence amounts to a request for a decision on the record. However, failure to submit
requested evidence that precludes a material line of inquiry shall be grounds for denying the petition. 8 C.F .R.
§ 103.2(b)(l4). The director's request for photographic evidence confirming the existence and current
operations of the beneficiary's foreign employer, Cerveceria Cuauhtemoc Moctezuma, S.A. de C.V., is entirely
appropriate in this case. See 8 C.F.R. § 214.2(1)(3)(viii). FEMSA's 2004 annual report, which happens to list the
beneficiary's employer as a subsidiary of FEMSA Cerveza, does not establish that this subsidiary is currently
engaged in the regular, systematic, and continuous provision of a good or service. As this is an essential element
of establishing the existence of a qualifying relationship, and the petitioner has failed to carry its burden of proof,
the petition may not be approved for this additional reason.
Beyond the decision of the director, the petitioner has failed to establish that the beneficiary will be employed in
the United States in a managerial or executive capacity.
ZIt is noted that the director also concluded in his decision that the petitioner failed to establish that is has a
qualifying relationship with the beneficiary's foreign employer because (1) the 2004 annual report for FEMSA
fails to list the petitioner as a subsidiary or affiliate; and (2) the petitioner has a license agreement with
Heineken USA, Inc. Upon review, the AAO will withdraw these determinations even though it will dismiss
the appeal for the reasons set forth above. The petitioner's absence from the annual report is of no
consequence since the report identifies both FEMSA Cerveza and CCM as subsidiaries and implies that there
may be additional subsidiaries which are unnamed in the report; however, as explained above, the annual
report does not reveal the magnitude of FEMSA's, or FEMSA Ceveza's, ownership interest in CCM.
Moreover, upon review of the license agreement, the petitioner's relationship with Heineken USA, Inc. does
not appear to affect the petitioner's ownership and control. It is therefore irrelevant to these proceedings.
WAC 06 008 52438
Page 6
Section lOl(a)(44)(A) of the Act, 8 U.S.c. § llOI(a)(44)(A), defines the term "managerial capacity" as an
assignment within an organization in which the employee primarily:
(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. § 1101(a)(44)(B), defines the term "executive capacity" as 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.
While the petitioner is claiming that the beneficiary will be employed in a managerial capacity, it does not
clearly state that it is not alternatively seeking to classify the beneficiary as an executive. Therefore, the AAO
will consider the petition as one seeking to classify the beneficiary as a manager or, in the alternative, as an
executive and will consider both classifications.
The petitioner described the beneficiary's proposed job duties in letters dated October 6, 2005 and November
21, 2005. As these job descriptions are clearly delineated in the record, the descriptions will not be
reproduced here. Generally, the beneficiary is described in both the letters and in an attached organizational
chart as having no supervisory responsibilities over other employees as he will be the petitioner's only
employee in California. Rather, the beneficiary is described as "managing local markets, safeguarding equity
of [the foreign entity's] brands, and implementing the annual marketing plan for the region." More
WAC 06 008 52438
Page 7
specifically, the beneficiary is described as developing and managing the annual marketing plan; providing
market information; managing spending; guiding and directing the marketing budget; making sales calls;
communicating with wholesalers; training; engaging in market research; and supporting and complimenting
advertising and promotional activities.
Upon review, the petitioner's description of the beneficiary's job duties has failed to establish that the
beneficiary will act in a "managerial" capacity. A majority of the duties ascribed to the beneficiary appear to
be non-qualifying administrative or operational tasks which do not rise to the level of being managerial or
executive in nature. Marketing and sales duties are not managerial in nature when the tasks inherent to these
duties are performed by the beneficiary. As the record is devoid of any evidence that subordinate employees
will relieve the beneficiary, the petitioner's only employee in California, of the need to perform these non­
qualifying tasks, it must be concluded that he will perform these tasks. 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) ofthe Act (requiring that
one "primarily" perform the enumerated managerial or executive duties); see also Matter of Church
Scientology International, 19 I&N Dec. at 604.
The petitioner has also failed to establish that the beneficiary will supervise and control the work of other
supervisory, managerial, or professional employees, or that he will manage an essential function of the
organization. As explained above, the beneficiary has been ascribed no supervisory or managerial authority
over other employees. He will be the petitioner's only employee in California. Therefore, he is clearly not
supervising other supervisory, managerial, or professional employees.
Moreover, the record does not establish that the beneficiary will manage an essential function of the
organization. The term "function manager" applies generally when a beneficiary does not supervise or
control the work of a subordinate staff but instead is primarily responsible for managing an "essential
function" within the organization. See section 101(a)(44)(A)(ii) of the Act. The term "essential function" is
not defined by statute or regulation. 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 in
managing the essential function, 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. See 8 C.F.R. § 214.2(l)(3)(ii). In addition, the petitioner's description of the beneficiary's daily
duties must demonstrate that the beneficiary manages the function rather than performs the duties related to
the function. In this matter, the petitioner has not provided evidence that the beneficiary will manage an
essential function because, as explained above, it appears that the beneficiary will perform the tasks related to
the function rather than manage the function.
Similarly, the petitioner has failed to establish that the beneficiary will act in an "executive" capacity. The
statutory definition of the term "executive capacity" focuses on a person's elevated position within a complex
organizational hierarchy, including major components or functions of the organization, and that person's
authority to direct the organization. Section 101(a)(44)(B) of the Act. Under the statute, a beneficiary must
have the ability to "direct the management" and "establish the goals and policies" of that organization.
Inherent to the definition, the organization must have a subordinate level of employees for the beneficiary to
direct, and the beneficiary must primarily focus on the broad goals and policies of the organization rather than
WAC 06 008 52438
Page 8
the day-to-day operations of the enterprise. An individual will not be deemed an executive under the statute
simply because they have an executive title or because they "direct" the enterprise as the owner or sole
managerial employee. The beneficiary must also exercise "wide latitude in discretionary decision making"
and receive only "general supervision or direction from higher level executives, the board of directors, or
stockholders of the organization." !d. For the same reasons indicated above, the petitioner has failed to
establish that the beneficiary will be acting primarily in an executive capacity. As explained, it appears that
the beneficiary will perform the tasks necessary to produce a product or to provide a service. Therefore, the
petitioner has not established that the beneficiary will be employed primarily in an executive capacity.
It is appropriate for Citizenship and Immigration Services (CIS) to consider the size of the petitioning
company in conjunction with other relevant factors, such as a company's small personnel size, the absence of
employees who would perform the non-managerial or non-executive operations of the company, or a "shell
company" that does not conduct business in a regular and continuous manner. See, e.g., Systronics Corp. v.
INS, 153 F. Supp. 2d 7, 15 (D.D.C. 2001).
Accordingly, in this matter, the petitioner has failed to establish that the beneficiary will be primarily
performing managerial or executive duties, and the petition may not be approved for that additional reason.
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), affd, 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 petition will be denied for the above stated reasons, with each considered as an independent and
alternative basis for denial. When the AAO denies a petition on multiple alternative grounds, a plaintiff can
succeed on a challenge only if it is shown that the AAO abused its discretion with respect to all of the AAO's
enumerated grounds. See Spencer Enterprises, Inc., 229 F. Supp. 2d at 1043.
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. § 1361. Here, that burden has not been met. Accordingly, the
appeal will be dismissed.
ORDER: The appeal is dismissed.