dismissed L-1A Case: Food Import/Wholesale

U.S. Citizenship 
and Immigration 
Services 
MATTER OF T-T- LLC 
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: MAR.16,2017 
APPEAL OF CALIFORNIA SERVICE CENTER DECISION 
PETITION: FORM I-129, PETITION FOR A NONIMMIGRANT WORKER 
The Petitioner, an importer and wholesaler of organic and gourmet foods, seeks to temporarily 
employ. the Beneficiary as chief executive officer (CEO) of its new office under the L-1 A 
nonimmigrant classification for intracompany transferees. See Immigration and Nationality Act (the 
Act) section 10l(a)(15)(L), 8 U.S.C. § 110l(a)(15)(L). The L-lA classification allows a corporation 
or other legal entity (including its affiliate or subsidiary) to transfer a qualifying foreign employee to the 
United States to work temporarily in a managerial or executive capacity. 
The Director, California Service Center, denied the petition. The Director concluded that the 
evidence of record did not establish: ( 1) that the Petitioner will employ the Beneficiary in a 
managerial or executive capacity within one year of approval of the petition; and (2) the size of the 
U.S. investment and the foreign entity's ability to remunerate the Beneficiary and to commence doing 
business in the United States. 
The matter is now before us on appeal. In its appeal, the Petitioner assetis that it has met its burden 
of proof and that the Director erred by not giving full consideration to the information provided 
previously. 1 
Upon de novo review, we will dismiss the appeal. 
I. LEGAL FRAMEWORK 
To establish eligibility for the L-1 nonimmigrant visa classification, a qualifying organization must 
have employed the beneficiary in a 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 services to the same employer or a subsidiary or affiliate thereof in 
a managerial, executive, or specialized knowledge capacity. Section 101 (a)(15)(L) of the Act. 
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The Petitioner also asserts that it has secured sufficient physical premises to operate the new office, but the Director did 
not cite that ground as a basis for denial. (The Director did mention the issue in the context of information requested 
prior to the denial.) 
Matter ofT- T- LLC 
The term "new office" refers to an organization which has been doing business in the United States 
for less than one year. 8 C.F.R. § 214.2(1)(1)(ii)(F). If the Form 1-129, Petition for a Nonimmigrant 
Worker, indicates that the Beneficiary is coming to the United States in L-lA status to open or to be 
employed in a new office, the Petitioner must submit evidence to demonstrate that the new office 
will be able to support a managerial or executive position within one year. See 8 C.F.R. 
§ 214.2(1)(3)(v). 
II. NEW OFFICE 
Both of the Director's grounds for denial relate to the Petitioner's status as a new office. To 
establish that the new office, within one year of the approval of the petition, will support a 
managerial or executive position, the Petitioner must submit information regarding the proposed 
nature of the office describing the scope of the entity, its organizational structure, and its financial 
goals; the size of the United States investment and the financial ability of the foreign entity to 
remunerate the beneficiary and to commence doing business in the United States; and the 
organizational structure ofthe foreign entity. 8 C.F.R. § 214.2(l)(3)(v)(C). 
The new office regulations recognize that a designated manager or executive responsible for setting 
up operations will be engaged in a variety of low-level activities not normally performed by 
employees at the executive or managerial level and that often the full range of managerial 
responsibility cannot be performed in that first year. The Petitioner's evidence in support of a new 
office petition should demonstrate a realistic exp~ctation that the enterprise is prepared to commence 
business operations and rap,idly expand as it moves away from the developmental stage to full 
operations, where there would be an actual need for a manager or executive who will primarily 
perform qualifying duties. 
A. Executive Capacity Within One Year 
The Director found that the Petitioner has not shown that its intended organizational structure will 
permit the Beneficiary to work in a primarily executive capacity within a year of approval of the 
petition. The Petitioner does not claim that it will employ the Beneficiary in a managerial capacity. 
Therefore, we restrict our analysis to whether the Petitioner will employ the Beneficiary in an 
executive capacity. 
Section 101(a)(44)(B) of the Act 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 
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Matter ofT- T- LLC 
(iv) receives only general supervision or direction from higher-level executives, the 
board of directors, or stockholders of the organization. 
1. Duties 
When examining the managerial or executive capacity of the Beneficiary, we will look first to the 
Petitioner's description of the job duties. The Petitioner's description of the job duties must clearly 
describe the duties to be performed by the Beneficiary and indicate whether such duties are in a 
managerial or executive capacity. See 8 C.F.R. § 214.2(1)(3)(ii). 
The Petitioner must show that the Beneficiary will perform certain high-level responsibilities. 
Champion World, Inc. v. INS, 940 F.2d 1533 (9th Cir. 1991) (unpublished table decision). In 
addition, the Petitioner must prove that the Beneficiary will be primarily engaged in executive 
duties, as opposed to ordinary operational activities alongside the Petitioner's other employees. See 
Family Inc. v. USCIS, 469 F.3d 1313, 1316 (9th Cir. 2006); Champion World, 940 F.2d 1533. As 
the Petitioner filed as a new office, its evidence should establish that the Beneficiary would perform 
primarily executive duties within one year. 
The Petitioner filed Form I-129 on April 21, 2016. At the time of filing, the Petitioner claimed to 
have one employee. In a letter submitted with the petition, the Beneficiary described the petitioning 
company: 
[The petitioning company] was formed ... to import fruits from South America to the 
U.S. in the off-season and import olive oil, coffee, cacao and cacao products from 
Peru and Chile year-round .... [The Petitioner's] clients are distributors for specialty 
chains that focus on organic and fair trade products ... and major retailers .... [The 
Petitioner] has projected approximately $500,000 to $600,000 in sales for 2016. The 
company currently has one employee, [the] Senior Sales Manager, who is an 
independent sales contractor. The company plans to hire an additional sales person in 
September 2016, and three more employees over the course of 2017. 
The Petitioner submitted a lengthy job description, listing various categories of duties and the time the 
Beneficiary would devote to each, which is summarized below: 
Sales mana~ement 27% oftime 
Developing sales channels, posting openings online, interviewing candidates Up to 10 hrs/wk 
Visit customers to monitor sales and inventory Up to 12 hrs/wk 
Participate in fairs and trade shows 4-5 days/event 
Develop and implement a logistics plan Up to 5 hrs/wk 
Strategic planning Up to 4 hrs/wk 
Staff management 34•Yo of time 
Prepare manual with job descriptions and payment schedules Up to 2 hrs/wk 
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Matter ofT- T- LLC 
Train new sales representatives A vg. 16 hrs/wk 
Weekly staff meetings A vg. 2 Y2 hrs/wk 
Financial Management 34% oftime 
Control investment plan related to start-up costs Up to 5 hrs/wk 
Observe and control spending relative to sales Up to 8 hrs/wk 
Short, medium, and long-term projection and investment planning 
February-October Up to Y2 hr/wk 
November-December U_g to 8 hrs/wk 
Review financial results, prepare balances on quarterly reports Up to I hr/wk 
Representative Functions 5% oftime 
Handle bank business such as opening accounts and signing documents Up to 3 hrs/wk 
Represent company before government authorities Not specified 
The Petitioner's business plan anticipates hiring three salespersons and one administrative worker 
during 2016 and 2017. This small staff size does not appear to justify the Petitioner's projection that the 
Beneficiary would spend 10 hours per week locating and interviewing candidates, followed by 16 hours 
per week training the sales staff. (Existing contractors, whom the Petitioner has already named, will 
place no future demands on the Beneficiary's time in terms of recruitment and interviewing) . 
. On appeal, the Petitioner asserts that the duties described are consistent with the statutory definition 
of "executive capacity." The job description, however, raises significant questions. By stating the 
hours spent on most of the duties as ranges "up to" a particular maximum, the Petitioner has provided 
estimates that are too broad to be useful. The high figures in each range add up to more than 77 hours 
per week, and the total hours in each broad category do not correspond to the percentages assigned to 
those categories: 
Category 
Sales Functions 
Staff Management 
Financial Management 
Representative Functions 
Percentage of time 
27% 
34% 
34% 
5% 
Hours per week 
31 
20.5 
22.5 
>3 
Furthermore, many of the Beneficiary's claimed duties are not consistent with an executive capacity. 
The Petitioner claims, for instance, that the Beneficiary will spend up to 28 hours per week visiting 
customers and training sales staff. These are not high-level functions relating to directing the 
management of the organization, establishing its goals and policies, or discretionary decision-making. 
Also, while some activities such as training would arguably take up more of the Beneficiary's time 
during the company's initial start-up, it is the Petitioner's responsibility to show which of the 
Beneficiary's duties would continue beyond the start-up phase. The Petitioner has not done so, and 
therefore it has not shown that the Beneficiary's duties would be primarily those of an executive within 
one year of approval of the petition. 
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(b)(6)
Matter ofT- T- LLC 
2. Projected Organizational Structure 
The Petitioner's proposed organizational chart includes the following current and future employees: 
CEO [the Beneficiary] 
Senior Salesperson 
Hired 12/2015 
Commission-only 
Sales Team [5 named] 
2nd Salesperson 
To be hired 9/2016 
Administrative 
To be hired l/2017 
3rd Salesperson 
To be hired 3/2017 
4th Salesperson 
To be hired 9/2017 
The senior salesperson's resume lists his position as "company sales manager," and the organizational 
chart lists all other existing and future sales staff as subordinate to him. The record shows that the 
senior salesperson has his own limited liability company, An Independent 
Sales Representative Agreement between the Petitioner and specifies that 
"shall bear the title of Sales Representative." The agreement acknowledges "the 
Representative's intent to build a sales team," but this does not relieve owner from 
his own sales duties. Rather, the same paragraph that refers to the "sales team" also indicates that "[t]he 
Company 
may revoke the Representative's agreement should . the Company determine the 
Representative is not performing the Representative's function." The Petitioner has provided five 
names on the commission-only sales team, but the record contains no evidence to document how much 
work, if any, they have done for the Petitioner, or to establish their relationship with the one 
documented sales representative. 
The Director issued a request for evidence (RFE), asking for additional information regarding the 
scope of the new office, its organizational structure, and its financial goals. The Director requested 
more information about the company's staffing, including job descriptions. 
In response, the Petitioner submitted two new independent sales representative agreements and a 
marketing services agreement. The agreements do not indicate that the representatives report to the 
senior salesperson or are otherwise subject to his authority. 
The Petitioner also acknowledged that the existing sales staff consists of contractors rather than 
employees. The Petitioner stated: "Since the Beneticiary is not authorized to supervise employees 
until he has an L-1 A visa, he plans to begin hiring and training of salaried, full-time staff upon 
issuance of his visa." However, as noted, direct supervision of sales representatives does not qualify 
as a managerial or executive function. 
The Director·denied the petition, in part, because the Petitioner did not provide enough details about 
the positions that would be subordinate to the Beneficiary. The Director concluded that the 
Petitioner did not establish "a sufficient organization[ al] structure to relieve the beneficiary of 
performing primarily non-qualifying duties." 
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Matter ofT- T- LLC 
Although the Director's decision focused on the lack of information regarding the duties of the 
Beneficiary's intended subordinates, the Petitioner does not address this finding on appeal. The 
Petitioner states that the Beneficiary will have authority over financial matters such as investments, 
spending, and quarterly reports. The record does not show who will perform the administrative 
work regarding these matters. Preparing budgets and weekly reports and handling banking affairs 
are not duties typically assigned to an executive. In the absence of contrary evidence, it appears that 
the Beneficiary himself would have to handle the Petitioner's financial affairs. 
Similarly, the record contains copies of invoices, demonstrating that the company has already begun 
selling imported olive oil. The Petitioner has a contract with a warehouse, which accounts for 
storage and shipping of the Petitioner's inventory, but the Petitioner has not identified any proposed 
employees or contractors who would be responsible for the non-executive tasks of ordering or 
stocking inventory. 
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. 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 
managerial employees for a beneficiary to direct and a beneficiary must primarily focus on the broad 
goals and policies of the organization rather than 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 an owner or sole managerial employee. A 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." See section 10l(a)(44)(B) ofthe Act. 
Here, the Petitioner indicates that the Beneficiary's subordinates will include one· administrative 
employee and several sales representatives within one year, with no staff to carry out other functions 
of the company. While the job description conveys the Beneficiary's discretionary authority over 
the new office, the record does not show that he would have a subordinate level of managerial 
employees or sufficient subordinate staff to relieve him from significant involvement in the day-to­
day operations of the enterprise within one year so that he would be able to focus primarily on its 
broad policies and goals. 
Based on the deficiencies and inconsistencies discussed above, the Petitioner has not established that 
it will employ the Bene.ficiary in an executive capacity within one year of approval of the petition. 
B. Financial Ability 
The second and final stated ground for denial is the Director's conclusion that the Petitioner has not 
shown the size of the U.S. investment and the foreign entity's financial ability to remunerate the 
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Matter ofT- T- LLC 
Beneficiary and commence doing business in the United States as required by 8 C.F.R. 
§ 214.2(1)(3)(v)(C)(2). The Director cited three findings in support of this conclusion: 
• The P.etitioner's checking account balance is lower than the Beneficiary's offered annual 
salary; 
• The submitted documentation does not establish sufficient foreign investment to pay salaries 
and to commence doing business in the United States; and 
• "USCIS is unable to verify" the foreign entities' bank statements. 
With respect to the first issue above, the Petitioner correctly observes that there is no requirement for 
the Petitioner to have sufficient cash on hand to pay a full year's salary for the Beneficiary. 
Regarding the foreign entities' funds, the Petitioner notes that the foreign entities' latest income tax 
returns showed a combined net income, after taxes, of more than $330,000. The Director did not 
explain how USCIS was "unable to verify" the bank statements, and the record contains no evidence 
that would identify or explain any such efforts at verification. 
The Petitioner has overcome some of the Director's concerns regarding foreign investment, but there 
remains an issue of significant concern. The Petitioner's business plan indicated that an affiliate in 
Peru would invest $150,000 in the petitioning company in 2015; another $150,000 in 2016; and 
$100,000 in 2017. As the Petitioner acknowledges on appeal, the Peruvian company's 2015 net 
income, after taxes, was $274,528.22. 
Documentation from the Petitioner's bank does not show that the Petitioner received the full opening 
investment of $150,000. Rather, it shows a series of wire transfers between June and December of that 
year, totaling $137,431.37, These were the only deposits apart from a $1,000 starting balance. 
The business plan predicted that the Petitioner would purchase $400,000 in inventory in 2016, and sell 
it for $550,000, yielding a $150,000 profit. Against this profit, a separate budget forecast total 2016 
expenses of $215,500, resulting in a $65,500 deficit for the year. The business plan, however, did not 
explain how the Petitioner would pay for the initial $400,000 in inventory. The infusions of foreign 
capital would not reach $400,000 until the end of 2017, and then only if the company invested the full 
amount. The bank records show that the Petitioner did not receive the full amount shown for 2015. 
Taking the Petitioner's projected inventory costs into account, the Beneficiary would need $615,500 to 
meet its projected first-year expenses. The Petitioner's own business plan does not explain how it 
would meet those expenses. The Peruvian affiliate, identified as the sole foreign source of funding, 
does not have enough net annual income to meet those expenses. 
The Petitioner has not overcome the Director's finding that the foreign investment is not sufficient to 
cover the Petitioner's expenses. 
Matter ofT-T- LLC 
III. CONCLUSION 
The Petitioner did not establish: (1) that it will employ the Beneficiary in a managerial or executive 
capacity within one year of approval of the petition; and (2) the size of the U.S. investment and the 
foreign entity's ability to remunerate the Beneficiary and to commence doing business in the United 
States. 
ORDER: The appeal is dismissed. 
Cite as Matter qfT-T- LLC, ID# 229869 (AAO Mar. 16, 2017) 
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