dismissed L-1A Case: Food Service

PUBLIC COpy
identifying data deleted to
prevent clearly unwarranted
invasion of personal privacy
U.S. Department of Homeland Security
20 Massachusetts Ave., N.W., Rm. A3000
Washington, DC 20529
u.s.Citizenship
and Immigration
Services
File: SRC 0308652614 Office: TEXAS SERVICE CENTER Date: ocr 03 2007
IN RE: Petitioner:
Beneficiary:
Petition: Petition for a Nonimmigrant Worker Pursuant to Section 101(a)(15)(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.
RObertl'a~
Administrative Appeals Office
www.uscis.gov
SRC 0308652614
Page 2
DISCUSSION: The Director, Texas 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 extend the employment of its president as an L­
lA 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 corporation organized under the laws
of the State of Georgia and allegedly operates a submarine sandwich shop.
The director denied the petition concluding that the petitioner did not establish (1) that the beneficiary will be
employed in the United States in a primarily managerial or executive capacity; (2) that the petitioner has been
engaged in "doing business" for the prior year; or (3) that the petitioner has a qualifying relationship with the
foreign entity because the petitioner is operating its business pursuant to a franchise agreement.
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 beneficiary's duties are primarily those of an executive or manager. Counsel further argues
that the petitioner has been "doing business" and that its operation of a sandwich shop pursuant to a franchise
agreement has not altered its qualifying relationship with the foreign entity. Counsel also 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) ofthis section.
(ii) Evidence that the alien will be employed in an executive, managerial, or specialized
knowledge capacity, including a detailed description ofthe 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 hirn/her to perform the intended
SRC 0308652614
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services in the United States; however, the work in the United States need not be the
same work which the alien performed abroad.
As a threshold issue, it must be noted that the "new office" petition extension criteria found in 8 C.F.R. §
214.2(l)(14)(ii) are not applicable to the instant petition because the instant petition concerns a second petition
extension. While the petitioner had originally obtained an approval of a "new office" petition for a one-year
period in 2000 (SRC 00 055 54240), this initial petition was subsequently extended in 2001 for a two-year
period (SRC 01 095 52910), and the current petition seeks to extend this second petition. Therefore, the
director's direct application of the "new office" petition extension criteria in 8 C.F.R. § 214.2(1)(14)(ii) was in
error and shall be withdrawn. That being said, the substantive bases for the director's decision were
applicable to both "new office" petition extensions and to extensions generally ofL-1A visa petitions filed on
Form 1-129. Namely, all petitioners seeking petition extensions must establish that the beneficiary will
primarily perform qualifying duties and that the petitioner has a qualifying relationship with the foreign
employer, which includes the requirement that the petitioner establish that it is "doing business" as defined in
the regulations. Therefore, while the director's direct application of the "new office" petition extension
criteria was technically in error, this error was harmless in this particular matter.
In view of the above, the first issue in the present matter is whether the beneficiary will be employed by the
United States entity in a primarily managerial or executive capacity.
Section 101(a)(44)(A) of the Act, 8 U.S.c. § 1101(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:
SRC 0308652614
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(i) directs the management of the organization or a major component or function of the
organization;
(ii) establishes the goa1sand 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.
The petitioner does not clarify in the initial petition whether the beneficiary will be primarily engaged in
performing managerial duties under section 101(a)(44)(A) of the Act, or primarily executive duties under
section 101(a)(44)(B) of the Act. On appeal, counsel implies that the beneficiary will be employed as either a
manager or an executive. A petitioner may not claim that a beneficiary will be employed as a hybrid
"executive/manager" and rely on partial sections of the two statutory definitions. Given the lack of clarity, the
AAO will assume that the petitioner is asserting that the beneficiary will be employed as either an executive
or a manager and will consider both classifications.
The record as a whole indicates that the petitioner operates a single-location submarine sandwich shop
pursuant to a franchise agreement with Blimpie International, Inc. The petitioner describes the beneficiary's
job duties as "president" of the petitioner in a letter dated January 27,2003 as follows:
[The beneficiary] has been serving as president and CEO since transferring on L-1A in
February 2000. He has been very instrumental with our success and with our plans to
expand our operations. He has responsibility over all finance, marketing and
administrative operations of the company - over which he has been exercising complete
discretionary authority. [The beneficiary] has hired staff and exercises full authority over
them.
* * *
[The beneficiary] will continue to recruit and train the staff and have hiring and firing
authority over them, as well as further development and execution of our marketing
strategies. In addition [the beneficiary] continue to have responsibility for obtaining
contracts and entering contractual obligations for and on behalf of [the petitioner].
The petitioner also submitted wage reports for the petitioner indicating that, in the quarter immediately
preceding the filing of the instant petition, the petitioner employed three people including the beneficiary.
Moreover, the salaries paid to the other two employees in that quarter ($879.95 and $1,760.00 respectively)
indicate that these employees were more likely than not part-time employees. The beneficiary appears to be
the petitioner's only full-time employee. The petitioner also asserted in the letter dated January 27, 2003 that
it employs three people.
SRC 0308652614
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On June 20, 2003 the director requested additional evidence. The director requested, inter alia , descriptions
of the job duties of the petitioner's employees.
In response, the petitioner submitted a letter dated July 16 , 2003 describing the beneficiary's duties as follows :
1. Major decision making for petitioner relating to financing , marketing, personnel and
advertising. [The beneficiary] deals directly with petitioner's bankers regarding obtaining
loans and lines of credit. [The beneficiary] hires professional advertising agencies to
promote the restaurant with ad campaigns and special promotions in connection with
marketing to new market segment;
2. Approves renovations, remodeling and repairs for the restaurant ; taking reports of
maintenance problems from the manager , deciding when it is appropriate to hire outside
service to perform repairs or maintenance and choosing what repair services to use ;
3. Educates staff on promot ions and organizes employee meetings regarding policy on
customer service, dress code, etc.;
4. Develops expansion plans;
5. Advises accountant on how to deal with municipal and state agencies , making the
business decisions on how to comply w ith the licensing requirements , preparing and
submitting the required applications. The restaurant is inspected quarterly for compliance
with license requirements , but he becomes involved in those inspections only if the
inspectors report discrepancies;
6. Hires, fires and reviews performance of employees. Since the restaurant opened, [the
beneficiary] has interviewed and hired a total of nine employees , including part time
workers; three of those individuals no longer work for the restaurant. [The beneficiary]
confers with the supervisor who determine [ sic] when employees can have days off and,
when necessary, has the authority to terminate employment;
7. Reports to the parent corporation in India on the company's performance , business
activities, plans of expansion, current profit, loss and overall performance , often daily;
8. Liaise with restaurant's landlord;
9. Negotiates and signs all business contracts entered into by [the petitioner], including
loans, and being responsible for in vestigating opportunities to open similar restaurants at
other locations . He has also recently identified another site in Naperville, Illinois for a
restaurant and is currently negotiating the acquisition of this location and equipment ;
10. [The beneficiary] also oversee s specialized administration relating to contracts for
purchasing, sale and administrative accounting and management controls; and
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11. [The beneficiary] provides management leadership relating to establishing human
resources policies and procedures and to administer employee health, insurance, savings
and hiring programs.
The petitioner described the amount to time the beneficiary will devote to each of his duties as follows:
1. Time spent on Management Decisions
2. Time for Organizational Development
3. Representing the Company
4. Financial Representations
5. Supervising day to day operations
6. Negotiating Business deals
20%
15%
20%
20%
10%
15%
The petitioner also submitted an organizational chart for the United States operation. The chart shows an
entirely vertical organizational structure with the beneficiary at the top
of the organization supervising a
manager/accountant who, in tum, supervises an assistant manager who, in tum, supervises a front
desk/cashier worker, who, in tum, supervises a sandwich maker who, in tum, supervises a cleaner/helper.
The beneficiary is also shown to directly supervise temporary workers hired through an outside agency, and
the manager/accountant and the assistant manager are shown as jointly supervising yet another sandwich
maker. However, the wage reports for the petitioner only account for the manager/accountant and the
assistant manager and, as indicated above, these employees appear to be employed on a part-time basis. The
other workers identified in the organizational chart no longer appear to be employees of the petitioner as they
do not appear in the petitioner's most recent wage report.
Furthermore, the petitioner submitted evidence that it employed temporary workers to help staff its submarine
sandwich shop pursuant to an agreement with a third party agency. In 2002, it appears that the petitioner paid
the third party agency approximately $8,600.00 for these workers. At the $9.00 per hour rate identified in the
invoices, this would amount to approximately 956 hours of staff time, which would be equal to less than one
half-time employee. The petitioner offered no evidence that it is currently employing temporary workers.
Finally, the petitioner described the two subordinate employees in the letter dated July 16, 2003. The
"manager/accountant" was described as follows:
Manage restaurant selling sub sandwiches and beverages providing fast efficient service to
customers during peak hours. Formulate pricing policies, coordinate sales promotion,
manages inventory levels and serves as the company's accountant. Reconcile cash reports
and prepare and summarize daily and monthly operating reports. She holds a bachelor's
degree in Business Administration & Accounting.
The "assistant manager" was described as follows:
The assistant manager has responsibility over cashiers and sales clerks, over inventory and
day-to-day running of the business. The assistant manager has direct contact with the public
regarding customer relations and customer satisfaction.
SRC 03 086 52614
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On March 22, 2004, the director denied the petition. The director determined that the petitioner failed to
establish that the beneficiary will be employed in a primarily managerial or executive capacity.
On appeal, counsel to the petitioner asserts that the director erred and that the beneficiary's duties are
primarily those of an executive or manager.
Upon review, counsel's assertions are not persuasive.
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. § 214.2(l)(3)(ii). 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
either in an executive or managerial capacity. ld. As indicated above, the record as a whole indicates that the
petitioner operates a single-location submarine sandwich shop in Stone Mountain, Georgia, pursuant to a
franchise agreement with Blimpie International, Inc. 1 The beneficiary appears to be the sole owner and
operator of this establishment. However, the petitioner's description of the beneficiary's job duties has failed
to establish that the beneficiary will act in a "managerial" capacity in his operation of the sandwich shop.
First, in support of its petition, the petitioner has provided a vague and nonspecific description of the
beneficiary's duties that fails to demonstrate what the beneficiary will do on a day-to-day basis. For example,
the petitioner states that the beneficiary will engage in decision making "relating to financing, marketing,
personnel and advertising;" will educate the staff; will develop expansion plans; will negotiate and oversee
the administration relating to contracts; and will provide "management leadership relating to establishing
human resources policies and procedures." However, the petitioner does not explain how, exactly, the
beneficiary will implement his decisions when the petitioner only employs two part-time subordinate
employees; how the petitioner will finance and research its expansion plans; or what, exactly, the beneficiary
will do in overseeing and negotiating contracts. The fact that the petitioner has given the beneficiary a
managerial title and has prepared a vague job description which includes lofty duties does not establish that
the beneficiary will actually perform managerial duties. Specifics are clearly an important indication of
whether a beneficiary's duties are primarily executive or managerial in nature; otherwise meeting the
definitions would simply be a matter of reiterating the regulations. Fedin Bros. Co., Ltd. v. Sava, 724 F.
Supp. 1103 (E.D.N.Y. 1989), aff'd, 905 F.2d 41 (2d. Cir. 1990). Going on record without supporting
documentary evidence is not sufficient for purposes of meeting the burden of proof in these proceedings.
Matter of Treasure Craft ofCalifornia, 14 I&N Dec. 190 (Reg. Comm. 1972).
Second, it appears that the beneficiary will be performing primarily non-qualifying administrative or
operational tasks which do not rise to the level of being managerial or executive in nature. For example, the
'u is noted that, in response to the Request for Evidence, the petitioner submitted evidence regarding
additional business ventures involving the petitioner. However, this evidence refers to business activity
taking place after the date the instant petition was filed. Therefore, this evidence is irrelevant and will not be
considered. The petitioner must establish eligibility at the time of filing the nonimmigrant visa petition. A
visa petition may not be approved at a future date after the petitioner or beneficiary becomes eligible under a
new set of facts. Matter ofMichelin Tire Corp., 17 I&N Dec. 248 (Reg. Comm. 1978).
SRC 03 086 52614
Page 8
petitioner states that the beneficiary will be responsible for virtually all aspects of the operation of the
sandwich shop including financing, marketing, advertising, training, renovations, contracting, and personnel
matters. However, such duties constitute administrative or operational tasks when the tasks inherent to these
duties, such as bookkeeping, banking, and working as a first-line supervisor of non-professional employees,
are performed by the beneficiary. As the organizational chart, wage reports, and job descriptions for the
subordinate employees fail to identify any employees or contractors who will relieve the beneficiary of the
need to perform the non-qualifying tasks inherent to the general operation and management of the business, it
must be concluded that he will perform these tasks. While the record indicates that petitioner employs two
part-time employees and has occasionally employed temporary workers, it has not been demonstrated that
these workers will relieve the beneficiary of the need to perform non-qualifying duties other than the most
basic customer service functions, e.g., making sandwiches and taking orders. Moreover, as these workers
appear to be part-time, it has not been established that the beneficiary will even be relieved of the need to
prepare food and directly serve the sandwich shop customers. As the petitioner has not established how much
time the beneficiary devotes to such non-qualifying tasks, it cannot be confirmed that he will be "primarily"
employed as a manager. 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). The fact that the beneficiary is the sole "managerial" employee, or the sole owner of the petitioner,
does not establish that he will primarily be employed as a manager or executive.
The petitioner has also failed to establish that the beneficiary will supervise and control the work of other
supervisory, managerial, or professional employees, or will manage an essential function of the organization.
As explained in the organizational chart, wage reports, and job descriptions for the subordinate staff members,
the beneficiary appears to supervise a staff of two employees and, occasionally, the provision of services by
temporary workers. However, the petitioner has not established that the two employees are primarily engaged
in performing supervisory or managerial duties. To the contrary, it appears that these employees are
performing the tasks necessary to produce a product or to provide a service, i.e., working at the submarine
sandwich shop. Furthermore, inflated job titles and artificial tiers of subordinate employees are not probative
and will not establish that an organization is sufficiently complex to support a managerial position. Not only
has the petitioner failed to establish the ongoing employment of most of the workers identified in the
organizational chart, it is simply not credible that a single-location submarine sandwich shop would require so
many employees to perform supervisory or managerial duties. In view of the above, the beneficiary would
appear to be primarily a first-line supervisor of non-professional employees, the provider of actual services, or
a combination of both. A managerial employee must have authority over day-to-day operations beyond the
level normally vested in a first-line supervisor, unless the supervised employees are professionals.
101(a)(44)(A)(iv) of the Act; see also Matter of Church Scientology International, 19 I&N Dec. at 604.
Moreover, the petitioner has not established that the beneficiary will manage professional employees?
2In evaluating whether the beneficiary manages professional employees, the AAO must evaluate whether the
subordinate positions require a baccalaureate degree as a minimum for entry into the field of endeavor.
Section 101(a)(32) of the Act, 8 U.S.c. § 1101(a)(32), states that "[t]he term profession shall include but not
be limited to architects, engineers, lawyers, physicians, surgeons, and teachers in elementary or secondary
schools, colleges, academies, or seminaries." The term "profession" contemplates knowledge or learning, not
SRC 0308652614
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Therefore, the petitioner has not established that the beneficiary will be employed primarily in a managerial
. 3
capacity.
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
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"
merely skill, of an advanced type in a given field gained by a prolonged course of specialized instruction and
study of at least baccalaureate level, which is a realistic prerequisite to entry into the particular field of
endeavor. Matter of Sea, 19 I&N Dec. 817 (Comm. 1988); Matter of Ling, 13 I&N Dec. 35 (R.C. 1968);
Matter of Shin, 11 I&N Dec. 686 (D.D. 1966). Therefore, the AAO must focus on the level of education
required by the position, rather than the degree held by subordinate employee. The possession of a bachelor's
degree by a subordinate employee does not automatically lead to the conclusion that an employee is employed
in a professional capacity as that term is defined above. In the instant case, the petitioner has not, in fact,
established that bachelor's degrees are actually necessary to perform the duties of the subordinate employees.
3While the petitioner has not clearly argued that the beneficiary will manage an essential function of the
organization, the record nevertheless would not support this position even if taken. 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. The petitioner's vague job
description fails to document what proportion of the beneficiary's duties will be managerial functions, if any,
and what proportion will be non-manageria1. Also, as explained above, the record establishes that the
beneficiary will primarily be a first-line supervisor of non-professional employees working at the sandwich
shop and/or will be engaged in performing non-qualifying operational or administrative tasks related to the
operation of the sandwich shop. Absent a clear and credible breakdown of the time spent by the beneficiary
performing his duties, the AAO cannot determine what proportion of his duties would be managerial, nor can
it deduce whether the beneficiary will primarily perform the duties of a function manager. See IKEA US, Inc.
v. u.s. Dept. ofJustice, 48 F. Supp. 2d 22,24 (D.D.C. 1999).
SRC 03 08652614
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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. The job description provided
for the beneficiary is so vague that the AAO cannot deduce what the beneficiary will do on a day-to-day
basis. Moreover, as explained above, it appears that the beneficiary will primarily be employed as a first-line
supervisor and 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). The size of a company may be especially relevant when CIS notes
discrepancies in the record and fails to believe that the facts asserted are true. !d. In this matter, the
petitioner's description of its staffing is rife with inconsistencies. For example, while the petitioner asserts in
its organizational chart that it employs seven people in addition to temporary workers, the most recent wage
report for the petitioner indicates that it actually employs only three people. The petitioner offers no
explanation for this serious inconsistency. 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 ofHo, 19 I&N Dec. 582, 591-92 (BIA 1988). Doubt cast on any aspect of the petitioner's proof may,
of course, lead to a reevaluation of the reliability and sufficiency of the remaining evidence offered in support
of the visa petition. Id. at 591.
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 reason.
The second and third issues in the present matter concern whether the petitioner has established that it has a
qualifying relationship with the foreign entity."
The regulation at 8 C.F.R. § 214.2(1)(3)(i) states that a petition filed on Form 1-129 shall be accompanied by:
4Inconsidering the second issue in the present matter, it is noted that the director concluded that the petitioner
failed to establish that it has been "doing business" for the previous year. Upon review, the AAO disagrees
and will withdraw this portion of the director's decision. The petitioner has submitted evidence sufficient to
establish that it is more likely than not that it has been engaged in business in a continuous, systematic, and
regular fashion. The petitioner has submitted a franchise agreement and other materials related to its acquisition
of the sandwich shop business from a prior franchisee; tax returns; corporate organizational documents; invoices
related to the petitioner's acquisition of supplies; rent invoices; and bank statements reflecting frequent
withdrawals and deposits, some of which appear to concern credit card purchases by customers of the sandwich
shop. In view ofthe bank statements, the director's determination that the petitioner has submitted no evidence of
being engaged in business appears to have been erroneous. However, because the petitioner has otherwise failed
to establish that it has a qualifying relationship with the foreign employer given the ceding of control to the
franchisor, the petition will nevertheless be denied.
SRC 0308652614
Page 11
Evidence that the petitioner and the organization which employed or will employ the alien are
qualifying organizations as defined in paragraph (l)(l)(ii)(G) of this section.
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 defmitions of a parent, branch,
affiliate or subsidiary specified in paragraph (l)(l)(ii) of this section." 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."
In this matter, the petitioner asserts that both the United States entity and the foreign employer are owned and
controlled by the beneficiary. Therefore, if true, the two employers would meet the definition of "affiliate" under
the regulations. The petitioner also asserts that it has been doing business for the past year as the operator of a
submarine sandwich shop pursuant to a franchise agreement with Blimpie International, Inc. In support of its
petition, the petitioner submitted a franchise agreement and other materials related to its acquisition of the
sandwich shop business from a prior franchisee; tax returns; corporate organizational documents; invoices related
to the petitioner's acquisition of supplies; rent invoices; and bank statements reflecting frequent withdrawals and
deposits, some of which appear to concern credit card purchases by customers of the sandwich shop. The
franchise agreement sets forth numerous rules and regulations regarding the petitioner's operation of a Blimpie
submarine sandwich shop. These rules control the location and operation of the sandwich shop including the
petitioner's purchase of supplies, employee training, hours of operation, and advertising. Importantly, the
franchise agreement restricts the petitioner's involvement in outside business interests in article 10.
On June 20, 2003, the director requested additional evidence. The director requested, inter alia, evidence
regarding the petitioner's business activities for the past year.
In response, the petitioner submitted additional invoices, bank statements, and wage reports.
On March 22, 2004, the director denied the petition. The director concluded that the petitioner failed to establish
that it has been "doing business" as defined in the regulations. The director further concluded that, since the
petitioner is operating a business under a franchise agreement, if failed to establish that it has a qualifying
relationship with the foreign entity.
On appeal, counsel argues that the petitioner has been "doing business" for the past year and that its operation
of a sandwich shop pursuant to a franchise agreement has not altered its qualifying relationship with the
foreign entity.
Upon review, counsel's assertions are not persuasive.
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; 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
SRC 0308652614
Page 12
and authority to direct the establishment, management, and operations of an entity. Matter of Church
Scientology International, 19 I&N Dec. at 595.
Although a franchise may be an asset of an independently owned and operated company, and pursuit of a
franchise business model alone does not automatically disqualify a petitioner from establishing that it has a
qualifying relationship with a foreign entity, the petitioner must prove that it has retained the necessary
latitude to control, direct, and develop the enterprise. See Matter ofKung, 17 I&N Dec. 260 (BIA 1978). In
this case, the petitioner has ceded control over the enterprise to the franchisor, Blimpie International, Inc. As
explained in the franchise agreement, the franchisor controls the location and operation of the sandwich shop
including the petitioner's purchase of supplies, employee training, hours of operation, and advertising.
Importantly, the franchise agreement restricts the petitioner's involvement in outside business interests in article
10. While counsel argues on appeal that the franchise agreement does not prohibit the petitioner's ability to invest
in other business opportunities, this characterization of the agreement is not accurate. The expensive and time
consuming obligations placed upon the petitioner in operating a Blimpie's sandwich shop, when coupled with the
contractual restrictions on the petitioner's outside business activities, have resulted in the petitioner having lost
any realistic ability to control, direct, or develop its enterprise. Therefore, there is no qualifying relationship
between the foreign entity and the petitioner as control over the petitioner's business has been ceded to the
franchisor.
Accordingly, the petitioner has not proven that the petitioner and the foreign entity have a qualifying
relationship as defined by 8 C.F.R. § 214.2(1)(1)(ii)(G), and the petition will be denied for that reason.
In visa petition proceedings, the burden of proving eligibility for the benefit sought remains entirely with the
petitioner. Section 291 of the Act. Here, that burden has not been met. Accordingly, the appeal will be
dismissed.
ORDER: The appeal is dismissed.