dismissed L-1A Case: Investment

U.S. Department of Homeland Security 
20 Mass. Ave., N.W., Rm. A3042 
Washington, DC 20529 
U. S. Citizenship 
and Immigration 
FILE: SRC 03 079 53783 Office: TEXAS SERVICE CENTER Date: ; 3 ,: 7 .tQ@5 
. - 
PETITION: Petition for a Nonimmigrant Worker Pursuant to Section 101(a)(15)(L) of the Immigration 
and Nationality Act, 8 U.S.C. 5 1 101(a)(15)(L) 
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, Director 
Administrative Appeals Office 
SRC 03 079 53783 
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DISCUSSION: The Director, Texas Service Center, denied the petition for a nonimrnigrant visa. The 
petitioner filed a motion to reopen and reconsider on June 4, 2003, which the director granted. On September 
8, 2003, the director affirmed the previous decision and denied the petition. The matter is now before the 
Administrative Appeals Office (AAO) on appeal. The AAO will dismiss the appeal. 
The petitioner filed this nonimmigrant petition seeking to employ the beneficiary as a nonirnrnigrant 
intracompany transferee pursuant to section 101(a)(15)(L) of the Immigration and Nationality Act (the Act), 8 
U.S.C. 5 1101(a)(15)(L). The petitioner is a corporation organized in the State of North Carolina that claims 
to be operating as a private investment company. The petitioner also claims that it is the subsidiary of the 
beneficiary's foreign employer, located in Nyahurwu, Kenya. The petitioner now seeks to employ the 
beneficiary as its president for one year. 
The director denied the petition concluding that the petitioner had not established that: (1) it had secured a 
"viable business" in the United States; (2) that the petitioning organization had been funded or capitalized by 
the foreign entity; and (3) that the beneficiary possessed the requisite one-year of foreign employment in a 
qualifying capacity. 
On motion, counsel submitted a "bill of sale," executed on May 29, 2003, as evidence of the petitioner's 
purchase of a "Subway" restaurant, and provided bank statements representing funds available to the 
I 
petitioner. The petitioner also submitted new evidence, including letters from businesses in Kenya, in support 
of its claim that the beneficiary was employed abroad in a qualifying capacity for the requisite one year. 
In her September 9, 2003 decision, the director recognized the petitioner's agreement of sale for the Subway 
restaurant, but noted that, although requested, the petitioner had failed to provide a copy of the franchise 
agreement related to the purchase of the restaurant. The director stated that while the petitioner may own the 
franchise, it does not control it. Accordingly, the director affirmed the previous decision and denied the 
petition. 
On appeal, counsel states that the director erred in denying the petition, claiming that the foreign entity has 
"effective control" of the petitioning organization. Counsel notes that the United States company is not a 
Subway franchise, but rather "a North Carolina corporation with properly issued shares to the Kenyan 
company." Counsel submits a brief and documentary evidence on appeal. 
To establish L-1 eligibility, the petitioner must meet the criteria outlined in section 101(a)(15)(L) of the Act, 8 
U.S.C. 5 1101(a)(15)(L). Specifically, within three years preceding the beneficiary's application for 
admission into the United States, 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. 
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. 
1 The regulation at 8 C.F.R. 5 214.2(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)(l)(ii)(G) of this section. 
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(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 hirnlher 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. 
Pursuant to the regulation at 8 C.F.R. 5 214.2(1)(3)(~), if the petition indicates that the beneficiary is coming 
to the United States as a manager or executive to open or be employed in a new office in the United States, 
the petitioner shall submit evidence that: 
(A) Sufficient physical premises to house the new office have been secured; 
(B) The beneficiary has been employed for one continuous year in the three year period 
preceding the filing of the petition in an executive or managerial capacity and that the proposed 
employment involved executive or managerial authority over the new operation; 
(C) The intended United States operation, within one year of the approval of the petition, will 
support an executive or managerial position as defined in paragraphs (l)(l)(ii)(B) or (C) of this 
section, supported by information regarding: 
(I) The proposed nature of the office describing the scope of the entity, its organizational 
structure, and its financial goals; 
(2) 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 
(3) The organizational structure of the foreign entity. 
As noted above, in her May 5, 2003 decision, the director determined that the petitioner had failed to 
demonstrate that it had secured a viable business in the United States, that it had been funded by the foreign 
entity, and that the beneficiary was employed abroad for one year in a qualifying capacity. Following the 
petitioner's motion to reopen and reconsider, the director affirmed the previous decision. On appeal, counsel 
does not address the issues of whether the petitioner had secured a business in the United States at the time of 
filing the petition, or whether the beneficiary was employed abroad for one year as a manager or an executive. 
Therefore, the director's decision on these two issues will be affirmed. Going on record without supporting 
I documentary evidence is not sufficient for purposes of meeting the burden of proof in these proceedings. 
Matter of Treasure Craft of California, 14 I&N Dec. 190 (Reg. Cornrn. 1972). 
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The AAO will address the remaining issue as to whether the beneficiary's foreign employer and the 
petitioning organization possess a qualifying relationship as required in the Act at $ 101(a)(15)(L), 8 U.S.C. 
$ 1101(a)(15)(L). 
The pertinent regulations at 8 C.F.R. § 214.2(1)(l)(ii) define the term "qualifying organization" and related 
terms as follows: 
(G) Qualifying organization means a United States or foreign firm, corporation, or other legal 
entity which: 
(I) 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; 
(2) Is or will be doing business (engaging in international trade is not 
required) as an employer in the United States and in at least one other country 
directly or through a parent, branch, affiliate or subsidiary for the duration of the 
alien's stay in the United States as an intracompany transferee; and, 
(3) Otherwise meets the requirements of section 101(a)(15)(L) of the Act. 
(I) Parent means a firm, corporation, or other legal entity which has subsidiaries. 
(J) Branch means an operating division or office of the same organization housed in a different 
location. 
(K) Subsidiary means a firm, corporation, or other legal entity of which a parent owns, directly or 
indirectly, more than half of the entity and controls the entity; or owns, directly or indirectly, half 
of the entity and controls the entity; or owns, directly or indirectly, 50 percent of a 50-50 joint 
venture and has equal control and veto power over the entity; or owns, directly or indirectly, less 
than half of the entity, but in fact controls the entity. 
(L) Afiliate means 
(I) One of two subsidiaries both of which are owned and controlled by the 
same parent or individual, or 
(2) One of two legal entities owned and controlled by the same group of 
individuals, each individual owning and controlling approximately the same 
share or proportion of each entity. 
The petitioner filed the nonimmigrant petition on January 22, 2003, stating that it is a wholly owned 
subsidiary of the beneficiary's foreign employer. In an attached letter from the petitioner, dated December 16, 
2002, the petitioner again noted that a qualifying relationship exists "as the Kenyan parent company wholly 
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owns and controls the U.S. subsidiary." The petitioner submitted a stock certificate reflecting ownership of 
100 of the petitioner's 1,000 authorized shares by the beneficiary's foreign employer. The petitioner provided 
an August 2002 bank statement for a personal bank account held by the beneficiary in the United States. The 
petitioner also submitted bank statements for the beneficiary's personal bank account in Kenya for the dates 
March 2001 through July 2002. In addition, the petitioner submitted wire transfer statements reflecting 
several funds transfers from October 2001 through September 2002. 
On February 1, 2003, the director requested that the petitioner provide copies of all stock certificates issued 
by the petitioning organization and evidence of the funding or capitalization of the United States company. 
The director noted that such evidence should include copies of wire transfers, canceled checks deposited into 
the petitioner's bank account, or a letter signed by a bank officer indicating the account value and the source 
of the investment. The director also asked that the petitioner submit evidence of its receipt of an employer 
identification number (EIN) issued by the Internal Revenue Service (IRS). 
Counsel responded in a letter dated April 1, 2003, stating that the petitioner issued only one stock certificate 
for 100 shares to the beneficiary's foreign employer. Counsel provided a copy of the stock certificate and 
transfer ledger, and resubmitted copies of wire transfers and bank statements, which counsel stated is 
evidence of the funding of the United States company. With regard to the petitioner's employer identification 
number, counsel explained that the petitioner has not been able to receive an EIN as the beneficiary does not 
yet have a social security number, which is required on the EIN application. Counsel stated that the petitioner 
is in the process of applying for an EIN with a new corporate officer, who possesses a U.S. social security 
number. Counsel provided a copy of a letter from the IRS explaining that the petitioner's application for an 
EIN has been rejected because it lacked a social security number or individual taxpayer identification number. 
Counsel provided the petitioner's subsequent application for an individual taxpayer identification number and 
the petitioner's second application for an EIN. 
The director determined in her decision, dated May 5, 2003, that the petitioner had failed to "establish the 
funding or capitalization of the U.S. company which has yet to be established." Consequently, the director 
denied the petition. The director again determined in her September 8, 2003 decision issued in response to 
the petitioner's motion to reopen and reconsider, that the petitioner did not establish that the foreign entity 
possessed control of the petitioning organization. The director stated: 
Absent the actual franchise agreement, [Citizenship and Immigration Services (CIS)] can 
only surmise the terms based on other franchise agreements, but more importantly on prior 
experience with Subway franchise agreements, which are very restrictive in the criteria of the 
physical premises and the operational end of the business. The ownerloperator must conform 
to the guidelines set forth in the franchise agreement. 
The director outlined Operating Instruction 214.2(1)(4) as guidance that a business relationship based on a 
franchise agreement is typically not considered qualifying. The director stated that while the petitioner may 
own the franchise, it does not control it. Accordingly, the director affirmed the previous decision and denied 
the petition. 
In an appeal filed on October 2, 2003, counsel states that the director erroneously denied the petition as the 
foreign entity has control of the petitioning organization. Counsel states that the beneficiary's foreign 
employer is the sole owner of the petitioning organization, and again submits the petitioner's stock certificate 
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reflecting ownership by the foreign entity. Counsel states that the petitioner it is in the process of purchasing 
a Subway franchise in Arkansas as part of its business plan. Counsel notes that the qualifying relationship 
however, is not based on the franchise, but rather is between the petitioning organization, as a new United 
States office, and the foreign entity. Counsel claims that the foreign entity owns and has "effective control" 
of the petitioning organization, and therefore satisfies the requirements for the nonimrnigrant visa. 
On review, the petitioner has not established that the beneficiary's foreign employer and the petitioning 
organization possess the requisite qualifying relationship. 
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 (BIA 1988); see also 
Matter of Siemens Medical Systems, Inc., 19 I&N Dec. 362 (BIA 1986); Matter of Hughes, 18 I&N Dec. 289 
(Comrn. 1982). In 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. 
As general evidence of a petitioner's claimed qualifying relationship, stock certificates alone are not sufficient 
evidence to determine whether a stockholder maintains ownership and control of a corporate entity. The 
corporate stock certificate ledger, stock certificate registry, corporate bylaws, and the minutes of relevant 
annual shareholder meetings must also be examined to determine the total number of shares issued. the exact 
number issued to the shareholder. and the subsequent percentage ownership and its effect on corporate 
control. Additionally, a petitioning company must disclose all agreements relating to the voting of shares, the 
distribution of profit, the management and direction of the subsidiary, and any other factor affecting actual 
control of the entity. See Matter of Siemens Medical Systems, Inc., 19 I&N Dec. at 364-365. Without full 
disclosure of all relevant documents, CIS is unable to determine the elements of ownership and control. 
In the instant matter, the record contains insufficient evidence to establish that the beneficiary's foreign 
employer owns the petitioning organization. Although the submitted stock certificate and transfer ledger 
identify the foreign entity as the sole owner of the petitioner's issued stock, there is conflicting evidence of the 
consideration that was purportedly provided in exchange for the stock ownership. The petitioner references 
bank statements and wire transfer statements as evidence of the foreign entity's funding of the petitioning 
organization. However, both the bank statements and wire transfers are dated at least three months prior to 
the issuance of stock in December 2002. Moreover, the bank statements refer to individual bank accounts 
held by the beneficiary in the United States and abroad. None of the bank or wire transfer statements 
specifically reference the petitioning organization as the account owner or as the recipient of funds but instead 
list individuals as the transferors. The petitioner did not provide any documentation reflecting consideration 
given by the foreign entity in exchange for the petitioner's stock. Absent additional evidence, the AAO 
cannot conclude that the foreign entity possesses ownership and control of the petitioning organization. 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). Accordingly, the petitioner has not demonstrated the existence of a qualifying relationship between 
the two organizations. For this reason, the appeal will be dismissed. 
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For purposes of clarification, the AAO will next address the issue raised by the director of a qualifying 
relationship as it relates to a franchise. An association between a foreign and U.S. entity based on a franchise 
agreement is usually insufficient to establish a qualifying relationship. See 0.1. 214.2(1)(4)(iii)(D) 
(associations between companies based on factors such as ownership of a small amount of stock in another 
company, or licensing or franchising agreements do not create affiliate relationships between the entities for L 
purposes); 9 FAM 41.54 N7.1-5. As noted by the director, a franchise, like a license, typically requires that 
the franchising organization comply with the franchisor's restrictions, without actual ownership and control of 
the franchise organization. See Matter of Schick, 13 I&N Dec. 647 (Reg. Comm. 1970) (no qualifying 
relationship exists where the association between two companies was based on a license and royalty 
agreement that was subject to termination since the relationship was determined to be "purely contractual"). 
In other words, the contractual agreement between the foreign organization and the U.S. corporation can be 
terminated as opposed to one in which the foreign organization and a domestic organization are permanently 
tied together and not limited to a single, specific venture. Id. In the instant matter, the AAO need not 
consider the relationship between the petitioner and the franchising organization. The petitioner has provided 
evidence establishing the existence of a separate United States organization rather than the petitioner acting as 
a franchised business activity. However, since the petitioner did not submit the franchise agreement and 
admits that the agreement was not final, the petitioner's reliance on this document to establish eligibility is 
purely speculative. 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 of Michelin Tire Corp., 17 I&N Dec. 248 (Reg. Comm. 1978). 
Beyond the decision of the director, the petitioner has not demonstrated that one year after the filing of the 
nonirnmigrant petition the beneficiary would be employed in the United States in a primarily qualifying 
capacity. See 8 C.F.R. 5 214.2(1)(3)(v)(C). The petitioner stated in its December 16, 2002 letter submitted 
with the petition that the beneficiary would "be ultimately responsible" for such non-qualifying duties as 
analyzing the company's financial reports and developing marketing strategies. The petitioner's proposed 
staffing, which includes a secretary and manager and other lower-level employees depending on the type of 
business purchased, does not account for the performance of these non-managerial and non-executive 
functions by other employees. An employee who primarily performs the tasks necessary to produce a product 
or to provide services is not considered to be employed in a managerial or executive capacity. Matter of 
Church Scientology International, 19 I&N Dec. at 604. Consequently, the AAO cannot conclude that within 
one year of approval of the petition the beneficiary would be employed in a qualifying capacity. For this 
additional reason, the appeal will be dismissed. 
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, Znc. v. United States, 229 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). 
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. 5 1361. Here, that burden has not been met. Accordingly, the 
director's decision will be affirmed and the petition will be denied. 
ORDER: The appeal is dismissed.