dismissed L-1A Case: Restaurant

U.S. Citizenship 
and Immigration 
Services 
MATTER OF S-G- INC. 
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: JAN. 23, 2017 
APPEAL OF CALIFORNIA SERVICE CENTER DECISION 
PETITION: FORM I-129, PETITION FOR A NONIMMIGRANT WORKER 
The Petitioner, a restaurant business with one employee, seeks to extend the Beneficiary's temporary 
employment as its president under the L-1 A nonimmigrant classification for intracompany 
transferees: See Immigration and Nationality Act (the Act) section 101(a)(15)(L), 8 U.S.C. § 
1101(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 
Petitioner did not submit sufficient evidence to establish that ( 1) it is doing business in accordance 
with the regulations and (2) that the Beneficiary would be employed in the United States m a 
managerial or executive capacity. 
The matter is now before us on appeal. In support of the appeal, the Petitioner submits a brief 
addressing the grounds for denial. 
Upon de novo review, we will dismiss the appeal. 
I. LAW 
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 1 continuous year within 3 years preceding the beneficiary's application for admission 
into the United States. Section 101(a)(15)(L) ofthe Act. 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. !d. 
An individual petition filed on Form I-129, Petition for a Nonimmigrant Worker, 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 
(1)(1)(ii)(G) ofthis section. 
Matter of S-G- Inc. 
(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 qualities 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. 
8 C.P.R. § 214.2(1)(3). In addition, the regulation at 8 C.P.R. § 214.2(1)(14)(ii) provides that a visa 
petition, which involved the opening of a new office, may be extended by filing a new P orm I -129, 
accompanied by the following: 
(A) Evidence that the United States and foreign entities are still qualifying 
organizations as defined in paragraph (I)( 1 )(ii)(G) of this section; 
(B) Evidence that the United States entity has been doing business as defined in. 
paragraph (1)( 1 )(ii)(H) of this section for the previous year; 
(C) A statement of the duties performed by the beneficiary for the previous year 
and the duties the beneficiary will perform under the extended petition; 
(D) A statement describing the staffing of the new operation, including the 
number of employees and types of positions held accompanied by evidence of 
wages paid to employees when the beneficiary will be employed in a 
managerial or executive capacity; and 
(E) Evidence ofthe financial status ofthe United States operation. 
II. ANALYSIS 
A. Doing Business in the United States 
I 
The Director denied the Petition based, in part, on the finding that the Petitioner did not establish 
that it is doing business in the United States. The regulation at 8 C.P.R. § 214.2(1)(1 )(ii)(H} defines 
that term as follows: 
2 
Matter of S-G- Inc. 
Doing business means the regular, systematic and continuous provisiOn of goods 
and/or services by a qualifying organization and does not include the mere presence 
of an agent or office of the qualifying organization in the United States and abroad. 
On Form I-129 the Petitioner claimed to be a restaurant business that was established in 2015 with a 
net annual income of negative $37,470. In the accompanying supporting statement the Petitioner 
stated that it is in the process of developing a new restaurant chain. Although the Petitioner claimed 
that "development efforts are well under way," it explained that the restaurant was not open at the 
time of filing and that it is "in the late stages of developing its first location, which will open in late 
summer or early [ f]all 2016 .... " The Petitioner did not provide evidence to establish that it has 
been doing business for the previous year, as required by the regulation at 8 C.F.R. 
§ 214.2(1)(14)(ii)(B). 
Accordingly, the Director issued a request for evidence (RFE) allowing the Petitioner to supplement 
the record with evidence showing that it is doing business. As noted in the Director's decision, the 
RFE provided the Petitioner with a list of suggested evidence it could submit to demonstrate that it 
has been doing business for the requisite 1-year time period. 
In response, the Petitioner provided, in part, bank documents, construction and design contracts, 
licenses and permits, and financial statements. However, after reviewing the Petitioner's 
submissions, the Director denied the petition, finding that the evidence provided was not sufficient to 
, establish that the Petitioner was doing business for the year prior to filing the instant petition. 
On appeal, the Petitioner does not dispute the Director's finding and instead provides an explanation 
claiming that as a result of various construction obstacles that were "beyond its control," the 
Petitioner was forced to delay the start of any sales activity and the hiring of employees to staff the 
organization. The Petitioner contends that we have the authority to "exercise [our] discretion with 
flexibility in such situations" as articulated in the present matter and to approve the petition. 
Contrary to the Petitioner's understanding as to the extent of our discretionary authority, there is no 
statute or regulation that allows us to ignore or circumvent express regulatory requirements, which, 
in the present matter, unambiguously state that a visa petition that involved the opening of a new 
office may be extended orily if the Petitioner meets all of the enumerated regulatory criteria, 
including establishing that the Petitioner was doing business for the previous year. !d. Here, the 
Petitioner does not dispute the Director's finding that it was not doing business during the requisite 
1-year time period. In fact, based on the information provided, the Petitioner indicates that its initial 
intent in bringing the Beneficiary to the United States was to make necessary arrangements for the 
Petitioner to commence doing business at an undefined time in the future. Ther~ is no indication that 
the Petitioner either had the intent or the ability to commence doing business upon the Beneficiary's 
arrival under the initially approved new office petition. 
The Petitioner further states that it has no need to hire employees because it has not yet begun to 
provide goods or services in a regular and systematic manner and cites Matter of Leacheng Int 'l, 
3 
Matter of S-G- Inc. 
Inc., 26 I&N Dec. 532, 535-6 (AAO 20 15), to support its contention that a petitioner can be deemed 
to be doing business, despite its inability to provide goods or services to third parties. In the holding 
of the cited case, we found that a petitioner need not provide goods and/or services to unrelated third 
parties in order to be deemed to be doing business, so long as it can establish that it provides goods 
and/or services to related companies within its multinational organization." ld. at 535. Having 
reviewed the totality of the evidence in Matter of Leacheng, we found that "the petitioner established 
that it provides services to its foreign affiliate by marketing the foreign entity's products, locating 
buyers, maintaining relationships with customers, and facilitating the completion of sales contracts 
and shipping arrangements in the United States" and that the petitioner was remunerated for 
providing these services. ld. at 536. 
While the Petitioner properly summarized the holding in the above precedent decision, it did not 
establish that the facts in the present matter are analogous to those in the cited case. Namely, the 
evidence in the instant record indicates that the Petitioner has taken steps to ensure the eventual 
opening of a business operation in the United States. While succeeding in this endeavor would 
allow the foreign entity to realize some financial gain as a result of its capital investment in the U.S. 
business venture, this benefit is not synonymous with providing service as the petitioner in Matter of 
Leacheng did and for which it received monetary compensation pursuant to a contractual agreement 
it had with its foreign affiliate. Here, the Petitioner's primary objective was to operate as a 
restaurant business, which it ~as not ready to do at the time the petition was filed. Rather, the 
Petitioner provided evidence indicating that the Beneficiary's primary focus at the time of filing was 
to prepare the restaurant to become operable and commence doing business several months after 
filing in either "late summer or early [ f]a'll of 2016." Despite the Beneficiary's effort in taking steps 
to meet this objective, the Petitioner was not providing its services as a restaurant at the time the 
petition was filed. 
Therefore, upon review of the petition and the evidence of record, including materials submitted in 
support of the appeal, we concur with the Director's finding that the Petitioner did not establish that 
it was doing business for the previous year and therefore did not meet the applicable regulatory 
provision at 8 C.F.R. § 214.2(1)(14)(ii)(B). 
B., U.S. Employment in a Managerial or Executive Capacity 
The Director also denied the petition based on the finding that the Petitioner did not establish that the 
Beneficiary will be employed in a managerial or executive capacity. The Petitioner does not claim 
that the Beneficiary will be employed in a managerial capacity. Therefore, we restrict our analysis 
to whether the Beneficiary will be employed in an executive capacity. 
Employment in an "executive capacity" entails "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; 
4 
Matter «f S-G- Inc. 
(ii) establishes the goals and policies of the organization, component, or function; 
(iii) exercises \vide 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. 
Section 10l(a)(44)(B) of the Act, 8 U.S.C. § 1101(a)(44)(B). If staffing levels are used as a factor in 
determining whether an individual is acting in a managerial or executive capacity, U.S. Citizenship 
and Immigration Services (USCIS) must take into account the reasonable needs of the organization, 
in light of the overall purpose and stage of development of the organization. See section 
101(a)(44)(C) ofthe Act. 
In the present matter, the Petitioner claimed one employee - the Beneficiary - and a negative annual 
income at the time the petition was filed. At part 5, no. 15 of the petition, the Petitioner referred to 
itself as a "startup" and claimed that its annual gross income is $500,000, an amount that is 
consistent with the foreign entity's capital contribution towards the Petitioner's new office 
operations. In support of the petition, the Petitioner provided a cover letter, which discussed the 
Petitioner's plan to operate a restaurant chain in Southern California and included a list of 34 job 
duties and responsibilities that would be assigned to the Beneficiary in his proposed position as the 
Petitioner's president. In reviewing the list, we note that a number of duties and responsibilities are 
premised on the underlying understanding .that the Petitioner must be staffed with the employees 
who would comprise the departments and teams that the Beneficiary would lead and coordinate; 
implement the staffing policies and sales plans that the Beneficiary would oversee and devise; and 
relieve the Beneficiary from having to perform the Petitioner's_various operational tasks involved in 
running a restaurant operation. Based on the information otiered in the petition, the Petitioner's sole 
employee was the Beneficiary himself and thus the Petitioner did not have the employees to: ( 1) 
staff the teams and departments that would comprise the U.S. entity; (2) implement the policies and 
procedures the Beneficiary would create in his discretion; and (3) carry out the Petitioner's 
nonexecutive operational tasks. 
Accordingly, the Director's RFE pointed to the lack of evidence establishing that the Beneficiary 
would be employed in an executive capacity. Specifically, the Petitioner was instructed to provide, 
in part, a statement describing the job duties the Beneficiary performed during the prior year and 
those he would perform under an extended petition. The Petitioner was also asked to provide a 
description of its staffing and evidence of its financial status to establish that the Petitioner is able to 
support the Beneficiary and elevate him to an executive position. 
The Petitioner's response includes a statement in which the Petitioner provided the follmving 
description of the job duties the Beneficiary performed over the previous year: 
Not only was [the Beneficiary] to run the [Petitioner], he was also tasked \Vith finding 
a location for their first restaurant ... and setting up the design, construction and 
5 
]\;fatter C!f S-G- Inc. 
hiring of personnel, which is still in the process of completing [sic]. He has been 
overseeing the market research, lease, design, construction negotiation, executive­
and managerial-level hiring, development and the continuous improvement of 
corporate policies, including regarding employment, vendor relations, menu design, 
and marketing, all balancing operational expenses against revenues in order to ensure 
the long-term success~of ... the foreign parent company's investments in [the] 
Petitioner. 
The Petitioner also stated that the Beneficiary has conducted research and visited sites to find the 
right location for its first restaurant, which the Petitioner stated was in the building process at the 
time of the RFE response. The Petitioner claimed that the Beneficiary has been involved in 
developing its long-term business goals, determining company structure, preparing and monitoring 
the annual budget, overseeing office and restaurant staffing, and coordinating the activities of the 
design and construction personnel. Although the Petitioner provided resumes for potential future 
hires, it neither claimed nor provided evidence to establish that it employed anyone other than the 
Beneficiary at the time the instant petition was filed. We further note that the Petitioner's projected 
hires include three staff members - a human resource specialist, a marketing manager, and an 
accountant - to be hired to work at the headquarters office along with five restaurant employees - to 
include hosts, hostesses, and servers- at each of the Petitioner's four projected restaurant locations. 
The Petitioner made no mention of hiring a chef or other kitchen staff to prepare the food that would 
be served to the restaurants' patrons, thereby leaving us to question who would carry out the food 
preparation duties that would make the restaurant operable. 
With regard to the Beneficiary's job duties going forward, the Petitioner indicated that the 
Beneficiary would be responsible for the Petitioner's sales leadership, strategy, and operation and 
that he would assume a leadership role with regard to the Petitioner's stati and finances. To the 
extent that a number_9fthe Beneficiary's duties would be directly related to an underlying staff, who 
would carry out the Petitioner's nonexecutive functions, it does not appear that the job description 
'contained in the RFE response was accurate based on the Petitioner's underdeveloped organization 
and overall lack of a support staff at the time the petition was filed. 
The Director determined that the evidence of record does not support the conclusion that the 
Beneficiary would be employed in an executive capacity. In making this determination, the Director 
relied, in part, on the Petitioner's organizational structure, which shows that the Beneficiary was the 
only employee at the time of filing and therefore was likely allocating his time primarily to 
nonexecutive job duties. While the Director acknowledged the Petitioner's plans to staff its 
organization \\ith employees, she declined to take the projected hires into consideration, stating that 
the Petitioner must establish eligibility at the time of filing. 
, Upon review of the petition and the evidence of record, including materials submitted in support of 
the appeal, we conclude that the Petitioner has not established that the Beneficiary would be 
employed in an executive capacity. 
6 
Matter ofS-G- Inc. 
The definition of executive capacity has two parts. First, the Petitioner must show that the 
Beneficiary would perform certain high-level responsibilities. Champion World. Inc. v. INS, 940 
F.2d 1533 (9th Cir. 1991) (unpublished table decision). Second, the Petitioner must prove that the 
Beneficiary would primarily be engaged in executive duties, as opposed to ordinary operational 
activities alongside the company's other employees. See Family Inc. v. USCJS, 469 F.3d 1313, 1316 . I 
(9th Cir. 2006); Champion World, 940 F.2d 1533. 
Accordingly, when examining the executive capacity of the Beneficiary, we will look first to the 
description of the job duties. See 8 C.F.R. § 214.2(1)(3)(iv). Published case law has determined that 
the duties themselves will reveal the true nature of the beneficiary's employment. Fedin Bros. Co .. 
Ltd. v. Sava, 724 F. Supp. 1103, 1108 (E.D.N.Y. 1989), affd, 905 F.2d 41 (2d. Cir. 1990). 
As noted previously, we find that certain key elements of the Beneficiary's proposed job description 
as presented in the RFE response- particularly those job duties that reference teams, departments, or 
any other underlying staff who would perform the Petitioner's daily operational and administrative 
tasks - were largely inapplicable to the Beneficiary's position at the time of filing, given that the 
Beneficiary comprised the Petitioner's entire organization. Thus, any aspect of the Beneficiary's job 
that would require an underlying support staff was purely speculative at the time of filing, as the 
Petitioner was not yet operational as a restaurant business and employed no office or restaurant staff. 
As stated earlier in our discussion, we may not approve a visa petition based on speculation of future 
eligibility or after the Petitioner or Beneficiary becomes eligible under a new set of facts. See, e.g, 
Matter ~f Michelin Tire Corp., 17 I&N Dec. 248. 
Further, 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, 8 U.S.C. § 1101(a)(44)(B). 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 the 
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." !d. 
In the present matter, the record shows that at the time ~f filing the Petitioner was not comprised of a 
complex organizational hierarchy in that it did not have a tier of managerial employees - or any 
other support staff- through whom the Beneficiary could be expected to direct the management of 
the organization and who would elevate the Beneficiary's position to that of an executive. Rather, 
the organizational chart in the record shows that all of the positions that would eventually comprise 
the organization were projected to be filled after the filing of the petition. Therefore, despite the 
Petitioner's business plan, which also anticipates the future hiring of employees to staff the 
., 
Matter of S-G- Inc. 
Petitioner's headquarters and restaurants, a determination of the Petitioner's eligibility must be based 
on the facts and circumstances that existed at the time the petition was filed. See, e.g., Matter of 
]1.1ichelin Tire Corp., 17 I&N Dec. 248. 
Further, while the Petitioner's circumstances may help explain why the Beneficiary was its only 
employee at the time of filing, such circumstances do not excuse the Petitioner from having to meet 
statutory and regulatory provisions, which require the Petitioner to establish that it had the staffing 
capability to relieve the Beneficiary from having to allocate his time primarily to nonexecutive job 
duties at the time the petition was filed. We note that the Petitioner's organizational needs do not 
supersede the Petitioner's evidentiary burden of having to establish that it was ready and able to 
employ the Beneficiary in an executive capacity at the time of filing. A visa petition may not be 
approved at a future date after the Petitioner or Beneficiary becomes eligible under a new set of 
facts. See id. at 249. 
On review, the record as presently constituted is not persuasive in demonstrating that the Beneficiary 
will be employed in an executive capacity as defined by the regulations. Despite providing a 
business plan that projects hiring a staff of three professionals as well as restaurant employees at 
each ofthe Petitioner's future restaurant locations, the regulation at 8 C.F.R. § 214.2(1)(3)(v)(C) only 
allows the intended United States operation 1 year within the date of approval of the petition to 
support an executive or managerial position. There is no provision in USCIS regulations that allows 
for an extension of this 1-year period. If the business does not have the necessary staffing after 1 
year to sufficiently relieve the Benefidary from performing operational and administrative tasks, the 
Petitioner is ineligible by regulation for an extension. In the present matter, the Petitioner neither 
claimed nor provided evidence to show that it employed a subordinate level of employees or had 
contractors to perform operational and administrative tasks at the time the petition was filed. 
Therefore, the Petitioner did not provide evidence to establish that it was ready to employ the 
Beneficiary in an executive capacity at the end of its first year of operation. 
As indicated above, a subordinate level of managerial employees is inherent to the definition of 
executive capacity, as this management tier, along with other employees and/or contractors who 
would perform the organization's operational and administrative tasks, and who would elevate the 
Beneficiary's role within the organization to that of an executive whose primary concern would be to 
direct the management of the organization and focus on the organization's broad goals and policies 
rather than its day-to-day operations. 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. Se"e also, sections 101(a)(44)(A) and (B) of the Act (requiring that 
one "primarily" perform the enumerated managerial or executive duties); Matter of Church 
Scientology International, 19 I&N Dec. 593, 604 (Comm'r 1988). In light of the Petitioner's lack of 
employees to staff its organization, we cannot conclude that the Petitioner had the ability to relieve 
the Beneficiary from having to allocate his time to primarily operational and administrative tasks. 
Therefore, the Petitioner was not ready to employ the Beneficiary in an executive position at the 
time the Petition was filed. 
8 
Matter of S-G- Inc. 
III. CONCLUSIO~ 
We will deny the petition and dismiss the appeal for the above stated reasons, with each considered 
as an independent and alternative basis for the decision. In visa petition proceedings, the petitioner 
bears the burden of proving eligibility for the benefit sought. Section 291 of the Act, 8 U.S.C. § 
1361. Here, that burden has not been met. 
ORDER: The appeal is dismissed. 
Cite as Matter ofS-G-lnc., ID# 139097 (AAO Jan. 23, 2017) 
9