dismissed L-1A Case: Retail

U.S. Citizenship 
and Immigration 
Services 
MATTER OF D-G- INC. 
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: APR. 17,2018 
APPEAL OF CALIFORNIA SERVICE CENTER DECISION 
PETITION: FORM 1-129, PETITION FOR A NONIMMIGRANT WORKER 
The Petitioner, a clothing and art store, seeks to temporarily employ the Beneficiary as director of 
sales of its new otlice 1 under theL-IA nonimmigrant classification for intracompany transferees. 
See Immigration and Nationality Act (the Act) section IO!(a)(IS)(L), 8 U.S.C. § IIOI(a)(IS)(L). 
TheL-IA classitication allows a corporation or other legal entity (including its atliliate or subsidiary) to 
transfer a qualifying foreign employee to the United States to work temporarily in a managerial or 
executive capacity. 
The Director of the California Service Center denied the petition, concluding that the record did not 
establish, as required, that the new oftice would support a managerial or executive position within 
one year after approval of the petition. 
The matter is now before us on appeal. In its appeal, the Petitioner submits additional evidence and 
asserts that the Beneficiary is already performing in a managerial or executive capacity. 
Upon de novo review, we will dismiss the appeal. 
I. LEGAL FRAMEWORK 
To establish eligibility for the L-1 A nonimmigrant visa classification in a petition involving a new 
office, a qualifying organization must have employed the beneficiary in a managerial or executive 
capacity for one continuous year within three years preceding the beneficiary's application for 
admission into the United States. 8 C.F.R. § 214.2(1)(3)(v)(B). 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 or executive capacity. !d. 
The petitioner must submit evidence to demonstrate that the new office will be able to support a 
managerial or executive position within one year. This evidence must establish that the petitioner 
1 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(l)(l)(ii)(F). The regulation at 8 C.F.R. § 214.2(1)(3)(v)(C) allows a "new office" operation no 
more than one year within the date of approval of the petition to support an executive or managerial position. 
Malter of D-G- Inc. 
secured sufficient physical premises to house its operation and disclose the proposed nature and 
scope of the entity, its organizational structure, its financial goals, and the size of the U.S. 
investment. See generally, 8 C.F.R. § 214.2(1)(3)(v). 
II. DEFINITIONS 
"Managerial capacity" means an assignment within an organization in which the employee primarily 
manages the organization, or a department, subdivision, function, or component of the organization; 
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; has authority over personnel actions or functions at a senior level within the 
organizational hierarchy or with respect to the function managed; and exercises discretion over the 
day-to-day operations of the activity or function for which the employee has authority. Section 
IOI(a)(44)(A) of the Act. 
"Executive capacity" means an assignment within an organization in which the employee primarily 
directs the management of the organization or a major component or function of the organization; 
establishes the goals and policies of the organization, component, or function; exercises wide 
latitude in discretionary decision-making; and receives only general supervision or direction from 
higher-level executives, the board of directors, or stockholders of the organization. Section 
IOI(a)(44)(B) of the Act. 
Based on the statutory definitions of managerial and executive capacity, the Petitioner must first 
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). Second, the Petitioner must prove 
that the Beneficiary will be primarily engaged in managerial or 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. 
Ill. MANAGERIAL OR EXECUTIVE POSITION 
The Director concluded that the Petitioner did not establish that the new of1ice would support a 
managerial or executive position within one year. The Director based this conclusion largely on a 
finding that the Beneliciary's duties would not be primarily those of a manager or executive, and 
that the company's proposed stalling was not adequate to support such a position. The Petitioner 
asserts on appeal that the Beneficiary is already acting in such a capacity. We disagree. 
A. Duties 
When examining the managerial· or executive capacity of the Beneficiary, we will review the 
Petitioner's description of the Beneficiary's 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 
arc in a managerial or executive capacity. See 8 C.F.R. § 214.2(1)(3)(ii). In this instance, the 
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Matter of D-G- Inc. 
Petitioner has not specified whether the position would be managerial or executive; the Petitioner 
has consistently used both terms. 
The Petitioner provided the following description for the director of sales position: 
\ 
[The Beneticiary] is primarily responsible for motivating and energizing the staff to 
make proactive decisions in all their communications with clients; creating and 
advertising weekly, monthly and quarterly sales goals; preparing sale reports and 
signing otT on their accuracy before submitting them; assessing the competitive 
landscape and instituting changes to sales program in response to competitor' [s] 
changes; establishing a referral network with international and local business as well 
as finding ways to maximize value from those connections; implementing a sales 
training and orientation program to educate new hires as our company grows. 
The table of Beneficiary's estimate of the percentage of time is dedicated to each 
specific duty. The beneficiary's main duties as Director of Sales include, but [are] 
not limited to the following: 
A. Investigate and sun•ey market area; Report and communicate to parent 
company in China [30% of her time] 
[The Beneficiary] needs to assign the manager to monitor and research about the 
characters, patterns and trends of [the] local market . . . . She is responsible for 
reports and communications to ... the parent company ... regarding the results of the 
market research and marketing research. 
B. Draw up marketing plans; Make timely sales summaries; Evaluate sales 
(30% of her time] 
(The Beneficiary] sets goals, gross-profit plans and strategies on [a] weekly, monthly, 
quarterly and annual basis . . . . She has the authorization to adjust the goals and 
strategies ... [and] is responsible for proper and well-established communication 
with [the] General Manager for business proposals .... She executes and controls 
the proceedings of the strategies and goals of the company and develops (the] 
strategic plan .... She evaluates the status sales, analyzes trends and assigns staff to 
complete sales summaries based on the result of her supervision and observation. 
C. Set up outdoor sites and retail stores; Manage retail stores; Work out 
exhibition plans in lJ.S.; Assign exhibition work; Assist with local lJ.S. suppliers 
in development of company's products [20% of her time] 
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Mauer ofD-G- Inc. 
[The Beneficiary] has the authorization to decide the location of retail stores, products 
to display and sell, personnel to employ as well as other business-related matters. She 
makes policies and rules ... [and] is also responsible for exhibition plans . . . . She 
makes sure the suppliers meet the company's business development strategies .... 
Besides, she is in charge of the development of new products as well as 
communication with U.S. suppliers for the techniques used and design of the 
products .... 
D. Recruit and train sales executives [I 0% of her time J 
[The Beneficiary J has to ... select the most qualified personnel . . . . She assigns 
accountabilities and appraises job results of employees. She also coaches, orients, 
trains, counsels, monitors and disciplines executives and managers to ensure business 
goals are met. 
E. Executive Performance [10% of her time] 
. [The Beneficiary] is responsible for supervising the performance of the entire 
Department and leading the executives and managers to achieve goals [in a] timely 
manner by standardized procedures. 
The record does not support crucial claims inherent in the above job description. Organizational 
charts in the record do not show any executives under the Beneficiary's authority. The record does 
not provide further substantive information about the exhibitions mentioned in the job description. 
With respect to "development of [the] company's products," the record does not indicate that the 
Petitioner develops or manufactures its own products or has any employees with those 
responsibilities. The record also does not corroborate the assertion that the Petitioner has any ·input 
into the development or design of the products that it purchases from its suppliers. With respect to 
exhibitions, the revised organizational chart shows a still-vacant position for an event planner, but 
that individual is under the authority of the operations director, not the sales director. 
The Director denied the petition, stating that many of the Beneficiary's prospective tasks appear to 
be routine operational tasks rather than the duties of a manager or executive. 
On appeal, the Petitioner asserts that the Beneficiary's duties are "absolutely reasonable" and that 
the Director did not take the submitted evidence into consideration. The Petitioner states that the 
Beneficiary "is authorized to perform top level function[s]" such as signing the lease on the retail 
space, and that "she is usually on [site] to supervise employees." The Petitioner indicates that the 
Beneficiary is already running the sales department, presumably without compensation because her 
B-2 nonimmigrant status does not permit employment in the United States. 
The Petitioner asserts that, because the company is still in the start-up phase, the Beneficiary also has 
responsibility over "operation and finance fimctions." In a new of1ice petition, the Petitioner must 
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Mauer of D-G- Inc. 
establish what the Beneficiary's role will be at the end of the first year, once the company is more 
fully operational. The Petitioner cannot meet this burden through short-term responsibilities that the 
Beneficiary has assumed purely because key positions are unstaffed. 
Even granting that a new office is not fully operational, the Petitioner must provide sufficient 
information to show that the new office will support a managerial or executive position within a 
year. In this instance, beyond delays documented in the record, the Petitioner's plans appear to be 
insufficiently developed. The Petitioner states that it is normal for plans to change as a new business 
grows and develops, but the deficiencies in the record go beyond these usual parameters. As 
discussed further below, the Petitioner has set forth ambitious but poorly detailed plans, with little 
concrete information about how the company intends to realize those plans. 
The Petitioner has established that the Beneficiary will have discretionary authority over its sales 
department, but not that the Beneficiary's duties will be primarily those of a manager or executive. 
B. Staffing 
The position description alone is insufficient to establish that a beneficiary's duties would be 
primarily in a managerial or executive capacity, particularly in the case of a new office petition 
where much is dependent on factors such as a petitioner's business and hiring plans and evidence 
that the business will grow sufficiently to support a beneficiary in the proposed position. A 
petitioner has the burden to establish that it would realistically develop to the point where it would 
require the beneficiary to perform duties that are primarily managerial or executive in nature within 
one year. Accordingly, the totality of the evidence must be considered in analyzing whether the 
proposed duties are plausible considering a petitioner's anticipated staffing levels and stage of 
development within a one-year period. See 8 C.F.R. § 214.2(1)(3)(v)(C). 
The statutory definition of "managerial capacity" allows for both "personnel managers" and 
"function managers." See sections IOI(a)(44)(A)(i) and (ii) of the Act. Personnel managers are 
required to primarily supervise and control the work of other supervisory, professional, or 
managerial employees. The statute plainly states that a "flrst 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 IOI(a)(44)(A) of the Act. If a petitioner claims 
that a beneficiary directly supervises other employees, those subordinate employees must be 
supervisory, professional, or managerial, and the beneficiary must have the authority to hire and tire 
those employees, or recommend those actions, and take other personnel actions. Sections 
101(a)(44)(A)(ii)-(iii) of the Act. 
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 10l(a)(44)(A)(ii) of the Act. The Petitioner has not stated that 
the Beneficiary will be a function manager, nor has the Petitioner articulated a specific function that 
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Malter of D-G- Inc. 
the Ben cticiary will manage . Instea d, the Petitioner has focused on the Beneficiary's author ity over 
sales and othe r personnel. 
The Petit ioner stated that it has "hired and trained a tew employees and set the company's basic 
structur e," consisting of " Sal es, Operations and Finance Departm ents." This structu re is consis tent 
with the Petitioner's organi zationa l charts, whi ch show appro xima tely 10 posi tions to be fi lled in 
these departments. Howev er, the Petitioner's "Employment Plan" (included in its bus iness plan), 
indicat es that the company will have a much different structure, including a creative department, a 
brandin g depar tment a merchandise display department , a mark eting department, and a retail store 
depa rtm en t, with up to 20 or more total employees, durin g t he first year. The Petitio ner did not 
consistently describe its inte nde d structure or the numb er of employees to be hired . A lthoug h the 
Petition er later submitted a revised employment plan that was more in line with its proposed 
organization al chart, it did not indicate who would be performing the duties atrributed to the staff 
identified in the original empl oymen t plan. 
The Petitioner stated that the Beneficia ry "will work under the CEO [chief execut ive ofticer], and 
will direc tly s uperv ise the Sales Manager ... , as we ll as a Sales Team curre ntly being recr uited." 
The Petiti oner indicated that the sales manager would manage sales staff"a nd retail stores." 
When the Petitioner filed the petition in October 2016, it indicat ed that it had opened one store 
location in and planned to open a seco nd store in June 2017 , and a 
in December 2016. During this first year, howeve r, the Petitioner projected employing 
only "I to 2" store ma-nagers. (The Petitioner planned to open additional stores in and 
elsewhere after the first year.) · 
The Direct or adv ised that the Petitioner had not es tablished that it " will have an orga nizationa l 
structure sufficien t to elevat e the beneficiary to a position that is primarily executive in nature." In 
response, the Petit ioner submitt ed a reformatted business plan. Like the earlie r version , the seco nd 
business plan ind icated that the Petitioner would ope n a in December 2016. 
The Petiti one r submitted this seco nd busin ess plan in .July 2017, severa l m ont hs after that target date , 
but the Petitioner did not establis h that the site 1-iad ope ned as planned (or provide much information 
about the nature of the or its projected statling requirements) . 
The revi sed business plan listed the sales 1nanager's duties: " Follow Director's instructions. 
Overse[e] sa lespeo ple. Develop sales strategies and plans. Set targets for the sales team and manage 
their performance. Prepa re sale[s] repor ts [for] Director." The Petitioner add ed: "Educat ion Leve l: 
Bache lor and /or Above." 
The organizat ional chart sub1~1itted in July 2017 identified as the sales manager; pay 
receipts showed part-time employment of 10 to IS hours per week. The same cha rt named 
as the full-time ope rations manager, outside the Beneficiary's line of authority . 
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Matter of D-C- Inc. 
In the denial notice, the Direct or found that the Petitioner had not establi shed that the Beneficiary 
would supervise manager s, superv isors, or profe ssio nals. On appe al, the Petitioner asserts that, as "a 
newly founded company," the Petitioner's structure is not yet fixed. 
The Petitioner mu st establish eligibilit y at the time of tiling. See 8 C.F.R. § 103. 2(b)( l). The new 
office need not be fully staffed or operational at the time of fi ling, but the Petition er mus t p rovide 
enough evidence and information at the time of tiling to show that a primarily manage rial or 
executive position will exist within a year. 
A new organi zational chart submitted on appeal in September 201 7 showed as the sales 
manag er and as the sa les team leader. By this time , the Petiti oner had hired two a dditional 
sales personnel. Pay receipts from August 2017 , nearly ten mon ths afte r the filing date, showed that 
was the only full-time employee in the department. The Petitioner has not established that 
three part-time sales worker s would require or justify an additi ona l level of manageri al authority 
above their full-time superviso r. While the Petition er plans to open additional stores, the Petitioner 
has not show n that this would occur within the one- yea r timeframe of a new otlic e. 
Oversight ove r supervisors may qualify as managerial, but the Petitioner has not established that the 
Beneficiary' s s upervision of would occupy enough of her time to qualify as one o f her 
primary responsibilities·. We have already identified various probl ems with the Petitioner's 
breakdown of the Beneticiary 's claimed duties. 
To detem1in e w hether the Beneficiary manag es professional empl oyees , we must eva luate whet her 
the subordinate position s requir e a baccalaureate degree as a minimum for entr y into the field o f 
endeavor. Cf 8 C.F.R. § 204.5(k) (2) (defining "profe ssion" to mean "any occupation for which a 
United States baccalaureate degree or its foreign equivalent is the minim um requirem ent ·for entry 
into the occ upation"). Section I 0 I (a)(32) of the Act states that "[t]he term profession shall include 
but not be limi ted to archit ects, engi ne~rs, lawyer s, physicians, surgeon s, and teachers in elemen tary 
or second ary schools, colleges, academies , or seminaries." 
The Di rec tor found that the Petitioner had not established that the Beneticiar y's subordinate s arc 
profession als whose occupation requires at least a bachelor' s degree . On appeal, the Petitioner 
proposes a new definition of the term "professional," stating: "the so-call ed profes sional employees 
should be employees who have knowledge in sales, art and related fields." This is not a tenable 
definition of a "pro fessional " for the purpose s of determining the Benetic iary's eligibi lity as a 
personnel manage r; the term is not simpl y synonymous with "we ll-qua litied." 
Furthermor e, the Petitioner had previously claimed that the sales man ager post tton r equired a 
"Bachelor and/or Above." The Petitioner bas retre ated from this claim now tha t the sales ma nager is 
whose resume lists no education beyond a high school dipl oma. 
The Petitio ner has not shown that the Benetici ary will primarily · supervise man agers, supervisors, or 
profe ssionals durin g the tirst year after appro val of the petition. Therefore, the Petiti one r has not . . 
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Maller of D-C- Inc. 
established that it will employ the Beneficiary as a personnel manager during the time permitted for 
a new oftice. 
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 I 0 I (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 managerial employees for a beneficiary to direct and a beneficiary must 
primarily focus on the broad goals a(ld 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." !d. 
As we have already discussed, the 'Petitioner has not shown that the Beneficiary will direct the 
management of the petitioning entity or a major component or function thereof. The latest 
organizational chart shqws an operation manager under the authority of a director of operation. The 
Petitioner asserts that the position of director of operation remains vacant, so the Beneficiary also 
oversees the operation manager. This, however, is admittedly a short-term temporary arrangement 
in the absence of a director of operation, and therefore it does not show us the Beneficiary's 
expected authority once the company is fully established. Furthermore, the latest chart shows that 
every position subordinate to the operation manager is vacant, which means that the operation 
manager is the department's only employee. As such, that employee is unlikely to be functioning in 
a truly managerial capacity rather than performing the tasks that would otherwise be delegated to 
subordinates. 
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 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 IOI(a)(44)(C) of the Act. 
On appeal, the Petitioner states: "We expect to finish our recruitment for current locations in 20 18," 
more than a year atler the petition's. October 2016 filing date. The record indicates that the 
company's progression has been slower than anticipated, which further impedes any finding that the 
company would be able to fully support a primarily managerial or executive position within a year. 
IV. ADDITIONAL NEW OFFICE ISSUES 
Beyond the Director's decision, our de novo review of the record shows other issues relating to the 
new office petition requirements. 
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Maller of D-C- Inc. 
A petitioner seeking to open a new office must establish 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. 8 C.F.R. § 214.2(1)(3)(v)(C)(2). The Petitioner's business plan 
anticipated "$2 million dollars investment ... for 2016 to 2018:" The Petitioner initially 
documented $160,000 in incoming wire transfers from its parent company, which accounts for only 
8% of the anticipated investment in the company. The Petitioner later submitted a list of financial 
transactions, showing that in early 2017 the parent company carried a bank balance of around 9 
million yuan, roughly equivalent to $1.42 million in U.S. currency. The submitted evidence does not 
show that the foreign entity would be able to invest a further $1.84 million in the U.S. entity over the 
next two years, or that the company would be able to reach its stated development goals without that 
capital. 
Furthermore, the revised business plan and organizational chart submitted in July 2017 indicated that 
the Petitioner was recruiting warehouse staff under the Beneficiary's control "by June 2017." The 
Petitioner did not, however, show that it had secured warehouse space to employ such a stall. The 
only lease agreement documented in the record is for the Petitioner's first retail store. A new office 
petition anticipates that growth will occur after the petition's filing date. Still, the Petitioner must 
establish at the time of tiling that it has secured sutlicient physical premises to house its business 
operations. See 8 C.F.R. § 214.2(1)(3)(v)(A). If the Petitioner plans to hire warehouse workers, but 
has no warehouse, then it has not secured sutlicient physical premises to house its business 
operations. 
V. CONCLUSION 
The Petitioner has not established that its new office will support a managerial or executive position 
within a year after approval of the petition. The Petitioner has also not met new office requirements 
concerning financial support and physical premises. 
ORDER: The appeal is dismissed. 
Cite as Maller ojD-G- Inc .. ID# 958952 (AAO Apr. 17, 2018) 
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