A foreign business entity or individual seeking to do business in the U.S. should assess the applicable immigration laws at the earliest opportunity. The question of U.S. immigration is a threshold issue, for the very reason that the laws do not accommodate all foreign persons seeking to work in the U.S. Furthermore, traveling to the U.S. without an understanding of the criteria for the various options that do exist can result in a costly mistake, which might jeopardize the viability of a fledgling U.S. entity. However, with careful consideration of the immigration alternatives and strategies for both the short- and long-term at the time of market assessment, the vast majority of situations can be accommodated.
Considerations When Assessing the U.S. Market
Business persons seeking to enter the U.S. for the purpose of assessing the market may generally do so as Business Visitors on the B-1 visa. This visa is suitable for persons who desire to enter the U.S. on behalf of their foreign employer for the purpose of conducting business meetings with prospective customers. Research on U.S. market conditions with respect to a possible investment may also be carried out on this visa, providing the research is to be utilized by the foreign entity for analysis of market conditions. Productive employment for a U.S.-based entity is not permitted. B-1 visa holders must maintain their permanent residence outside of the U.S. and may not receive any compensation from a U.S. source, although the reimbursement of expenses that are incidental to the trip may be undertaken by a U.S. entity.
B-1 Business Visitors are generally admitted to the U.S. for an initial period of six months, and extensions of stay are possible providing the above criteria are still satisfied. Citizens of some 35 countries (primarily those of Western Europe, Japan, Australia and New Zealand) may apply for admission to the U.S. without a B-1 visa on the so-called Visa Waiver Program (VWP), provided they otherwise qualify for a B-1 visa and desire to remain in the U.S. for no longer than 90 days. Prior to traveling to the U.S., the visa waiver traveler must apply for and obtain an ESTA travel authorization at www.cbp.gov, and travelers on the VWP must be in possession of a return ticket at the time of admission to the U.S. Note that no extensions of stay are permitted for business visitors on the VWP.
Considerations When Establishing the Business
The B-1 visa also permits the holder to establish a U.S. business enterprise. This can include instructing lawyers to incorporate a U.S. entity and generally attending to most aspects of the start-up phase of the entity. For example, the visitor may sign a lease for premises on behalf of the new U.S. entity and enter into contracts with customers and vendors. However, permitted transactions do not include working for the U.S. entity and the actual fulfillment of these contracts, since such activities may be regarded as local labor for hire for which a work visa is required. Again, citizens of the same 35 countries may engage in the establishment of an U.S. business enterprise on the VWP, providing the activities in question can be carried out within the 90-day period.
Nonimmigrant Work Visa Options
U.S. Immigration law offers a number of options that permit temporary work in the U.S. These alternatives have different eligibility criteria and their availability depends on the facts and circumstances of each situation. It is possible for an individual to be qualified for more than one option, and the final selection depends on the nature of the activities to be undertaken and the qualifications of the individual.
The L-1 Intracompany Transferee Visa
The L-1 intracompany transferee visa is available to executives, managers and specialized knowledge personnel, who are to be transferred from a foreign entity to a U.S. parent, branch, subsidiary or affiliate. The transferee must have worked for the foreign entity in an executive, managerial or specialized knowledge capacity for at least one full year in the three year period prior to transfer to the U.S. There is no nationality restriction or quota imposed on intracompany transferees. The maximum period of stay for executives and managers is 7 years. Specialized knowledge personnel are limited to a maximum of 5 years.
Before the L visa can be applied for at the U.S. consulate, the U.S. employer must file a petition with United States Citizenship and Immigration Services (USCIS) in the U.S. This petition must include documentation confirming the nature of the relationship between the transferor and transferee entities, as well as details of the responsibilities of the person to be transferred. Processing of the petition by USCIS generally takes a few weeks.
The petition filed with USCIS may request an initial period of eligibility of up to three years. However, in new office situations (where the U.S. office has been in existence for less than one year), the maximum period of initial petition validity is one year. For such start-up situations, USCIS will also need to review the relevant documentation pertaining to the entity's formation, including its lease of premises and business plan. Such petitions may be extended beyond the one year period of initial validity, providing the entity can clearly demonstrate its financial viability and ability to continue the employment of the transferee in the relevant executive, managerial or specialized knowledge capacity.
A business that has been operating in the U.S. for at least one year and is a member of a multinational organization with U.S. sales in excess of $25 million or has more than 1,000 employees may petition USCIS for L-1 blanket designation. This L blanket program is one of the most important nonimmigrant options available to multinational companies, since L visa applications for executives, managers and specialized knowledge professionals may be submitted directly to the U.S. consulate, without the necessity of having to file an individual petition with USCIS for each transferee or to prove that a qualifying relationship exists between the transferor and transferee entities.
The E Treaty Visa
The E Treaty visa is available to citizens of certain countries that have entered into specific treaties and investment agreements with the U.S. Most of the European countries have such treaties, and other countries include Canada, Mexico, Japan, Australia and New Zealand. The E-1 visa is available to treaty traders and the E-2 to treaty investors. Note that the E visa is available to individual entrepreneurs, as well as to employees of treaty trading or investing entities. In employee situations, it must be demonstrated that the U.S. entity that will employ the visa applicant shares the nationality of the individual to be employed. Nationality of the U.S. entity is determined not by the place of its incorporation or place of business, but by the nationality of 50% of the ultimate owners of the entity. In situations where the ultimate parent company is publicly owned, the entity is generally presumed to be a citizen of the country where its shares are principally traded.
Once the nationality requirement for the employing entity and the visa applicant has been satisfied, it must also be demonstrated that the employing entity in the U.S. is engaging in substantial trade between the U.S. and the treaty country or constitutes a substantial investment by the treaty entity. For trade purposes, substantiality is demonstrated by the frequency of the transactions. For investment purposes, there is no set dollar figure which makes any investment substantial but, in general terms, the amount invested should be sufficient to ensure the financial viability of the business in question. Marginal investments that will do little more than provide a means of living for the investor will not qualify.
Unlike the L-1 visa, no visa petition needs to be filed with USCIS and no prior employment with the business entity overseas is required. The application is filed directly with the U.S. consulate in the treaty country. The visa is generally valid for an initial period of four or five years for executives and managers (depending on the country) and two years for persons with essential skills. The E visa may generally be extended without outer limit.
H-1B Visa
The H-1B visa is available to specialty occupation workers who will work in a professional field. The visa presupposes that the job in question requires the achievement of the minimum of a Bachelor’s degree in a particular field and that the foreign national possesses such a degree. The U.S. employer must file a petition with USCIS and the petition must be accompanied by an approved Labor Condition Application from the Department of Labor, indicating, among other things, that the wages offered to the foreign national will not be less than the wages paid to similarly situated workers at the job site and generally in the local area of employment. The H-1B visa program is currently subject to a quota of 65,000 visas per year, plus an additional 20,000 visas available to foreign nationals holding U.S. Master's Degrees.
The H-1B visa is valid for an initial period of up to three years and can be extended for a maximum of six years, with limited exceptions.
Working Spouse Issues
Spouses of E, J and L visa holders in derivative status may apply for an Employment Authorization Document by filing Form I-765 with USCIS. Derivative spouses in H-4 status are not eligible to apply for employment authorization.
To obtain a copy of Gibney's booklet on Starting a Business In the U.S., please e-mail us at imminfo@gibney.com
