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QUALIFYING COMMON OWNERSHIP FOR "L-1" VISA ISSUANCE

In order for a company to transfer an employee to the United States as an "L-1" Intracompany Transferee, there must be "common ownership" between the U.S. company and the overseas company, either as a branch office, or in a subsidiary or an affiliated relationship. Subsidiary and affiliate, for purposes of "L-1" visa issuance, are defined as:

SUBSIDIARY. A subsidiary is:

  1. A firm, corporation, or other legal entity of which a parent company owns, directly or indirectly, more than half of the entity and controls the entity; or

  2. A firm, corporation, or other legal entity of which a parent company owns, directly or indirectly, half of the entity and controls the entity; or

  3. A firm, corporation, or other legal entity of which a parent company owns, directly or indirectly, 50 percent of a 50-50 joint venture and has equal control and veto power over the entity; or

  4. A firm, corporation, or other legal entity of which a parent company owns, directly or indirectly, less than half of the entity, but in fact controls the entity.

As a practical matter, what does this mean to the issuance of an "L-1" visa?

  1. If the overseas corporation owns 100% of the shares of the U.S. corporation, an "L-1" visa will be issued.

  2. If the overseas corporation owns half of the shares of the U.S. corporation, and controls the U.S. entity, an "L-1" visa will be issued.

  3. If the overseas company owns half of a joint venture and the other joint venturer controls the joint venture company equally, employees of both joint venture parent companies will receive an "L-1" visa.

  4. If the overseas company owns less than half of a joint venture, but in fact controls the joint venture U.S. company, then an "L-1" visa will be issued to the controlling company.

AFFILIATE. An affiliate is:

  1. One of two subsidiaries, both of which are owned and controlled by the same parent company or individual person; 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; or

  3. Certain accounting, managerial and/or consulting services, formed as a U.S. partnership, marketing under an internationally recognized name, under an agreement with a worldwide coordinating organization that is owned and controlled by the member accounting firms. (In other words, the "big eight" accounting firms.)

As a practical matter, what does this mean to the issuance of an "L-1" visa?

  1. If the overseas corporation is owned by a group of individuals, then that same group of individuals must own shares in approximately the same share or proportion in the overseas company as they do in the U.S. company, an "L-1" visa will be issued.

  2. If all members of the group are not represented in the U.S. company there is no common ownership and an "L-1" visa will not be issued.

  3. If an individual shareholder owning less than 100% of the shares of an overseas company comes to the United States and forms a U.S. corporation, 100% owned by him, or by himself and others not part of the ownership of the overseas company, an "L-1" visa will not be issued.

Additional resources provided by the author

See our web site at www.inteconlaw.com and call us for a free telephone consultation at (949) 833-8021. Law Offices of David D. Murray handles immigration cases across the USA and around the world.

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