We are Your Immigration Law Firm

About usTestimonialsContact us
Find this page interesting? Share it!  

Obtaining the EB-1 Green Card from L-1 Visa is Not Possible for Most Small Businesses

Many businesspeople, who plan to maintain a business in their home country, have started a small business in the U.S. with the plan to obtain permanent residence through the EB-1 Multinational Manager and Executive category. However, the vast majority of such people fail to reach the goal of obtaining permanent residence in this category. Why? The general answer is that USCIS’s decision track record in the EB-1 permanent residence and L-1 visa categories indicates that it believes that only the employees of large corporations are worthy of the green card in the EB-1 category, and eligible for extensions in the L-1 visa category. Owners and managers in small businesses need not apply. The specific answer is that in order to qualify, a manager must be at the head of a large managerial hierarchy with several levels of management between him or her and the front-line employees, including having multiple departments. The larger the staff and more complex the hierarchy, the better the manager’s chances of L-1 renewal and permanent residence through the EB-1 permanent residence category.

The case depends primarily on the very subjective and arbitrary determination by the USCIS examiner about whether the immigrant is performing a job that is “truly executive or managerial in nature.” USCIS examines this in light of the job duties stated in the petition, but also in light of how many employees work under the immigrant in the company’s managerial hierarchy. There need to be at least 2-3 levels of management between the immigrant and the front-line workers. Best case, also with several departments, each with a head, multiple levels of management and then the front-line workers at the bottom. If the hierarchy is viewed like a tree, then the immigrant’s chances of success are greatest if their hierarchy is shaped like a broad live oak tree with many limbs, branches, and leaves, than like a palm tree with a narrow trunk and a couple of levels of branches between the top and bottom.

There is no magic threshold number of employees that will make or break the case. That being said, I would figure on having no less that 10 employees, since USCIS does not want to undermine the EB-5 category by making the EB-1 category a cheap alternative to the EB-5 category. It is a matter of numbers and structure: a manager with a complex, multi-departmental structure with 10 employees might qualify, while a manager with 20 employees, but only 1-2 managers between him and 1-19 front-line employees would likely not qualify.

Sophistication of the business is important, as well. A business with a more sophisticated business activity and higher-skilled and educated workers is also more likely to succeed than a business involving low or unskilled labor. For instance, a small technology firm (still preferably with more than 10 employees) filled with university graduates has much greater chances than a lawn care business with unskilled workers (and likely a very un-departmentalized structure).

Although the statutes and regulations for the L-1 and EB-1 categories provide for “functional managers,” in practice, USCIS does not accept the functional manager concept, and so a manager without subordinates and a whole hierarchy beneath him or her has very slim chances of success.

Another factor for an entrepreneur to consider are the hidden costs of what, at first glance, appears to be a cheaper alternative to an investment of $500,000 to qualify under the EB-5 category. Most business owners under the L-1/EB-1 scenario end up dragging down the foreign business from not being able to devote enough time and supervision to it, while trying to build up and maintain the U.S. business. At the same time, if the U.S. business does not meet with initial success, it can bleed the entrepreneur financially, particularly in light of the fact that high staffing levels must be maintained just in order to hold onto the L-1 visa while building up to the point when the immigrant entrepreneur can apply for permanent residence.

When an investor entrepreneur establishes a new business in the U.S., he can obtain the L-1 visa for only 1 year, and is not eligible to apply for permanent residence under the EB-1 category until the business has been in existence for at least 1 year. In order to extend the L-1 at the end of the first year, the entrepreneur must have created at least 5+ jobs in order to have a chance at extending the L-1 visa. If he or she succeeds in extending the L-1 visa, then the clock is still ticking because the L-1 can be extended only up to a maximum of 7 years for an L-1 manager. Seven years seem like a long time, but it is not a long time for building a business large enough to employ 10+ workers. This is particularly the case if the business owner encounters obstacles such as an economic downturn or a shift in demand in the market, given that many products have a life-cycle of just a few years, particularly if they involve rapidly evolving technology.

The L-1/EB-1 multinational manager route is advisable just for those entrepreneurs who have already planned to expand their existing business into the U.S. market, have conducted extensive market research on the feasibility of succeeding on the U.S. market, and have plenty of additional financial resources to see the project through to successful completion in spite of inevitable obstacles and setbacks. Many entrepreneurs come to the U.S. with unrealistic expectations of what they can accomplish. Often they underestimate how competitive the U.S. market is. Alternatively, they think that the lack of a certain good on the U.S. market means that people will immediately realize what they have been missing and buy it, rather than understanding that there are a lot of resourceful businesspeople in the U.S., and if consumers were interested in that good, then someone else would already be selling it to them.

The L-1/EB-1 path to permanent residence can be travelled successfully, but the entrepreneur must be realistic, well funded, persistent, and possibly just lucky to be offering the right good or service at the right time and location.

Have Questions About Your Immigration Options?

Submit my inquiry
Call today!
+1 (941) 362-7100

Anthony Olson, P.A. - Sarasota Immigration Attorney 
2020 Cattlemen Road, Suite 100, Sarasota, FL 34232 See map 
Telephone:  +1 (941) 362-7100 
Website address: http://www.immigrationvisausa.com/ 
© 2017 All rights reserved 

Privacy Policy | Site Map

The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.