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Precedent of AAO Clarifies Interpretation of “Doing Business” for EB-1C
      Browse: 3848      Date: 05-06-2015

On April 9, 2015, the administrative appeals office (AAO) published a precedent decision: Matter of Leacheng International, Inc. This precedent clarifies the definition of “doing business” for EB-1C, immigrant petition for multinational manager or executive.

The petitioner, Leacheng International, Inc., established in 2008, is a U.S. affiliate of the beneficiary’s former Hong Kong employer. Both companies are owned by their parent company, a Chinese clothing manufacturer. The petitioner filed an immigrant petition for an alien worker with United States Citizenship and Immigration Services (USCIS), seeking to employ the beneficiary as a deputy general manager. The petitioner was engaged in the business of importing and selling the parent company’s products to its U.S. customers, primarily major clothing retailers through 2011. However, beginning January 2012 the petitioner started providing sales and marketing services to its Hong Kong affiliate including marketing the affiliate’s products, locating buyers, expanding its customer base, maintaining customer relations, after-sales services, etc. pursuant to a service agreement. In support of the petition, the petitioner provided a copy of the service agreement along with all the invoices billed to the foreign affiliate exceeding $4.1 million in 2012.

The petition was denied by USCIS on the ground that the petitioner’s evidence does not support that it had been doing business with independent corporations or entities for a full year before filing the petition.

The petitioner appealed, asserting that according to 8 C.F.R. § 204.5(j)(2) (2014), "doing business means the regular, systematic, and continuous provision of goods and/or services by a firm, corporation, or other entity and the regulatory definition does not require that it "be a direct party to contracts or a direct provider of goods and services to a U.S. customer".

The key issue of this case is the interpretation of “doing business” applicable to immigrant multinational manager and executive petitions. AAO clarifies that the definition of “doing business” contains no requirement that a petitioner for a multinational manager or executive must provide good or service to an unaffiliated third party. AAO reverses the decision by the Director of Texas Service Center with the conclusion that a petitioner may establish that it is “doing business” by demonstrating that it is providing goods and/or services in a regular, systematic, and continuous manner to related companies within its multinational organization. In reaching its conclusion, AAO finds that the fact that a petitioner serves as an agent between a related foreign entity and its US customers does NOT preclude a finding that it is doing business as defined in the regulations.

Comments from Our Office
Notwithstanding the trend that USCIS has become stricter and stricter in processing EB-1C petitions, this precedent of AAO is clearly a victory to the immigration community regarding multinational manager and executive petitions.