With the rise of remote work, it’s never been easier for companies to reduce their bricks-and-mortar footprint to keep costs down (and keep employees happy). A parallel benefit of workplace technology is that it’s made expanding operations into the U.S. marketplace easier, particularly for virtual services or sales. Companies looking to transfer executives or key employees to the U.S. to establish new operations are increasingly asking:
Do we need a physical U.S. office to transfer employees?
The L-1 visa allows companies to transfer executives, managers, and specialized knowledge employees to the U.S.-based company office from one of the company’s foreign offices. It can also be used for the purpose of establishing U.S. operations for the foreign company. Although it is a non-immigrant visa, it allows dual intent - meaning someone can transfer to the U.S. on a temporary assignment, and eventually adjust status to get a green card. In recent years, USCIS has increased scrutiny when reviewing L-1 visa applications for new U.S. operations, particularly for smaller and mid-size companies.
Under the USCIS regulations, foreign companies may apply to send an executive, manager, or specialized knowledge employee to the U.S. to establish a new office or to be employed in a new office. A “new office” has been defined as “an organization which has been doing business in the United States for less than one year”. The U.S. government perceives the L-1 visa category for new offices to carry a high risk of abuse, because plans about the viability of a new business in a different country are inherently speculative. For that reason, the initial L-1 visa will only be issued for one year.
When applying for a L-1 visa for a new office, the company must satisfy additional USCIS requirements regarding the new office facility and the employee who will establish or work at the new office. The sufficiency of the new office facilities must be justified by the petitioner and must be able to support the position for a manager or executive beyond the first year. USCIS regulations do not specify what evidence meets the standard of “sufficient”, and officers have a great deal of discretion. It’s common for USCIS to issue an RFE requesting extensive evidence on leases, floor plans, photos of the premises, rent payments, and even evidence that the business has in fact commenced business activities from the location listed on the lease.
The “sufficiency” of physical presences for conducting business will be different for companies, depending on the type of operations that their company provides. For example, a company that provides trucking services may need to demonstrate that they have sufficient garages, parking, and repair facilities for their truck fleet. A company that provides website coding services may need to demonstrate that they have sufficient office space for their U.S. employees, including “room to grow” for anticipated U.S. citizen hires. Companies who apply for new office L-1 visas must provide a detailed business plan, and that plan will help shape the officer's subjective decision on what premises are "sufficient".
There is some flexibility for an L-1 visa holder to work remotely, as L-1 visas are not governed by Labor Condition Applications (unlike H-1B visas). However, this does not negate the need for the U.S. new office to have sufficient physical premises that can accommodate all employees. Location audits do happen, and there is an expectation that the physical office is open and conducting business. If the office is not being used (i.e. is closed), USCIS may issue an intent to revoke the L-1 petition based on the assumption that the company is no longer running.