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The L-1 visa is a valuable tool for multinational companies looking to transfer key employees to the United States. It is specifically designed for executives, managers, and employees with specialized knowledge. Understanding certain terms and their meanings is essential for companies and employees navigating the L-1 visa process. In this blog, we’ll explain three key definitions that are important in the context of the L-1 visa: doing business, executive capacity, and managerial capacity.
1. Doing Business
In the context of the L-1 visa, "doing business" refers to the regular, systematic, and continuous provision of goods or services by a qualifying organization, either in the U.S. or abroad.
This is a critical distinction because simply having a physical office or an agent in the U.S. does not satisfy the “doing business” requirement. The business must be actively engaged in providing services or selling goods on an ongoing basis. This means that your company must show that it is more than just a representative or holding office in the U.S. or another country. The organization must have meaningful, consistent operations, as mere presence without substantial activity does not meet the visa criteria.
2. Executive Capacity
For employees seeking an L-1A visa, which is specifically for executives and managers, "executive capacity" refers to the ability of an employee to make decisions of wide latitude with minimal oversight. In other words, an executive under L-1A must have significant decision-making authority and the autonomy to direct and manage the company, or a significant part of the company, without being micromanaged.
This capacity typically includes decisions that affect the overall direction of the organization, such as setting corporate policies, approving high-level budgets, or overseeing strategic objectives. L-1A executives do not primarily handle the day-to-day details of the business; instead, they mainly focus on big-picture planning, decision-making, and directing the operations of the business.
3. Managerial Capacity
"Managerial capacity" under the L-1 visa generally refers to an employee’s ability to supervise and control the work of professional employees and manage the organization or a department, subdivision, function, or component of the organization.
This capacity involves responsibilities such as directing the activities of other employees, hiring and firing decisions, and determining work goals for employees. However, managerial capacity can also extend beyond the supervision of employees to managing an essential function of the business. In this case, the employee may not directly oversee staff but is responsible for the performance and management of a critical company function at a high level. The manager must be able to operate with little to no supervision from others, which demonstrates a high level of responsibility within the organization.
Why These Definitions Matter
Understanding these definitions is crucial when applying for an L-1 visa because they help determine eligibility. To qualify for an L-1A visa, applicants must demonstrate that they meet the requirements for executive or managerial capacity and that their employer is actively “doing business.” A failure to meet these standards can lead to delays or denials in the application process.
Moreover, multinational companies must be able to clearly define the roles of their employees and the nature of their business operations to satisfy U.S. immigration authorities that they qualify for the L-1 visa program.
Final Thoughts
The L-1 visa program is an excellent opportunity for companies to transfer key employees to the U.S., but it’s important to fully understand the definitions and requirements involved. Being able to clearly demonstrate that your company is “doing business” and that employees meet the criteria for executive or managerial capacity is essential to a successful application.
Contact Us
If you’re planning to apply for an L-1 visa, we can help. We specialize in preparing detailed job descriptions and crafting business plans that meet the requirements for L-1 visa applications. Contact us today to ensure that your business plan is fully aligned with these definitions and all of the L-1 requirements.
The information provided in this blog is intended solely for informational purposes. While we strive to offer accurate and up-to-date content, it should not be considered legal advice. Immigration laws and regulations are subject to change, and individual circumstances can vary widely. For personalized guidance and legal advice regarding your specific immigration situation, we strongly recommend consulting with a qualified immigration attorney who can provide you with tailored assistance and ensure compliance with current laws and regulations.
Visa Business Plans is led by Marco Scanu, a certified coach from the University of Miami with a globally-based practice coaching Fortune 1000 company executives, entrepreneurs, as well as professionals in four different continents. Mr. Scanu advises clients on turnaround strategies and crisis management.
Mr. Scanu received a bachelor’s degree in Business Administration (Cum Laude) from the University of Florida and an MBA in Management from Bocconi University in Milan, Italy. Mr. Scanu was also a Visiting Scholar at Michigan State University under the prestigious H. Humphrey Fellowship (Fulbright program) with a focus on Entrepreneurship, Venture Capital, and high-growth enterprises.
At present, Mr. Scanu is the managing partner and CEO at Visa Business Plans, a Miami-based boutique consulting firm providing attorneys and investors with business planning services in the areas of U.S. and Canadian immigration, SBA loans, and others.
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