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Giving a Boost to the Little Guy: Strategies for Advising Small and Emerging Businesses


Small and emerging businesses are playing an increasingly important role in both the domestic and global economies and leading the way for the future. This practice advisory will provide a general overview and background regarding common features of small businesses that impact visa applications and related practice pointers. This advisory will also outline visa options and provide practical tips regarding preparation various types of visa petitions for small and emerging businesses.

By Elise A. Fialkowski, Elizabeth Chatham, Helene N. Dang & David A. Harston


While USCIS may disagree with the allegation, the record is clear: USCIS treats small companies and organizations, particularly new ones, with greater skepticism and scrutiny than medium and large-size companies (by revenue or employee numbers).   As a result, foreign nationals must proceed thoughtfully and deliberately when setting up their small businesses and preparing visa petitions to USCIS.

Shareholder Identity and Control

The nationality of the business owners and who will control the entity may determine the types of visa options available. For example, eligibility for the E-1 treaty trader and E-2 treaty investor visas depends on whether the United States has a treaty of commerce and navigation with the country of the foreign national or foreign entity’s nationality.  If pursuing an E-2 treaty investor visa, the entity must be at least 50% owned by nationals of the treaty country (note shares owned by U.S. permanent residents cannot be considered). For L-1 petitions review whether there is a qualifying parent, subsidiary or affiliate relationship.  In addition to the more common definition of affiliate (a subsidiary owned and controlled by the same parent or individual), consider whether the entities qualify based upon ownership or control by the same group of individuals such that the foreign and U.S. entities are owned by the same individuals in the same or approximately the same percentages.

On the other hand, ownership and control of a business by a foreign national seeking H-1B status in the United States may present a barrier to an H-1B given the requirement of an employer-employee relationship. A similar issue may arise for those seeking Trade NAFTA (TN) status (Canada and Mexico), E-3 status (Australia), or H-1B1 Free Trade status (Singapore or Chile). Nationals of Iran, Libya, Somalia, Syria, Yemen, North Korea, and Venezuela, which are subject to Presidential Proclamation 9645 (Travel Ban 3.0), may find it difficult to secure nonimmigrant visas to enter the United States for work. While waivers are available under the Travel Ban, the process for securing one is difficult at best.

Practice Pointer: Counsel should discuss, analyze, and evaluate nonimmigrant visa options with ownership nationality and entity control in mind. Is there a treaty of commerce and navigation? Does a Free Trade agreement apply? Is the foreign national impacted by the travel ban? How will ownership interest impact availability of nonimmigrant visas like the H-1B — is there a valid employer-employee relationship such that there is outside control of the beneficiary, the beneficiary could be fired and the corporation/entity in fact controls the beneficiary’s work? If the U.S. entity will be owned and controlled by another entity, create a corporate structure chart which includes both entity nationality and ownership percentages.

Developing a Business Plan

One of the first steps for most new enterprises is to develop a solid business plan. This is especially true for small businesses involved in U.S. immigration matters. Business plans are not only critical when seeking L-1 visas for new offices and for E-1/E-2 classification, but they can also play an important role in most nonimmigrant visa applications. The requirements for a detailed business plan are listed in case called Matter of Ho, 22 I&N Dec. 206, 213 (AC Examinations 1998).

Practice Pointer: A solid business plan typically includes an Executive Summary, Company Description, Market Analysis, Organization and Management, Description of Services/Products, Marketing/Sales, Funding/Investment, Financial Projections, Hiring Projections, and an Appendix of any supporting documents. There are several companies across the United States that prepare business plans with U.S. immigration matters in mind.

Selection and Incorporation of Business Entity

Choice of business entity is an important consideration for any new business. Foreign nationals have many of the same options as to U.S. citizens including sole proprietorships, partnerships, LLCs, and C Corporations. Foreign nationals generally will not qualify to own S Corporations given their U.S. nationality requirements.

Practice Pointer: Hiring a knowledgeable and experienced business attorney can pay dividends for years if not decades down the road for foreign national clients and their business entities. Retaining business counsel to assist in the choice of entity, draft incorporation documents including articles of incorporation and bylaws, can help ensure the new business is starting off on the right footing.

Preliminary Business Activities

Whether already in the United States in nonimmigrant status or entering the United States as a B-1 business visitor, the owner(s) of the small enterprise must invest the time and effort on building the legal and structural foundation for the business. USCIS will look to see the extent to which the business comports with standard business practices as the agency evaluates the company’s bona fides.

Practice Pointer: Small business owners should work with their business attorney and other business partners to secure a Federal Employer Identification Number (FEIN), required business licenses and permits, facilities/premises, business bank accounts, insurance, signage, and purchases of other equipment, goods, or materials essential for the day-to-day operation of the business. As appropriate, hiring, particularly of U.S. workers, can go a long way toward establishing the business’ credibility with the federal authorities. While preliminary activities are essential for visa applications, care must be taken that the beneficiary does not violate status in the United States or be viewed as working without authorization.

Validation Instrument for Business Enterprises (VIBE)

The Web-based Validation Instrument for Business Enterprises (VIBE) is a tool USCIS employs to verify the existence of companies or organizations filing certain employment-based petitions and applications. VIBE uses commercially available data, currently from Dun & Bradstreet, to try and validate basic information about companies or organizations petitioning to employ certain foreign nationals and to validate the basic information about the companies or organizations.

Practice Pointer: Small business owners should log onto the Dun & Bradstreet (D&B) website (a link is available through the USCIS website at to either create a D&B account or make sure their company’s account is up-to-date at the time of filing any petition with USCIS. While USCIS does not require companies to create or update records with D&B, doing so can help to avoid unnecessary RFEs or limit issues raised in RFEs.  


The L-1 Intracompany Transferee Visa

The most natural option for many small businesses is an L-1 Intracompany Transferee visa if the company has operations outside the United States.   L-1 visas are available to applicants who, in the three years prior to filing an L petition, have been employed abroad continuously for at least one year by a parent, branch, affiliate, or subsidiary of a U.S. petitioning company in a managerial, executive, or specialized knowledge capacity and who will perform one of those roles in the United States. USCIS recently clarified that the one-year period of full-time employment abroad must be met at the time of filing of the L-1 petition. USCIS also clarified that the three year period will be adjusted for an applicant who was admitted to work for the qualifying organization in an employment based nonimmigrant category like an H-1B or E-2, but the three year period will not be adjusted for those who enter the United States to work for the qualifying organization as a dependent (such as an L-2) or as a student. Brief visits to the U.S. during the one-year of employment abroad do not break the one-year continuous requirement but such periods shall not be counted toward the fulfillment of that requirement. The organization must remain a qualifying organization with operations outside the United States during the entire period of L-1 status.

As most small businesses seeking to utilize the L-1 are relatively new, this advisory focuses on practical guidance for the “new office” L-1.

The New Office L-1

A “new office” is defined as “an organization that has been doing business in the United States through a parent, branch, affiliate or subsidiary for less than one year.”

A “new office” petition is initially approved for one year and requires substantial supporting documentation demonstrating:

  • the establishment of the U.S. entity (such as certificate and articles of incorporation, bylaws, directors’ meeting minutes);
  • the ownership and control of the qualifying U.S. entity (stock certificates, stock ledger, corporate organization chart);
  • the viability of the proposed U.S. business operations (comprehensive business plan, planned or actual capitalization of the U.S. company by the foreign investor or company);
  • the establishment of sufficient physical premises to house the new office (e.g., signed lease agreement detailing the amount of space leased; photographs of premises, equipment, and furniture); and
  • the beneficiary’s prior qualifying employment with the foreign entity as a manager, executive or specialized knowledge employee and qualification for the U.S. role (education documents, resume, experience verification letter, position descriptions, performance reviews, etc.).

Practice Pointer:

The business plan is a key document in a L-1 “new office” petition filing. Consistent with Matter of Ho, the business plan should include a description of the U.S. business and objectives, market analysis of the products or services, target market strategy, comprehensive staffing plans, an organizational chart, financial goals and projections, funding and a timetable for proposed action. The business plan should include a realistic two to five year business projection with an emphasis on the expected and realistic growth. A well-documented L-1 “new office” petition can be approved, even where the business in the U.S. is prospective in nature.

As referenced above, however, there must be significant documentation that the U.S. business has in fact been established and that the business has either purchased property or obtained a lease. USCIS will often ask whether the square footage/facility is adequate for the claimed operations. One recommendation is to have a clause in the lease agreements to increase the office space should that company need it. Leases with managed office spaces like WeWork or Regus that provide administrative support may help bolster an L-1 to show that the executive or manager is relieved of daily administrative tasks. Virtual offices are highly scrutinized and are unlikely to be approved.

While the L-1 category has no numerical limits or wage restrictions, USCIS has been applying higher scrutiny on both L-1A and L-1B petitions in recent years, with multiple-page requests for evidence (RFEs). In the era of the Buy American Hire American (BAHA) Executive Order, it is also helpful to explain how the new business will create jobs for U.S. workers and benefit the U.S. economy.

Note that USCIS has limited the ability of F-1 students to utilize the L-1 visa to open and expand business to the United States. In the past, F-1 graduates were often able to obtain L-1s for a new business in the United States if they could show they had worked for at least one full year in a qualifying capacity for a related organization abroad in the three years before entering the United States on the F-1 visa. The new USCIS memorandum forecloses this option for many F-1s as the three-year period can no longer be amended for F-1s and those who were not working in the U.S. for the qualifying organization on approved work visas.

L-1 visas for such new offices are limited to an initial period of one year. Extension applications face close scrutiny, especially if the business is unable to show significant growth in the year.  

New Office L-1 Extensions

To extend L-1 status beyond the initial one year, the U.S. petitioner must file a new I-129 and L supplement prior to the expiration of the initial approved petition, along with substantial evidence demonstrating that the new office has become an established business. Such evidence must show: (a) the U.S. and foreign entities are still qualifying organizations; (b) the U.S. entity has been “doing business” for the previous year; (c) the duties performed by the beneficiary in the previous year and the duties the beneficiary will perform under the extended petition; (d) staffing of the new office for the previous year and staffing anticipated under the extended petition, including payroll records; and (e) the U.S. operation’s financial status.

One of the biggest challenges many L-1 “new office” petitioners face is developing the U.S. business to a level that can support a managerial or executive position by the end of the initial one-year period, as required by USCIS for L-1 status extensions. It sometimes takes more than a year to reach that level, and USCIS has not generally allowed for more time for continued development of the “new office.”

Practice Pointers: Because requests for L-1 “new office” extensions after the initial year are more rigorously adjudicated by USCIS, practitioners should counsel clients to carefully monitor and document the progress and growth of the new office.

An updated detailed business plan can also help a small business overcome USCIS scrutiny and obtain the L-1 extension if the plan can show growth and ongoing funding for operations and payroll. Documentation of sufficient capital in the home country to support the US operations can make up for initial losses.   An outline of client and/or sales growth and opportunities for the U.S. business as well as actual contracts or funding streams should be submitted. Corroborating documentation and analysis related to revenue streams and growth is essential.   If the business is performing poorly (or does not show sufficient growth to support a manager or executive) prior to the required extension, alternate work authorized visas should be considered.

The H-1B Specialty Occupation Visa

The H-1B classification has long been a go-to work visa type for U.S. employers looking to sponsor professionals for specialty occupations. To qualify as a specialty occupation, the position must meet at least one of the following requirements: (1) at least a bachelor’s degree in a specific specialty is normally required, (2) a degree requirement is normal in the industry or in the alternative, the position is so complex or unique that it can be performed only by a degreed individual, (3) the employer normally requires a degree for the position, or (4) the nature of the duties are so specialized and complex that knowledge required to perform the duties is usually associated with the attainment of at least a bachelor’s degree.   There are wage and posting requirements for the H-1B in addition to an annual quota and lottery.

Practice Pointer:

There are several excellent AILA practice pointers regarding H-1B visas, including for example, an H-1B practice pointer regarding responding to “small company” RFEs. Key issues for small businesses include the employer-employee relationship as well as the need for detailed business plans that have been addressed above.

Small businesses should also consider whether they may be able to fall within an exemption from the H-1B cap.  Small businesses and startups compete against larger companies with a greater proportionate share of H-1B cap petitions submitted for the limited 85,000 H-1B visa numbers available in the yearly quota. Small businesses may be able position themselves to benefit from certain H-1B cap-exempt options discussed below.

H-1B Cap-Exempt Employment

Private employers that place employees to physically work at an institution of higher education or a related or affiliated nonprofit entity, or nonprofit research organization or government research organization may file cap-exempt H-1B petitions so long as there is a “nexus” between the work performed and the normal purpose of the nonprofit. Note that the regulations require that the majority of the beneficiary’s work time must be spent at the exempt institution.

While most small businesses are “for profit,” non-profit businesses should consider possible affiliation with cap exempt organizations that allows for the filing of a cap-exempt H-1B petition.  Concurrent H-1B employment with a cap exempt organization may also be an option as long as the employee also remains working for the cap exempt organization at least part-time.

Practice Pointer: Small businesses may want to consider exploring options to place their H-1B workers at a qualifying worksite where possible in order to file a cap exempt H-1B petition.  Small companies may be involved in collaborative research with cap exempt organizations such that workers can reasonably be place on site at exempt organizations. Concurrent employment may also be an option particularly where there are joint research projects.

The O-1 Extraordinary Ability Alien Visa

The O-1 extraordinary Ability Alien visa is a viable option for some small businesses. Many startups are based upon research or key developments that can serve as the basis for an O-1 petition.

To obtain an O-1, the beneficiary must prove sustained national or international acclaim in the arts, sciences, education, business, or athletics. In order to qualify as an O-1A in science, education, business, or athletics, the beneficiary should fall within “one of the small percentage who have arisen to the very top of the field of endeavor.”

Small businesses operating in the arts can utilize the O-1B visa and its lesser standard, “a high level of achievement in the field of arts evidenced by a degree of skill and recognition significantly above that ordinarily encountered.”

The accomplishments of all types of O-1s must be “recognized in the field through extensive documentation,” Adjudications have become increasingly subjective with extensive RFEs the norm in the current USCIS climate.

Despite the current challenges, there is no cap on the number of O-1 visas available, nor are there any wage restrictions. The O-1 allows for a U.S. employer or agent petitioner to request up to three years initially, with unlimited extensions available in increments that depend on how the
O-1 “event” is defined. In fact, the Administrative Appeals Office (AAO) rejected the Service’s interpretation of “event” for O-1 purposes, stating the “definition of event must be interpreted broadly.”

Practice Pointers

O-1s cannot self-petition. Either a recognized agent or employer is required. Attorneys should carefully define the “field of endeavor,” obtaining client input in the process. A key strategy is to narrow the niche into a specific area to clearly show how the applicant has risen to the top of the field of endeavor. For example, rather than identifying a broad field like “engineering,” if the applicant has applied machine learning to robotics to increase efficiency, such a narrow field and related contributions could be utilized.

In both O-1A and O-1B cases, well-written letters (ideally on letterhead of credible institutions, companies or organizations) are critical to the success of the case as well as significant well- organized corroborating documentation. At least three of the ten types of evidence are required for the O-1A, and applicants should do their best to show as many types of evidence as possible. The types of evidence will vary depending upon the company or business.   It is necessary to think “outside the box” for many O-1 cases for small businesses or startups. Consider non-traditional evidence such as Ted Talks, online presence, reputable blogs, and use of software or related applications (even open source) developed by the beneficiary. In this era of BAHA, explain how the O-1s skills can ultimately result in job creation for U.S. workers and benefit the United States.

Many O-1 cases require a consultation from an applicable union or peer group. If there is no applicable union, a recognized authority can be used. Remember to choose carefully and prepare a detailed request as negative consultation letters by labor unions or peer groups can be now be submitted directly to USCIS.

E-1 Treaty Trader and E-2 Treaty Investor Visas

Treaty trader (E-1) and treaty investor (E-2) visas are for citizens of countries with which the United States maintains treaties of commerce and navigation. The applicant must be coming to the United States to engage in substantial trade, including trade in services or technology principally between the United States and the treaty country or to develop and direct the operations of an enterprise in which the applicant has invested a substantial amount of capital, or to work in the enterprise as an executive, manager or essential skills employee.  The applicant and business must possess the nationality of the treaty country. The nationality of a business is determined by the nationality of the individual owners of the business. Generally, nationals of the treaty country must own at least fifty percent of the business in question.

Although it may be challenging to find an E company, the benefit for an individual closed out of the H-1B or L-1 visa, is that there are no quotas and no prior relationship to the company required. While it is only beneficial for the nationals of a treaty country, it still provides a viable alternative.

Practice Pointer:

The E visa, if there is a qualifying treaty, and the business and applicant possess the treaty nationality, is often a preferable option to a new office L-1 for a small business.   The E visas can be applied for directly at a U.S. Consulate abroad and the initial E visa is often issued for a longer duration than the L-1 as the visa reciprocity schedule for many treaty countries exceeds one year.

A growing trend is the E-2 Grenada visa. An increasing number of individuals who are from countries without relevant treaties are obtaining citizenship in countries that allow for E-2 issuance, like Grenada. AILA firms have been successful in obtaining E-2s for newly minted citizens of Grenada even at U.S. Consulates in China.

Key issues in E-2 visa adjudications for small businesses include whether the investment is in fact “substantial” as there is no set dollar amount. Generally, the investment must be sufficient to ensure a successful enterprise of the type contemplated. A proportionality test also applies such that the lower the cost of the business, the higher the percentage of investment is required. A detailed business plan is essential to show that the investment meets these requirements.   The business plan should also show projected future capacity of the business realizable within five years. Under BAHA, it is also helpful if the business shows a general benefit to the United States as well as plans to hire U.S. workers.

The E-1 requires that the trade be principally between the United States and the treaty country and the trade must already be in existence. Existing trade includes binding contracts that call for immediate exchange and evidence of trade in terms of invoices, custom declarations and the like. The FAM recognizes that substantial trade is required but “smaller businessman should not be excluded if demonstrating a pattern of transactions of value.” It is also recognized that “proof of numerous transactions, although each may be relatively small in value, might establish the requisite course of international trade.”

While applications for E-1 and E-2 visas can be made with USCIS for those in the United States, as a practical matter, most applicants apply directly at the relevant U.S. Consulate abroad. The U.S. Consulates generally do not recognize a USCIS E visa approval and require submission of a full E visa petition.

A detailed checklist of suggested supporting documentation for both E-1 and E-1 visas can be found in the Foreign Affairs Manual at 9 FAM 402.9-11(B). Adjudications of E visas, however, vary at each post and there are often post-specific requirements and guidelines for submission of the application.   Consular websites are a helpful resource for application/documentation requirements at each post. AILA colleagues also provide helpful guidance.

The TN for Citizens of Canada and Mexico

To hire or transfer Canadian or Mexican foreign national employees, the TN category under the North American Free Trade Agreement (NAFTA) may be an excellent option. There is no prevailing wage requirement, part time employment is permitted, and locations can change without an amendment. This visa category requires a U.S. employer and is not appropriate for self-petition or self-employment. On September 30, 2018, as part of the renegotiation of NAFTA, the United States, Mexico, and Canada signed a trilateral agreement, The United States-Mexico-Canada Agreement (USMCA). Notably, the U.S. immigration provisions of NAFTA, including the TN category, remain substantively unchanged under the USMCA. Subject to approval by Congress, USMCA is anticipated to take effect in 2019.

Appendix 1603.D.1 of NAFTA designates 63 professions eligible for TN status, the required educational credentials, and, if applicable, alternative credentials. Most of the TN categories require a degree or post-secondary diploma in a related field with the exceptions for the management consultant and scientific technician/technologist categories. Equivalencies based on a combination of education and experience are not acceptable for TN occupations that require a degree.

Practice Pointer:

Canadian citizens are visa-exempt for the TN category, allowing applicants to apply directly at a port of entry with same-day adjudication in approvable cases. Before sending any TN to a Port of Entry, it is advisable to check with AILA colleagues as to recent trends and adjudications. Adjudications can vary by Port of Entry. It is also possible for Canadian TN applicants to request adjudication of the TN application at the USCIS Vermont Service Center. This option may be beneficial if the applicant will not perform well in an interview at the Port of Entry. Mexican nationals can apply directly for a TN visa at a U.S. consulate abroad.

Certain TN categories like the management consultant are subject to greater scrutiny. According to Appendix 1603.D.1 of NAFTA, management consultants must possess either a bachelor’s degree in a field related to the consulting position or have five years of experience as a management consultant or five years of experience in a field of specialty related to the consulting agreement. Even though TNs can be admitted for up to three years at a time, and there is no upper limit (assuming there is the required nonimmigrant intent),for highly scrutinized categories like the management consultant, the longer an applicant remains on TN status, the more challenging a renewal or extension becomes. It must be shown that the management consultant is not an employee, but rather a consultant outside the normal operations of the company and a contract is required. The government has also recently limited management consultant admissions to the duration of the consulting contract.  

The E-3 for Citizens of Australia

Capped at 10,500 per year, E-3 visas are available to nationals of Australia and mirror the H-1B category in several ways. Like the H-1B, the E-3 visa requires a job offer in a “specialty occupation,” a position that requires the minimum of a bachelor’s degree in a relevant field. If the applicant’s degree does not “match” the offered E-3 occupation, the applicant may combine education with experience to equate one’s background to a four-year U.S. bachelor’s degree. Employers must file a Labor Condition Application (LCA), offer the E-3 worker the higher of either the actual or prevailing wage for the occupation, and comply with all public access file requirements. The E-3 may be requested for up to two years at a time, with extensions granted indefinitely. Upon a timely-filed extension, E-3s also receive an automatic 240-day extension of employment authorization.

Practice Pointer:

Even though E-3s are now eligible for the 240-day extension, since premium processing is not available for E-3 petitions filed with USCIS, applicants will generally experience faster processing at a U.S. consulate. Cases at USCIS can also often be subject to extensive Requests for Evidence which further delay adjudication. Note, if applying for the E-3 visa in countries other than Australia, it is advisable to include an attorney letter and the relevant guidance as officers outside Australia may not be familiar with the visa category.   Processing can also take longer at posts unfamiliar with the E-3 visa.

H-1B1 for Citizens of Chile and Singapore

Created by the U.S.- Chile Free Trade Agreement and the U.S. – Singapore Free Trade Agreement, the H-1B1 is available to citizens of Chile and Singapore, with a maximum of 6,800 visas (1,400 for Chile and 5,400 for Singapore). Similar to the H-1B category, the H-1B1 requires a job offer in a “specialty occupation” (with the exception of four professions listed in appendix 14.3(D)(2) of the U.S. – Chile Free Trade Agreement).   Like the H-1B and E-3 categories, employers must file an LCA, offer the H-1B1 worker the actual wage paid to or prevailing wage for the occupation, and comply with all public access file requirements.

Applicants may apply directly at a U.S. consulate by presenting a certified Labor Condition Application (LCA) and a written offer of employment. Applicants can be admitted for one year and receive extensions in yearly increments. Unlike H-1Bs, there is no portability of employment option.

Practice Pointer

Because the duration of the H-1B1 is only valid in year increments, it is often advisable to file under the H-1B cap, particularly if the beneficiary intends to apply for permanent residence. Like the H-1B, it is critical to show a valid employer-employee relationship.  

Options for Work Authorization Through Permanent Residence or Derivative Status

If the applicant possesses an F-1 visa with authorized optional practical training, pursuing permanent residence may be a viable option for continued work authorization if the relevant employment-based preference for the beneficiary’s place of birth is not significantly backlogged.

Options for small businesses may include the EB-1A Extraordinary Ability Alien as well as the EB-2 National Interest Waiver categories in addition to the traditional PERM labor certification route.

If a PERM labor certification process is initiated early in the authorized validity period, an F-1 may able to obtain permanent residence without having to change status.   Care must be taken, however, as the F-1 is a pure nonimmigrant intent visa. The recent 90-day rule must be considered in pursuing such options.

There may also be family-based options for employment authorization. In addition to sponsorship for immediate relatives, consider whether the beneficiary may be eligible for work authorization as a dependent visa holder. L-2 and some J-2 dependent spouses may apply for employment authorization and receive an employment authorization document (EAD). Under current rules that are expected to change, certain H-4 spouses may also be eligible for an EAD.


Effective representation of small businesses requires a thoughtful review of options and strategies based upon the latest immigration developments.   Attorneys are well advised to evaluate each option and inform the client of the risks and benefits of each option.


The material contained in this article does not constitute direct legal advice and is for informational purposes only.  An attorney-client relationship is not presumed or intended by receipt or review of this presentation.  The information provided should never replace informed counsel when specific immigration-related guidance is needed.

Reprinted with permission from the June 11, 2019 edition of the The Legal Intelligencer© 2018 ALM Media Properties, LLC. All rights reserved. 
Further duplication without permission is prohibited.  877-257-3382



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