Very Confused.... Media VISA? L1A? U.S.-based LLC. Help!

[unitedstatesofcanada]

*updated with new info, clearer explanation*

My official title is the Executive Editor of a well-known internet-based publication. The company is U.S.-based with some operations in Canada. I am a Canadian citizen living in Canada.

I co-founded the publication in 2005 with an American partner. For the past four years, I have conducted my duties as a company executive remotely from Canada. We have no centralized office, and all of our workers collaborate via telephone and internet communications. The need has now arisen for me to occasionally visit the United States for short periods of time to help manage our journalistic team in the coverage of press events, plus oversee video productions.

Legal ownership of currently falls under my American partner's publishing firm, a California limited-liability company. Currently, all of our workers (including myself and my partner) are paid by his company as independent contractors, however they all have permanent job titles and positions with the company. Some workers even have employee health insurance packages.

My operating agreement with my partner recognizes that roughly 50% ownership will be assigned to me when the appropriate business structure is determined. We have registered a new LLC, which we intended to make a joint venture (or 49/51) between myself and my partner's LLC. The ownership could be split 49.5-to-50.5% or vice-versa if it was advantageous to do so.

I am paid a base salary of $100,000 per year plus bonuses. My role with the company is very broad, executive and managerial in nature, including overall strategic direction, creative direction, business strategy, editorial oversight, and so on. I could be described as an entrepreneur, executive, manager, consultant, journalist, and marketing expert. My role with the company is integral to its continued success and therefore the livelihood of many American workers depends on me.

I have strong ties to Canada, including ownership of a home and a Canadian fiancée. I do not have a university degree, though I attended a Canadian university for a period of time to study Media.

Revenue is in the low seven-figure range though given some new contracts we're expecting that to increase significantly over the next year. As a growing internet company, our valuation could be in the tens of millions. We've had informal talks with companies interested in buying us before for millions.

All my visits to the U.S. will be less than a week at a time. In many cases, the visit would last a day or two at most.

In any case, I am open to any ideas for the best solution here. At the end of the day, I simply want to be able to legally enter the U.S. and do the similar work to what I've been doing here in Canada. If that means creating other business entities or changing the way things are set up, it can be done. But I'm looking for the simplest solution.

[Steven]

Well first of all tax-wise, your structure appears to be that you aren't directly employed by the company, in essence there is a company you own 50% of and you're self-employed and you invoice them, which is probably the sensible way to do it because it prevents the US corp having to have a Canadian payroll and makes their tax paperwork much simpler.

However because you're not directly employed by them and there is no Canadian office per se so you don't qualify for L-1. There's no Canadian office so that rules out I as well. Doesn't fit the B-1 NAFTA provisions or TN-1 and it doesn't require a degree either so H-1B is out.

In addition if you go and work for them in the US, you can't use your self-employment status in Canada. The most sensible way to do it is for them to pay you directly on a W-2, but that makes trying to make yourself fit into B-1 impossible, basically.

I think you've got two options basically, the first is to open up a Canadian office, and either get the US corp a Canadian business number and payroll, or set up a Canadian corp which the US corp has control of (be careful with this, you couldn't use a CCPC because it has to be Canadian controlled - corporation taxes could kick in if you aren't careful with the payroll and expenses structure). Then once you've worked for it for a year, L-1 becomes plausible.

The second method is to use your investment in the US corporation as a reason to get E-2, treaty investor, although this is a pretty complex immigration category. Although from a tax standpoint it's relatively straightforward because most of what you need is already in place, they'd just put you on existing US payroll.

http://toronto.usconsulate.gov/content/ ... ment=evisa

[unitedstatesofcanada]

Thank you for taking the time to respond.

What would constitute a Canadian office? For example, I have a home office and I often work together with the American Canadian permanent resident.

Do you believe this is inaccurate? Particularly the bolded part? It seems to go against what you're saying and what I have read elsewhere, but that doesn't necessarily mean it's false.

L-1 visas are available to a person (and L2 to his/her family), to transfer him/her to work in the United States for an employer, who has worked abroad for 1 continuous year within past 3 years in a related business entity in a manager/executive or specialized knowledge staff capacity.

Applicant must be coming to the U.S. to continue providing services for this same employer. Worker does not need to be directly employed by the sponsor. It is OK even if he/she is paid through personal service company or an agency, or even as independent consultant, as long as the sponsor had management and control over the worker during the qualifying year.

As for the E2, I have considered this option but I am unsure if I could qualify due to the rigidity of it. I have not directly invested huge sums of cash in this business. However, the business is worth millions of dollars and has generated a lot of income for American workers. We've also spent a lot of money investing revenue back into the business, and in theory half of that revenue to date has been "mine." Nonetheless I am not sure how or if this argument can be made.

Again, thank you for the response and help.

[Steven]

No that doesn't sound correct to me, there was a crackdown on L-1 a few years back to stop that sort of thing, the law was amended to make it clearer. This is a press release on it: http://www.uscis.gov/files/pressrelease ... 9_2004.pdf

IIRC, a home office doesn't qualify as an office abroad because it has to be something ordinarily available to that business, although I suppose you could argue that it was (and really, how can they check) however because the company has no corporate entity in Canada you've got no way of establishing that. The tax treaty gives the definition of a "permanent establishment", which a home office might not be because if you're in the US it's not open anymore.

The real trick to it is to get all the paperwork done that establishes that it is in fact an international company, i.e. get it a Canadian business number, put you on the Canadian payroll at a Canadian address etc. although that is no small undertaking (it sounds easy at first glance but for a small company it's a lot of paperwork). As complicated as an E visa might be to get that may be less complex and more appropriate.

If you've got a large investment you should be able to get E-2, it does help with E visas to find a consultant who is familiar with them as they will have templates and so on that they have experience using (I don't know any personally although there have been one or two on here in the past, try doing a search).

E-2 does also have the advantage of being endlessly renewable, L-1B is only valid for a maximum of five years, although there is "L-1 intermittent" which allows you to enter for up to six months a year indefinitely. Plus with E-2 you can apply now, with L-1 you'd have to wait a year to establish the foreign employment requirement.

[unitedstatesofcanada]

It seems rather ridiculous though, because we have no offices anywhere. I think if we have Canadians working in Canada that constitutes a Canadian operation. Now, whether or not that has to be officially incorporated etc is another question. Do you think an intracompany transferee could be from an unincorporated organization controlled by a U.S. parent'?

As for the E-2 thing, do you think a case can be made if there hasn't actually been capital invested? How is this defined?

[Steven]

Depends on what CBP thinks really when they review the application, which is always the trick. If you're self-employed in Canada, i.e. not on their payroll, and the office is a home office, i.e. when you're not there it's not available for the use of the US parent and the US company does not own or control it then I doubt you'd get it to be honest. The ties need to be more substantial than that.

E-2 requires a "significant investment" which is open to interpretation but can mean as little as $50,000, if the company is worth millions and you own 50% of it, I'm sure you could come up with some method to meet that requirement.

What I suggest you do is read the NAFTA handbook, fortunately the preview on Google Books covers E and L. Page 84 has the definition of a foreign office for the purposes of L.

Bear in mind that book is ten years old and it doesn't reflect the L-1 Reform Act 2004 which tightened things up.

[unitedstatesofcanada]

Hi everyone. I've been re-evaluating this situation and here is my analysis of all the Visa categories that might be relevant. I'd really appreciate some more input.

I Foreign Media
--> My understanding is the Foreign Media Visa is for people performing work for non-U.S. media companies.
--> Would it be acceptable for me to set up a Canadian branch of the company, and then perform work for that company using an I Visa?
--> I would be paid by the Canadian company, and the Canadian company would be funded by the original American company. Would this type of system still be considered me working for a U.S. media company?
--> We could set up an actual Canadian office in my hometown if a home office wouldn't count. But does a home office count?

H1-B
--> Everything about the H1-B is relevant to me, but I don't think I have the qualifications.
--> I don't have a degree (I attended university for less than 2 years) and my work experience in management work is 5 years or so.
--> I've read one must have 12 years work experience to qualify, yet on other sites there is no mention of it. Is it 12 years?

E2
--> I've had E2 recommended to me, but I'm not sure how I could show the type of direct investment the rules talk about.
--> The company began with just me doing everything. The cost of starting an internet business (especially a few years ago) was really low.
--> But since then we've spent millions of dollars on staff and other things out of the revenue we've earned. The problem is money has just been kept in the company. It wasn't even sent to me first, then sent back in to the company.

B1
--> Some people seem to suggest I can enter the U.S. under this status to meet with the rest of the team to discuss things or whatever (i.e. like a business meeting).
--> Is this really legitimate? If I'm an independent contractor to a U.S. company then the relationship is less direct. Moreover, I am not necessarily being paid directly for the U.S. visits. It's all semantics.

L1A
--> At first this sounds like the most obvious solution to my problem because the type of transfers possible are pretty broad.
--> One problem is that no one who works for the company is an employee per se. Rather, they're all paid as contractors, even though a large number are full time and salaried.
--> The second problem is there is no official business entity in Canada. Is this required, or is a de-facto branch good enough? If an official entity had to be set up, would I then be forced to wait a year?
--> Even if there's a solution above, we have no centralized offices, but rather a bunch of people spread throughout Ontario. Would this satisfy the definition of a branch or not? After all we have no offices in American either.
--> As mentioned with the I Visa above, we could set up an actual Canadian office in my hometown but most of the workers wouldn't actually work there since they live hours away in every direction.

TN
--> I could make the case as management consultant. I understand this is meant to be an advisory role. For example, my trips to the U.S. could consist of me going to observe the work being done, then when I get back to Canada come up with feedback on how things could be done better.
--> The biggest problem I've noticed is it says the TN Consultant may not be a controlling shareholder or owner of the company. That would be ok, because I could just own 49.5 percent and the American side could own 50.5 percent.
--> But I also noticed one site said a TN can't consult for a company they "started." Is this true, or does it just come down to who the controlling owner is?
--> Is it possible my Canadian job and U.S. 'job' could be two different things for the same company? For example, when I'm in Canada I am an executive/manager, but when I am in American I am being paid to be a management consultant?

[Steven]

E-2 is the one for you from the sounds of it. The investment doesn't have to be enormous and if the book value is millions and you own 49.5% I find it hard to believe you couldn't get it. Clearly you are entering to manage a US investment/business from the sounds of it which is what the visa is for. Plus it can be renewed indefinitely.

E-2 is complex to apply for and this is one of the categories where it really does help to get an immigration consultant involved as each application is significantly different, so someone who has helped with several will have more of a clue.

Business meetings are permitted under B-1 if that's all you're going to be doing, I suggest you look at the regulations for it but if the company is US-based then what you can do is fairly limited on B-1.

TN-1 I don't think is practical, it's not about what percentage of the company you own it's whether you exert any control over it which clearly you do. It has to be an arm's length relationship. If you owned stock in say, IBM and IBM hired you on TN-1, then no problem but if you were on the board of directors or owned enough stock to get the company to make decisions, then you can't do that. The regulation on this one isn't specific because of the number of ways a company could be set up, basically what it boils down to though is that it must be an arm's length relationship.

L-1A definitely isn't the best option, because you live in Canada and L-1A is intended for people who are going to be living in the US. From the sounds of your business structure it isn't going to be practical anyway, but assuming your business met the regulations on this one (which were made tougher by the L-1 Reform Act) then the L category to go for would be L-1 intermittent because it can be renewed indefinitely. Have a look at the L regulations on the USCIS website or in that book that I linked to.