The L-1A visa remains one of the primary tools for foreign companies seeking to expand their operations into the United States through the transfer of executives and managers. However, in today’s adjudication environment, USCIS has adopted an increasingly technical, rigorous, and evidence-driven approach to assessing whether a company truly operates or will operate in the U.S. For companies planning to use the L-1A as part of their U.S. market entry strategy, it is no longer sufficient to simply form a legal entity or present a statement of intent. It is now necessary to demonstrate operational substance, organizational structure, and real economic activity.
When a company does not yet have established operations in the United States, the petition is typically classified as a “new office” case. Under this category, the initial approval is granted for a shorter period, generally up to one year, and USCIS expects to see, from the outset, the existence of a real physical location (for example, an office, warehouse, showroom, or other facility consistent with the business model), as well as the effective implementation of a credible and detailed business plan with projections for growth, hiring, and revenue generation. At the renewal stage, it is not enough to show that the plan was well designed on paper. The company must prove that it was actually executed and that U.S. operations have developed in a consistent and measurable manner.
One area receiving increased scrutiny from USCIS is who is actually working for the company in the United States. Today, adjudicators expect to see direct hires, with employees on the U.S. company’s payroll as W-2 employees, performing operational, administrative, commercial, or technical functions. At the same time, it must be clear that the transferred executive or manager has moved away from routine, day-to-day tasks and is acting primarily at a strategic or managerial level. Structures that rely almost exclusively on third parties, consultants, or independent contractors, without a sufficient in-house team, tend to be viewed with skepticism, especially when this undermines the argument that the beneficiary is performing truly executive or managerial duties.
In this context, building a real organizational hierarchy is essential. The L-1A classification presupposes that the beneficiary primarily performs strategic leadership functions or manages other managers, supervisors, and qualified professionals. In practice, USCIS expects to see a layered organization that develops over time, with an executive level responsible for strategic direction and high-level decision-making, a managerial level responsible for managing departments, teams, or key functions, a professional level composed of positions that typically require a bachelor’s degree or equivalent qualification, and an operational or administrative level that supports the company’s activities. When this structural evolution is not demonstrated, the risk increases that USCIS will conclude that the beneficiary’s role is overly operational and therefore incompatible with the L-1A classification.
In addition, when the U.S. company still relies significantly on employees of the foreign entity to provide technical, administrative, operational, or strategic support, this relationship should be properly formalized, preferably through a cost-sharing agreement or a similar intercompany services arrangement. Such an agreement should reflect operational reality, provide for proper cost allocation, define responsibilities, and demonstrate that the U.S. company is bearing its proportional share of expenses. In these scenarios, financial planning and accounting and tax compliance become especially critical, both for corporate governance and immigration purposes, as USCIS tends to closely examine whether the structure is sustainable, transparent, and consistent with the claim that there is a real and functioning U.S. operation.
Another increasingly sensitive aspect is the need to demonstrate that the U.S. company is actively “doing business” in the United States. This involves generating revenue in the U.S. market, even if at an early or growth stage, the existence of contracts, clients, and invoicing, and evidence of ongoing commercial activity rather than merely preparatory actions. A recurring red flag arises when the U.S. entity acts solely as a sales representative for a foreign manufacturer or distributor, earns only a small percentage of sales, lacks meaningful operational autonomy, and does not present a robust internal structure. In such cases, USCIS may question whether there is, in fact, a substantive business operation in the United States or merely a limited and largely formal presence.
At the same time, there has been an increase in on-site visits conducted by USCIS, particularly with respect to newer companies in the U.S. market, “new office” petitions, or recently established operations. The purpose of these inspections is to verify that the worksite actually exists and is operational, that employees are genuinely working there, that the activities described in the petition align with the company’s day-to-day reality, and that the beneficiary is performing duties consistent with an executive or managerial position. Discrepancies between what was presented to USCIS and actual operations may not only jeopardize visa renewals but also create risks of revocation and complications in future filings.
Against this backdrop, the L-1A remains an extremely valuable tool for international expansion, but only for companies willing to make a concrete investment in their U.S. operations, hire local staff, build a functional organization, and generate real economic activity in the United States. USCIS’s current focus is increasingly less on formal structures on paper and increasingly more on real, sustainable, and growing operations, making strategic planning, consistent execution, and immigration compliance inseparable elements of a successful L-1A expansion strategy.
Written by Chris Costa, Senior Immigration Attorney at Drummond Advisors