Small Company with Annual Losses Granted L-1 Extension

Year: 2019
Nationality: French
Beneficiary : David
Company Industry: Petroleum Development
French company: founded in France in 1988, 40 employees
US company: Established in 2005 in Texas, 8 employees
Beneficiary position: General Manager of a US company

Application timeline:
11/20/2019 Send out L-1 extension petition
11/22/2019 Immigration Intake
11/27/2019 USCIS Grants L-1 Extension for Two Years

BACKGROUND
– Poor financial position of the U.S. company: although the company was established in 2005, the operating conditions have been unstable, and the company has been losing money for the past three years, with losses reaching $200,000 in 2018 and no signs of turning losses into profits in the short term.
– U.S. companies operate on a small scale: the number of employees has been under 10 since the company was established 14 years ago, and the slow progress of staff expansion can easily lead immigration officers to question whether the applicant is engaged in the company’s executive duties? Or is he or she just doing the work of a first line supervisor?
– The future of the U. S. company is uncertain: The company will change its strategy at this stage and does not intend to continue to focus on its business in the U.S. domestic market, but to shift its business focus to Central and South America, so the U.S. office may be further downsized.

In 2017, David’s U.S. employer contacted Tsang & Associates through a friend’s referral and engaged us to prepare his first L-1 petition, submitted the expedited fee, and was successfully notified of his approval within two weeks. For David’s extension this time, his employer did not hesitate to contact us to help him apply for the extension.

However, the terms of David’s extension were not optimistic. The company’s tax bill had been losing money for three consecutive years and the amount of loss was on the rise, and not only that, the scale of the company did not grow as smoothly as expected after David became the general manager. Despite the challenges of the extension, the Tsang & Associates team prepared the extension application for David with extensive experience.

KEYS TO SUCCESS
Poor financial situation?
Even though the U.S. company’s tax returns were not impressive, Tsang & Associates was able to demonstrate that the parent company was financially strong enough to support the U.S. company’s operations by submitting various financial statements from the parent company. In addition, we also explained in our attorney support letter the company’s financial flow and the expected revenue from future projects, demonstrating that the losses at this stage are still within a reasonable and manageable range.

Small scale of operation and questionable executive responsibilities?
Tsang & Associates also argued strongly for David in a letter of support from counsel for one of the most critical reasons for triggering the L-1 filing. While we acknowledge that his U.S. employer is not a large company, we also emphasize that the key to a company’s operations does not lie in its size. Good growth requires a combination of market acumen, customer satisfaction and efficient service, even when the company is small. Therefore, the person who plans, evaluates, and sets the direction of the company’s goals is critical to its success, and the position of “General Manager” is just such an important role. We then explained David’s day-to-day responsibilities in the U.S. Although David has only a high school education and did not attend college, his extensive experience with the parent company over the past decade makes up for his lack of education and proves him worthy of the executive position of “General Manager”.

Unclear development prospects?
Based on the experience of the past few years, the U.S. firm decided not to focus on its home market business, but to switch its strategy and look farther ahead to expand its business in the entire American market, especially to develop partners in Central and South America. Prior to the extension, the U.S. employer specifically informed Tsang & Associates of the plan and asked if there would be any adverse impact on the extension. Tsang & Associates’ professional business team created a detailed business plan based on the employer’s description, including the company’s “five-year plan,” financial projections, and analysis of the partnership, so that the immigration officer would have a good impression of the company’s prospects when reviewing the documents. A good impression of the company’s development prospects.

OUTCOME
After thorough preparation, Tsang & Associates filed David’s L-1 extension petition in November 2019, opting for expedited processing, and received an email from USCIS informing him of the approval in 5 days, and soon received a paper I-797 approval notice. David and his employer were very surprised when they received the news. They did not expect their extension to be approved under such unfavorable conditions, and were very glad that they had chosen Tsang & Associates to make their L-1 petition go smoothly from the initial filing to the extension.

*To protect customer privacy, customer names are pseudonyms.