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Date: December 2002
Prepared by:
Eliot Norman, Partner, Business Immigration Group
Reed SmithLLP
Riverfront Plaza
West Tower 901 E. Byrd St., Suite 1700
Richmond, VA 23219
Tel.: +1 804 3443427
Fax: (804) 344-3410
E-Mail: enorman@reedsmith.com
Introduction
U.S. immigration law divides all individuals seeking to enter the United States generally into two categories: immigrants and nonimmigrants. “Immigrants” are individuals who are intending to remain permanently in the United States. “Nonimmigrants” are individuals coming for only a temporary stay. Those allowed to enter the United States as immigrants are permitted to have the intent to remain permanently and to abandon all foreign residence. Individuals admitted as nonimmigrants must demonstrate that they have a residence abroad which they have no intention of abandoning. There are certain nonimmigrant categories that are exempted from the foreign residence requirement which will be discussed in greater detail below, such as H-1B pro-fessional employees, and L-1 intracompany transferees.

All of the technical details, regulations and procedures regarding immigration cannot be explained in this brief Outline. However, the highlights discussed below show that workable strategies exist for establishing and expanding foreign business operations in the U.S. Current U.S. visa rules, labor and immigration laws, and bilateral trade and investment treaties offer many opportunities to transfer essential foreign personnel to U.S. operations.
Applicable Law
U.S. federal law and regulations govern the issuance of visas and permits authorizing Swiss citizens and citizens of other countries to be admitted, stay and work in the United States.

Bi-lateral Trade and Investment Treaties between Switzerland and the USA govern the issuance of E-1 and E-2 Treaty Investor and Treaty Trader Visas.
Temporary (Nonimmigrant) Visas
1.  Visa Waiver
Citizens of certain countries may enter the U.S. as visitors without a visa under the Visa Waiver Program (VWP). Swiss Nationals of the following countries do not need visas to visit the U.S.A. for ninety (90) days or less for limited business or tourist purposes.

Each year several million travelers use this “no visa” program. The visitor simply shows his round trip ticket and fills out the Waiver Application on the airplane. Effective October 26, 2004 all VWP applicants must have machine readable passports. For information on future changes in the VWP program consult www.world-visas.com.

No Visa Waiver visitor can perform local productive employment or receive a salary from a U.S. source. Visitors can perform certain work-related services similar to a B-1 visa holder, discussed below. Visitors who work must remain on the payroll of a foreign employer, although they can be advanced expenses by a U.S. affiliate.

As a general rule, no extensions or changes to another visa category are allowed in the U.S. and the visitor must return abroad (not to Canada or Mexico) before reentering the U.S. again for 90 days on the Visa Waiver or in another visa category.
2.  B-1 Business Visitor Visa
The B-1 visa is designed for temporary business activities which promote interna­tional trade, commerce or investment. The B-1 visa holder can train, consult with business associates, take orders, participate in meetings, negotiate contracts, or look for sites for investments.

B-1 visas are generally issued for a year or more (sometimes up to ten years). Entries are generally limited to six months.

A B-1 visitor can apply to extend his/her stay beyond six months without limit. However, the visitor must continue to demonstrate nonimmigrant intent.

A B-1 visa holder may change to another status. However, if an application for change is made within 30 days of entry, the USCIS (U.S. Citizenship and Immigration Services) presumes that the B entry was fraudulent, and was made with the intent to stay.

Business visitors on a B-1 visa cannot be paid a salary by a U.S. company and cannot engage in local skilled or unskilled labor (productive employment). There is a limited exception to this rule for honoraria at academic institutions, discussed below.

The regulations explicitly bar B-1 visa holders from performing skilled or unskilled labor. However, the USCIS and State Department have approved use of the B-1 visa for some limited types of work where the activities are temporary in nature but are not covered by any other visa category. Engaging in unlawful work in the U.S. can result in serious consequences for both the employer and the individual employee (including fines, deportation of the employee and inability of the employee to re-enter the U.S.).

The following are activities which are permitted using a B visa:
  • Attend a meeting of the board of directors or perform other functions resulting from membership on the board of directors of the U.S. Corporation.
  • Undertake training for a limited duration. To do so, the employee must continue to receive a salary from the foreign employer and receive no salary or other remuneration from a United States source other than an expense allowance or other reimbursement for expenses (including room and board). The consular officer must be satisfied that the intended stay in the U.S. is temporary and is indeed training and not productive employment. Foreign nationals, often students, who seek to gain practical experience should consider more appropriate nonimmigrant classifications, such as an F, H, or J visa.
  • Observe the conduct of business or other professional or vocational activity.
  • Participate in scientific, educational, professional or business conventions, conferences, or seminars.
  • Install or maintain equipment produced abroad, or train workers on the equipment, if installation, maintenance and training were part of the contract of sale with the B-1 visitor’s foreign employer.
    3.  B-2 Tourist Visa
    This is similar to a B-1, but allows entry strictly for tourist purposes. No business activities are allowed.
    4.  H-1B Visas
    Using an H-1B visa, U.S. employers are permitted to hire foreign professional employees (for example, professors, researchers or technical personnel) who have at least a four (4) year college degree, if they will work in a position requiring a college degree.

    H-1B visas are available to persons with a 4 year Baccalaureate Degree or the foreign equivalent; or (2) persons who can show by expert affidavits that their combination of education and qualifying experience is the equivalent of at least a U.S. four year B.A. or B.S. degree in the field.

    An H-1B visa is valid initially for up to three (3) years and can be extended an additional three (3) years for a total of six years, regardless of the number of employers during that time. Extensions beyond six years are available in limited circumstances.

    There are many technical requirements, including payment of a prevailing wage and the filing of a Labor Condition Application, for successful processing of an H-1B. Failure to comply with all of the H-1B regulations can result in the employer being disqualified for one year from hiring any additional H-1B specialty occupation workers, as well as other fines and penalties. Quotas on the issuance of new H-1Bs need to be considered in planning for the use of this popular visa category.
    5.  L-1 Visas: Temporary (Nonimmigrant) International Corporate Transfers
    Using an H-1B visa, U.S. employers are permitted to hire foreign professional employees (for example, professors, researchers or technical personnel) who have at least a four (4) year college degree, if they will work in a position requiring a college degree.

    H-1B visas are available to persons with a 4 year Baccalaureate Degree or the foreign equivalent; or (2) persons who can show by expert affidavits that their combination of education and qualifying experience is the equivalent of at least a U.S. four year B.A. or B.S. degree in the field.

    An H-1B visa is valid initially for up to three (3) years and can be extended an additional three (3) years for a total of six years, regardless of the number of employers during that time. Extensions beyond six years are available in limited circumstances.

    There are many technical requirements, including payment of a prevailing wage and the filing of a Labor Condition Application, for successful processing of an H-1B. Failure to comply with all of the H-1B regulations can result in the employer being disqualified for one year from hiring any additional H-1B specialty occupation workers, as well as other fines and penalties. Quotas on the issuance of new H-1Bs need to be considered in planning for the use of this popular visa category.

    5. L-1 Visas: Temporary (Nonimmigrant) International Corporate Transfers

    When a Swiss company has a related U.S. company (branch, parent, subsidiary or affiliate), U.S. immigration law allows temporary transfers (no longer than 5 or 7 years) of (1) managers, (2) executives and (3) persons with specialized knowledge to the related U.S. company under the L-1 visa category.

    To qualify as an L-1A manager or executive, the employee must show that the employee has day-to-day decision-making authority and supervises other personnel of the company or manages an important function of the business.

    To qualify as an L-1B employee with specialized knowledge, the employee must show that s/he has specialized proprietary knowledge of the company’s “product, service, research, equipment, techniques, management or other interests” as it applies to international sales and markets.

    New office L-1 visas can be issued for small companies lacking the capital to qualify under E-2 Visa Treaty Investor Regulations (see discussion below regarding E-2 visas).

    Unlike E-visas, the employee need not be of the same nationality as the foreign company. However, the employee must have worked for the overseas parent at least one full year within the 3 years preceding their first entry into the United States.

    L-1 visas are issued for an initial period of 1-3 years. The maximum time limit of L-1A visas for managers and executives is seven (7) years. L-1B visas (for specialized knowledge employees) can be renewed in two-year increments for a maximum of five (5) years.

    USCIS regulations require that decisions on L-1 visas be made in thirty (30) days or less. However, without payment of an extra fee of $1000.00 for Premium Processing, it is unlikely that a decision will be made within this time frame. Individual petitions are filed in the U.S. by the U.S. subsidiary or branch office. Approval is cabled to the U.S. Consulate in the employee’s home country for your employees to pick up their visas.

    “Blanket Petitions” can also be filed for large organizations or those having transferred at least ten (10) employees under the L-1 program during the previous year. Blanket Petitions further streamline the process by allowing the company to issue its own certificate of eligibility which the employee takes directly to the U.S. Consulate, allowing L-1A and L-1B visas to be issued in two weeks or less.

    Like the H-1B, L visa holders can permissibly have the intent to remain permanently in the U.S., which means that they can apply for a green card without jeopardizing the L-1 status.

    During the adjustment process, individuals on L and H visas can continue to work using those visas, and to travel in and out of the United States using the L or H visa. Other visa holders cannot travel outside the United States during the pendency of the adjustment application without an advance parole document (application Form I-131). In addition, adjustment applicants in visa categories other than H and L should apply for work authorization (application Form I-765) in order to work during the pendency of the adjustment process. Depending on where the application is filed, advance parole can usually be obtained within several weeks; work authorization must be issued within 90 days of filing.
    6.  E-1 Treaty Trader & E-2 Treaty Investor Visas
    Citizens of certain countries, including Switzerland, may gain entry to the United States for trade or investment using E-2 Treaty Investor and E-1 Treaty Trader visas. Because these visas can be renewed in five-year increments for 10, 20 or even 30 years or longer, they remain excellent options for many foreign businessmen.

    The E-2 Treaty Investor Visa allows you to move your entire business to the United States, or to start a new business in the U.S. if you are not now in business, or to establish or expand a U.S. branch, affiliate or subsidiary of your foreign company, or if you are a foreign owned business, to transfer to the U.S. personnel of the same nationality as the company.

    An E-2 applicant must be of the same nationality as the foreign company or investor, and the nationality must be one of the treaty countries.

    There is no minimum required investment for an E-2 investor visa. In the case of small businesses, as a general guideline, an owner investor can usually obtain E-2 status if he will (1) actively manage the small business; (2) put at risk, including borrowed funds secured for personal assets, a substantial investment in capital and/or equipment; and (3) plan to employ at least several U.S. workers. The amount of the investment varies depending upon the nature of each investment. U.S. State Department guidelines suggest that the smaller the business, the greater percentage of its value must be invested to qualify. The key is that the business cannot be “marginal,” that is, designed just to provide a living for the owner and his family.

    The E-2 visa is available to Swiss citizens under U.S. bilateral treaties or treaties of commerce and navigation.

    To qualify for an E-2 visa, the applicant must be entering the U.S. to perform either managerial or executive functions, or functions requiring essential skills. Examples of essential skills functions may include:
  • A Swiss technician for a Swiss company coming to the U.S. to maintain specialized equipment for a U.S. subsidiary.
  • A German accounting specialist coming to a U.S. branch of a German company to ensure that the books and records are maintained according to German accounting standards.
  • A technical translator for a Japanese company coming to the U.S. to translate technical documents regularly sent from the Japanese parent company.
    The E-2 visa is usually issued for an initial period of 2-5 years. There is no limit to the number of renewals.

    The spouse and children of an E-2 investor or employee also receive E-2 visas. They can also obtain work authorization in the United States under that category.

    There is a companion visa to the E-2, the E-1 Treaty Trader. To qualify, the following requirements must be met:
  • The trader’s U.S. office must engage in substantial trade with the foreign country of its shareholders. “Substantial trade” is not measured just in dollars. Frequent and continuous trade in goods or services of small dollar value may also qualify for E-1 visa treatment.
  • At least 50% of the trade must be between the U.S. business applying for the E-1 visa and the foreign country of which the employee is a citizen.
  • The U.S. business must be at least 50% owned by persons holding the same nationality as the visa applicant.
    Swiss citizens are qualified for E-1 visas. Export and import firms can qualify, as do manufacturing companies purchasing most of their equipment and parts from their parent firms. The trade does not need to be in goods. Technical know-how, blueprints, accounting advice or software engineering services, just to name a few, can qualify as trade in services for E-1 visa purposes.

    The E-1 can usually be obtained in less than thirty (30) days from most U.S. Consulates, will be valid for two to five years and can be renewed indefinitely. The immediate family members of the holder of an E-1 visa can come to the U.S. Once here, they can apply for work authorization in the United States, as long as the foreign venture partner can exercise veto control over key business decisions.

    A small, family-owned business engaging in frequent trade with the country of its foreign owners may qualify for an E-1 even if no U.S. workers are employed.
    7.  O-1 Visas
    O visas are temporary visas available for aliens of extraordinary ability in the fields of science, education, business or athletics. O visas require employer sponsorship. An O visa is an excellent alternative to the H-1B for university professors and researchers and for some corporate researchers or business persons.
    8.  F-1 Foreign Students
    Foreign students are permitted to attend U.S. colleges or universities as long as they show they have the resources to support themselves and cover all tuition and expenses and they have an intent to return to their home country. Foreign students will need a completed Form DS-2019 (issued by a university) to obtain valid F-1 status. F-1 students may be eligible for several different types of employment opportunities and very specific rules apply to each. Foreign student may be permitted to work under certain circumstances in the United States for Swiss or U.S. corporations, including full-time employment for practical training purposes for up to one year after graduation from a U.S. university.
    9.  J-1 Visas
    This visa is based on cultural exchanges between the United States and a foreign country and is a comprehensive visa covering several different categories: students, trainees, teachers, professors, international visitors, alien physicians, government visitors, researchers, short term scholars, specialist, camp counselors and au pairs. Most of these categories permit full-time work authorization for varying time units. Swiss citizens are eligible for all of these categories. Businesses find that the J-1 practical training program, which authorizes productive employment as part of a training program of 18 months duration to be quite useful in introducing foreign employees to US operations.
    10.   Business Trainee Visa Options For Up To 24 Months
    U.S. and foreign companies often wish to provide training on new or existing technologies to foreign workers. Several visas exist which allow for the training of foreign employees who do not have college degrees or specialized knowledge or cannot otherwise enter under H-1B, L-1B or E visas:
  • A J-1 trainee visa can be obtained through an international exchange program authorized by the Department of State. This category allows the trainee to work for a U.S. firm and engage in productive employment as part of her training for up to 18 months. Unlike many of the other visa options, the spouse of the J-1 trainee can be granted work authorization.
  • An H-3 training visa requires a detailed training curriculum set up by the employer. This visa allows the trainee to engage in productive employment only if it is incidental to the training. The H-3 is valid with extensions for up to two years. Specialized immigration law advice is usually needed to establish and obtain approval for an H-3 training program. Spouse and children (under 21) can enter with an H-4 but cannot work.
  • A B-1 visa can be used for short term training of less than one year. The trainee must be an employee of a foreign company. The employee must be compensated (except for expenses) by the foreign firm. Spouses and children of B-1 trainees can accompany the trainee but cannot work in the United States.
  • F-1 student visa allows for Curricular Practical Training (CPT) if the training part of the student’s degree program. Optional Practical Training (OPT) is available for up to 12 months during an academic program or 12 months post-graduation. Use of CPT for 12 months or more will void eligibility for OPT.
    Legal Permanent Residents (Green Cards)
    1.  Introduction
    Many foreigners coming to the U.S. desire to obtain permanent resident “Green Cards.” A green card allows the holder to work for any employer and to travel freely in and out of the U.S. Possessing a Green Card eliminates the need to request extensions of visas, and allows the spouse and children of the Green Card holder to work or to attend college under the lowest U.S. tuition rates. Essentially, a green card gives the holder all rights of a U.S. citizen, except the right to vote and sit on juries. A green card can be revoked upon conviction of certain crimes or upon absence from the U.S. for prolonged periods (more than six months).

    As a general rule, Green Cards can be obtained on the basis of family relationship to a U.S. citizen or permanent resident, employment or business activities; unique skills or abilities or D.V. lottery. This Outline focuses on employment Green Cards.

    The green card application (I-140 and supporting materials) must be approved by USCIS. The beneficiary must then apply for adjustment of status (if in the U.S.) or apply for consular processing (if abroad) in order to obtain the green card. Adjustment of status or consular processing involves obtaining a criminal background check, a medical exam, and verification that there are no grounds for excluding the individual from permanent residence.
    2.  First Preference (EB-1): Managers and Executives
    First Preference green cards are available to (a) Multinational Managers/Executives, (b) Persons of Extraordinary Ability in the arts, science or business or (c) outstanding researchers and professors. For most Swiss businesses, the Multinational Managers/Executives is the category of most interest to persons transferring to the USA.
    Persons who qualify for this preference category can obtain a Green Card without the lengthy delays involved in the normal Labor Certification process. Multinational Manager and Multinational Executive Green Cards can be very valuable to existing or new companies doing business in the U.S.A. As many as 40,000 manager/executive visas or “Green Cards” can be issued annually. This category has never been oversubscribed.
    Requirements to qualify for this “fast track” Green Card:
  • The U.S. company must be related to the foreign company as a branch office, affiliate, parent or subsidiary. Franchisees will not qualify as related entities. The foreign company can be a joint venture with a U.S. company so long as your foreign company exercises “negative veto control” over its operations, which usually means at least 50% ownership. This strategy works well for new companies that need an established business partner in the U.S.A.
  • The applicant/employee must have full-time managerial or executive experience with the foreign company for one (1) year during the three (3) years prior to entry into the U.S.A.
  • F-1 student visa allows for Curricular Practical Training (CPT) if the training part of the student’s degree program. Optional Practical Training (OPT) is available for up to 12 months during an academic program or 12 months post-graduation. Use of CPT for 12 months or more will void eligibility for OPT.
    The spouse and children under age 21 of the Multinational Green Card manger or executive also receive Green Cards and can work and reside permanently in the United States.
    3.  Second Preference (EB-2): Exceptional Ability and Advanced Degree Professionals
    This category is reserved for persons holding advanced degrees (M.S., Ph.D., J.D., M.B.A., M.A.) or who can demonstrate exceptional ability in the sciences or business. Green Cards in this preference category can be issued to employees of U.S. operations who have no prior experience with the parent company abroad.
    4.  Third Preference (EB-3) for Professionals holding B.S. or B.A. Degrees,
    skilled workers (requiring 2 or more years of experience) and other workers
    Labor Certification is required for the EB-3 category. In order to sponsor an employee for a green card through labor certification, the employer must show that adequate recruitment has been conducted by the employer and that there are not enough qualified U.S. workers available to fill the positions available for the job offered. This can be a lengthy and complicated process. Proposed changes in regulations may speed up the process.

    After the DOL issues a labor certification, the employer files a green card petition (form I-140) with USCIS. USCIS reviews the application to see that the foreign applicant in fact qualifies for a green card by meeting all of the requirements demanded of U.S. workers.

    Assuming the I-140 is approved, the employee is now eligible for a green card, and can apply to “adjust status” to permanent resident if a visa number is available. This involves fingerprinting, a medical exam and numerous forms.

    Under current law, full-time employees in jobs not requiring two years experience or training can still qualify for Green Cards provided that a testing of the job market under Labor Certification procedures shows that there are no U.S. citizens or permanent residents meeting minimum qualifications for the job.
    5.  Green Cards For Investors
    Another Green Card option is the Job Creation or “Million Dollar” Investment Visa.
    To be eligible for this important Permanent Resident Visa, you must:
  • Invest in and actively manage or establish policies for a “qualifying commercial enterprise” which will employ at least ten (10) U.S. workers; and
  • Be in the process of investing or have invested a minimum of $1,000,000. Certain “tar­geted areas” (rural or high unemployment) require an investment of only $500,000. Your State or local economic development agency can provide you with a list of rural and urban areas qualifying for the lower $500,000 investment rules.
    A “qualifying commercial enterprise” can be any of the following:
  • the creation of a brand new or original business; or
  • the purchase of an existing business and “simultaneous or subsequent restructuring or reorganization such that a new commercial enterprise results;” or
  • an investment in an existing business which increases its net worth and number of employees by 40%, resulting in at least ten new jobs and a new net worth which is 140% of the pre-expansion net worth; or
  • an investment in a troubled business which has been in existence for at least two (2) years and has incurred a net loss equal to at least twenty percent (20%) of its prior net worth, and the investment saves at least 10 jobs.
    The capital investment can be a combination of cash, inventory, equipment or loans, so long as borrowed funds are not secured by the assets of the new or existing enterprise. Qualified corporate/immigration counsel can assist you in properly structuring your investment and in reducing the amount of cash required. The investment capital can be from a U.S. source, such as a commercial bank, or from overseas.
    The investor can take up to two years to create the required ten (10) full-time employment positions if he submits a comprehensive business plan. A new Pilot Program liberalizes the job creation rules for investments in export related industries in “Regional Centers” approved by the Immigration and Naturalization Service (“USCIS”).
    A qualifying Investor and his spouse and children under 21 will receive Conditional Permanent Residence for two (2) years and then Permanent Residence (Green Card) based upon the continued viability of the investment.
    6.  Adjustment of Status/Consular Processing
    The final step in obtaining permanent residence is either adjusting status in the U.S. or consular processing abroad. Both processes are designed to determine if there are any grounds for excluding the beneficiary from permanent resident status. Grounds for exclusion can include certain types of diseases, criminal background, affiliation with the Nazi or Communist parties, sale or trafficking in illegal drugs, terrorist activities, etc.

    Adjustment of status applications can be filed concurrently on I-140 petition or anytime thereafter by presenting a copy of the I-140 receipt notice. Consular processing, on the other hand, cannot be filed until the I-140 petition is approved. There are pros and cons for each type of processing, so you should consult your immigration attorney to see which one is right for you.
    7.  Citizenship
    A foreign national is eligible for citizenship five years after obtaining a green card based on employment, or three years after obtaining a green card based on marriage. The citizenship application can be submitted up to 90 days prior to the five-year (or three-year) anniversary. The applicant must have “resided” in the U.S. for at least five years (three years in the case of marriage to a U.S. citizen), and must have been physically present in the United States for at least half of that period of time. Absence from the United States for more than six months creates a presumption of lapse of continuous residence. Absence for one year or more creates an absolute bar, and the five-year (or three-year) clock must begin again. There are mechanisms for preserving continuous residence which are beyond the scope of this handbook. Switzerland recognizes dual citizenship for its nationals.
    Frequently Asked Questions
    Do I need a visa to visit the United States?
    Swiss citizens can visit the USA for business or tourist purposes for up to 90 days without a visa, provided they have a machine readable passport and a roundtrip airline ticket.

    What visas are best for opening a branch office of a Swiss company in the USA?
    Generally, Swiss companies use the L-1 Intracompany Transfer and E-2 Treaty Investor Visas in starting up branch offices in the USA.

    How much does it cost to obtain visas?
    The website of the U.S. Embassy advises on fees for visa issuance, which in most cases are $100.00. For many visas, however, an application must be made first in the USA with the USCIS (U.S. Citizenship and Immigration Services). Filing fees in the USA for applications or petitions for temporary business visas can range from $1500 to $2500. In addition, you can expect to pay fees to immigration lawyers in the range of $2000 or more for temporary visas; and $5000 or more for Green Cards (legal permanent residence).

    I have heard that the new Department of Homeland Security is imposing new restrictions on the issuance of visas?
    There are still many pro-business options available under U.S. immigration laws. But the rules dealing with working without permission and overstaying, even on tourist visas, are now being strictly enforced. Interviews are now required before visas are issued. You should check the website of your closest U.S. Embassy for advice on changes in visa procedures. Do not assume that the visa or procedure you used in 1999 will work in 2005. When in doubt, you should consult a U.S. immigration law expert before you apply for the visa.

    If I transfer to the USA, can my spouse work?
    There are a number of corporate visas, including the L-1 and E-1/E-2 which authorize employment by the spouse. Often, the spouse can independently qualify for a work visa through use of the J-1 (practical training) and H-1B (professional or specialty occupation) categories. You should consult your immigration law advisor before making the decision to come to the USA if employment of both spouses is a critical part of your decision making process.
    Useful Links
  •  
  • U.S. Citizenship and Immigration Services (USCIS)
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  • US Embassy