Immigration Law Update from Challa Law Offices.

Corporate Restructuring: How does this affect my immigration filings?

In today's dynamic, recovering economy, mergers and acquisitions of companies are increasingly common. Corporate restructuring, specifically mergers and acquisitions may significantly impact the status of either company's immigration filings. The exact consequence depends on the type of filing in question, and the type of corporate change.

L-1 Petitions:

The key question is whether the corporate change alters the qualifying corporate relationship with the relevant foreign entity.

If the US entity will still retain its same relationship with the foreign entity or entities, no change in the filing is required.

If the US entity's relationship with the foreign entity is changed, but still exists and is still a qualifying relationship for purposes of the L, the US entity must file an amended petition to reflect the changed relationship.

If the US entity will no longer have the relationship with the foreign entity, the L petitions will no longer be valid. In that case, the employer must either transfer the L employees outside the US, or file change of status petitions to H-1B, if possible.

If there is a full asset and liability acquisition, the acquiring company acquires the "history" of the acquired company's employees for purposes of the L. This means that if a foreign national worked for one year out of the past three years for the acquired company's foreign entity, and if that person otherwise qualifies for the L-1, that person can be transferred to the acquiring company on the L.

H-1B Petitions:

New or amended H-1B petitions are not required when the current H-1B employer is involved in a corporate restructuring, including a merger or acquisition as long as the following conditions are met:

The new entity assumes all of the obligations and rights of the predecessor companies, and

The terms and conditions of the H-1B employment remain the same.

Further, no new LCAs must be filed if the above conditions are met. However, the new employer must include a "sworn statement" in the public access file that it "accepts all obligations, liabilities and undertakings under the LCAs filed by the predecessor entity" with a list of all affected LCAs and its date of certification, and a description of the actual wage system and FEIN of the new employer. 20 C.F.R. § 655.760(a)(7). However, the H-1B employer must continue to work in the same location and continue the same job duties to keep working on the same LCA. If the job location changes, a new LCA must be filed before the employee reports to the new worksite. If the job duties change substantially, an amended petition must be filed. Regardless of the type of corporate restructuring, corporate management must carefully review the immigration status of all affected employees to ensure full compliance with immigration laws and regulations to ensure smooth immigration processing later, and to ensure seamless review in the event of an audit.