United States Citizenship and Immigration Services (USCIS) has announced that two decisions from its Administrative Appeals Office (AAO) will be binding precedent for the agency, i.e., USCIS must follow the decisions’ holdings when evaluating future petitions. AAO precedent decisions result from a collaboration between the Department of Homeland Security and the Department of Justice. The two decisions are not new, having been decided in 2005 and 2006, but it was not until October 20, 2010, that both were deemed binding.

The first decision, Matter of Al Wazzan (pdf), affirms USCIS’s denial of an application to adjust status to permanent residence and holds that an employment-based petition must be "valid" initially if it is to "remain valid with respect to a new job."

The second decision, Matter of Chawathe (pdf), reverses USCIS’s denial of an application to preserve residence for naturalization purposes and clarifies the definition of employment by an "American firm or corporation."

Matter of Al Wazzan

In Matter of Al Wazzan, 25 I&N Dec. 359 (AAO 2010) [initially decided Jan. 12, 2005], the applicant’s employer filed an initial immigrant visa petition in 1998, which the director denied on February 2, 2000. An appeal was dismissed on January 8, 2001. The employer filed a second petition on August 26, 2002, and the applicant filed an application for adjustment of status on September 18, 2002 – both were denied over one year later, in August and September 2003, respectively.

The applicant argued that the director erred in denying his application for adjustment of status because resolution took over 180 days. This argument was based on a 2000 amendment to 8 U.S.C. § 1182(a)(5)(A)(iv), which stated that:

A petition . . . for an individual whose application for adjustment of status . . . has been filed and remained unadjudicated for 180 days or more shall remain valid with respect to a new job if the individual changes jobs or employers if the new job is in the same or a similar occupational classification as the job for which the petition was filed.

The applicant contended that the petition became “valid” if the agency did not resolve the matter within six months. The AAO noted that this interpretation would have immigration courts “construe the term ‘valid’ to include denied or unadjudicated petitions.”

The AAO found no basis for the applicant’s interpretation. After examining the statute’s plain language, legislative history, prior immigration decisions, and recognizing that petitions could only be approved after USCIS investigated a petition and determined eligibility, it concluded that it “would be irrational to believe that Congress intended to throw out the entire statutorily mandated scheme regulating immigrant visas whenever that scheme requires more than 180 days to effectuate.”

Concerning petitioner’s argument that the legislative intent was to alleviate immigration petition backlogs, the AAO held this interpretation “would create a situation where ineligible aliens would gain a ‘valid’ visa simply by filing frivolous visa petitions and adjustment applications, thereby increasing USCIS backlogs, in the hopes that the application might remain unadjudicated for 180 days.”

Accordingly, because the applicant’s visa petition had been properly denied, the applicant was ineligible to have his immigration status adjusted and denial of the applications was proper.

Matter of Chawathe

The primary question presented in Matter of Chawathe, 25 I&N Dec. 369 (AAO 2010) [initially decided Jan. 11, 2006], was “whether a publicly traded corporation may be considered an ‘American firm or corporation,’ [for immigration law purposes]... when its stock ownership is widely dispersed and there is no readily available means to determine the nationality of its owners.”

In Chawathe, the applicant was a U.S. permanent resident who intended to apply for U.S. citizenship, but would be working overseas for between two to three years. To qualify for citizenship, the applicant would need to reside continuously in the U.S. as a lawful permanent resident for the five years prior to filing an application, and be physically present in the United States for at least half of the residency period. However, the law provides that no period of absence from the United States will break the residency continuity if the individual was: (1) physically present and residing in the U.S., after gaining permanent residency, for an uninterrupted one-year period; and (2) employed by an “American firm or corporation” or subsidiary thereof.

Seeking to preserve his U.S. residency, the applicant filed the required preservation of residency petition. The director denied the petition based on two determinations: (1) that the applicant did not work for an American firm or corporation; and (2) that the applicant’s temporary overseas employer did not qualify as a subsidiary of an American firm or corporation. The applicant appealed both determinations.

American Firm or Corporation

The AAO held that a company’s incorporation in a U.S. state does not in itself establish the entity as an American firm or corporation. To qualify, more than 50% of the company must be owned by American citizens. In Chawathe, proving ownership would be an onerous task: the applicant’s employer was a publicly-traded company on the New York and San Francisco stock exchanges that could issue 4.1 billion shares, so the applicant would need to demonstrate that American citizens owned more than 2.05 billion shares. Understanding the difficulty of tracing nationalities and ownership interests of public companies, the AAO found it “reasonable to presume” a public company qualified as an American firm or corporation for immigration law purposes if the company was both incorporated in the United States and traded its stock exclusively on U.S. stock markets.

Subsidiaries

The AAO also concluded that the applicant had demonstrated that his temporary overseas employer was a subsidiary of an American firm or corporation. The temporary overseas employer was listed as a subsidiary in the company’s Securities and Exchange Commission (SEC) filings. Moreover, the applicant provided a letter from the American company’s Assistant to the President stating that the temporary overseas employer was a wholly-owned subsidiary, and that although the applicant would be working for the temporary overseas employer for two to three years his salary would be paid by the American company. The AAO held that, although the applicant could have provided more probative evidence of the temporary overseas employer’s subsidiary status, the SEC filing and corporate letter established, by a preponderance of the evidence, that the temporary overseas employer was a wholly-owned subsidiary of the applicant’s American employer. Because qualifying for citizenship based on permanent resident status only required the applicant to prove his eligibility by a preponderance of the evidence (compared to the heightened standard of “clear and convincing evidence” for petitions based on marriage), he provided sufficient evidence for the director to conclude that “more likely than not” the applicant satisfied his burden of proof.

Accordingly, the AAO sustained the appeal, finding the employer an American firm or corporation and the temporary overseas employer a qualifying subsidiary, and concluding that the applicant met the requirements for preserving his U.S. residency while abroad.