A luxury of the prosperous relationship between the U.S. and Canada is the relative ease with which citizens of either country can enter the other. Canadian citizens may enter the U.S. to perform a wide variety of business-related activities without employment authorization. If entering the U.S. at a land border, they typically are not provided with any evidence of their immigration status. If entering by air, they are issued an electronic I-94 record, which is accessible on the U.S. Customs and Border Protection website (www.cbp.gov/i94). Whether they receive an I-94 or not, these individuals are being admitted to the U.S. in B-1 status as a business visitor. Business visitors are admitted for a presumptive period of up to six months unless they are issued an I-94 that is valid for a shorter period.
Individuals may be admitted to the U.S. in B-1 status in order to participate in training, attend conferences, negotiate contracts, observe business operations, attend meetings and other activities of a commercial or professional nature. However, with limited exceptions, B-1 status does not allow the individual to perform local labor for hire in the U.S. An individual in B-1 status may not hire or fire anyone or engage in hands-on work. In addition, they must continue to be paid by a foreign employer, must intend to depart the U.S. at the conclusion of the stay, and must maintain a residence abroad that they have no intention of abandoning.
The scope of permissible B-1 activities is a legal gray area, but the clearest definition comes from Matter of Hira, 11 I. & N. Dec. 824 (B.I.A. 1966) (aff’d by A.G. in 1966), a case involving a tailor measuring customers in the U.S. for suits to be manufactured and shipped from outside the U.S. These were found to be appropriate B-1 activities because the principal place of business and the actual place of accrual of profits, if any, was in the foreign country.
Often, Canadian citizens who are looking to establish a U.S. enterprise that will later support an investor visa application enter the U.S. The Foreign Affairs Manual at 9 FAM 402.2-5(c)(7) expressly permits prospective investors to enter the U.S. in B-1 status to “examine or monitor potential qualifying investments” provided that they do not perform productive labor or actively participate in the management of the business. The line between examining investment opportunities and performing productive labor is often not clear.
With each application for B-1 admission, the individual must convince U.S. Customs & Border Protection (CBP) that they qualify for B-1 status. Even if an individual is engaged in legitimate B-1 activities, CBP officers will often deny entry if the individual is making numerous trips to the U.S. or is spending a great deal of time in the U.S., as they assume the person is working. Once this happens, the person will be detained and questioned at each entry. The safest option is often to apply for an employment-authorized status to avoid continued scrutiny.
Danielle M. Rizzo, Partner and member of the Immigration Practice Team at Phillips Lytle, can be reached at 716-847-5484 or drizzo@phillipslytle.com.
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