Avoiding Problems over B-1 Buiness Visits

Question: If a Canadian citizen is admitted entry to the United States under B-1 visa status for a Canadian corporation, would establishing a separate U.S. corporation (assuming the individual would simply be a member of the Board of Directors and not an employee) violate the terms of immigration?

Answer: Simply being a member of the Board of Directors of a U.S. company should not violate the terms of an individual's B-1 status. However, there may be issues if this activity is not consistent with the initial purpose of the B-1 entry. Additionally, any time a foreign national is involved in a U.S. company (e.g. establishing, or having an ownership interest in the company), this may pose a problem to U.S. border inspectors (CBP).

The basic parameters of the B-1 category are as follows:

  1. The applicant maintains a residence in a foreign country that he/she has no intention of abandoning.
  2. The applicant only temporarily visits the United States.
  3. The applicant does not engage in actual, gainful employment (such as management or executive job tasks).
  4. The applicant only engages in limited business activities such as: Contract negotiations; Litigation; Independent research; Taking purchase orders; Consultation with business associates; Participation in conventions, conferences and seminars.
  5. The applicant does not receive compensation from any U.S. source for the activities performed in the U.S.

Attending meetings of the Board of Directors of a U.S. corporation is specifically referenced as a permissible activity under the B-1 category. See Inspectors Field Manual Chapter 15.4. However, if a person has already been admitted to the U.S. as a B-1 visitor, it must be assessed whether this activity is consistent with the initial purpose of the entry as stated to any CBP inspecting officer. If this activity is inconsistent with the initial terms of the entry, CBP may later determine that the individual violated his/her B-1 status. Similarly, if CBP becomes aware of this activity, they may question whether a B-1 visitor has violated his/her status by improperly working for the newly formed U.S. company.

Either of these determinations can lead to a denial of re-entry to the U.S. under the B-1. If CBP believes there was fraud involved, such a charge could also result in an expedited removal order and/or a permanent bar to the U.S. Individuals in this situation need to make sure the proposed activity is consistent with the initial terms of their stay; confirm that the activity is permissible under the B-1 visa classification; and if so, retain evidence of their activities in the U.S.  These materials may help overcome accusations at the border that the person no longer qualifies for the B-1 visitor category or that he/she violated the terms of the B-1.