Interim Decision #2201
MATTER OF Ko
In Section 245 Proceedings
A-19892048
Decided by Deputy Associate Commissioner May 9, 1973
(1) "Engaging" in an enterprise within the purview of 8 CFR 212.8(b)(4) contemplates full-time engagement to an extent which demonstrates an assumption
of risk and responsibility for the direction and control of the enterprise.
(2) The labor certification requirement of section 212(a)(14) of the Immigration
and Nationality Act, as amended, is inapplicable to an alien who establishes
that he is seeking to enter the United States with the bona fide primary
purpose of engaging in an enterprise in which he has already invested or is
presently investing a substantial amount of 'capital. Hence, an applicant for
adjustment of status under section 245 of the Act who in good faith has
invested $18,000 in a retail shoe business which he manages and directs full-time is not within the purview of section 212(aX14) of the Act, notwithstanding
the fact that he also performs the duties of cashier in the store.
(3) A request for a labor certification exemption as an investor filed prior to
February 12, 1973, the effective date of the amendment of 8 CFR 212.8(b)(4) (38
P.R. 1379), may be decided under either the regulation as amended on that
date or as it existed prior thereto, whichever is more favorable to the alien.
ON BEHALF OF APPLICANT: Ruth Shamir, Attorney at Law
Suite 1800, 5670 Wilshire Boulevard
Los Angeles, California 90036
This case comes forward on certification for decision by the
Deputy Associate Commissioner, Travel Control. The District Director on January 18, 1973, denied the application on the ground
that the applicant is subject to the requirement of section
212(aX14) of the Immigration and Nationality Act, as amended;
does not have the labor certification for which that section provides; and is, therefore, inadmissible to the United States for
permanent residence. The Regional Commissioner, to whom the
District Director certified his decision, affirmed the denial and in
turn certified his decision here.
The adjustment application in this case was filed in June 1971,
at which time the applicant alleged that although he is an
intending nonpreference immigrant, he is not within the class of
aliens excludable from admission under section 212(aX14) of the
349
Interim Decision #2201
Immigration and Nationality Act, as amended, because as an
"investor" and by regulation (8 CFR 212.8(bX4)) he is not required
to obtain the otherwise prescribed labor certification. Section
212(aX14) describes as ineligible for visas and for admission to the
United States:
(14) Aliens seeking to enter the United States, for the purpose of performing
skilled or unskilled labor, unless the Secretary of Labor has determined and
certified to the Secretary of State and to the Attorney General that (A) there
are not sufficient workers in the United States who are able, willing, qualified,
and available at the time of application for a visa and admission to the United
States and at the place to which the alien is destined to perform such skilled
or unskilled labor, and (B) the employment of such aliens will not adversely
affect the wages and working conditions of workers in the United States
similarly employed. The exclusion of aliens under this paragraph shall apply
to special immigrants defined in section 101(aX27)(A) (other than the parents,
spouses, or children of United States citizens or of aliens lawfully admitted to
the United States for permanent residence), to preference immigrant aliens
described in section 203(a)(3) and (6), and to nonpreference immigrant aliens
described in section 203(0(0 ... (8 U.S.C. 1182(a)(14))
The regulation (8 CFR 212.8(b)(4)), as it was when this adjustment application was filed, read:
(b) Aliens not required to obtain labor certifications. The following persons
are not considered to be within the purview of section 212(a)(14) of the Act and
do not require a labor certification: ... (4) an alien who will engage in a
commercial or agricultural enterprise in which he had invested or is actively
in the process of investing a substantial amount of capital.
The applicant has testified that he is in the business of selling
new shoes and that he has a retail store for this purpose in
Huntington Park, California. He has presented evidence that he
started this business in February 1971, with an initial investment
of $18,000, the proceeds from the sale of a grocery market which he
previously owned and operated for a year in Argentina. With that
money he leased premises for his present retail business, fitted
them out with furniture and fixtures, secured occupancy and
seller's permits, and purchased stock in trade; and he now has one
full-time and one part-time employee working in the business
besides himself. He oversees, manages and directs this enterprise;
monitors, and purchases its stock; and works, as well, as the
cashier in the store.
The District Director in his decision states that the law is clear
and without qualification in requiring a labor certification of a
nonpreference immigrant who will be performing skilled or unskilled labor; that the work of a cashier is such labor; and that to
perform it, the nonpreference immigrant must have the Secretary
of Labor's certification, notwithstanding any investment he may
have made; and that since a valid regulation may not go beyond
the scope of the law it implements, the regulation here must be
350
Interim Decision #2201
read as restricting its benefits solely to the investor described
therein who will not be performing skilled or unskilled labor in the
United States. I believe that this is an unnecessarily rigid interpretation of section 212(aX14).
It is certainly clear, as the District Director and Regional
Commissioner indicate, that section 212(aX14) was included in the
law to assure protection for American labor from alien workers
who would offer unwarranted competition. The House Committee
on the Judiciary in recommending the passage of H.R. 2580, which
contained what was to become the present section 212(aX14),
stated that it would assure among other things:
Safeguards to protect the American economy from job competition and from
adverse working standards as a consequence of immigrant workers entering
the labor market. (House Report No. 745, 89th Congress, 1st Session, August 6,
1965, page 18).
The Committee observed also that:
Section 212(aX14) of the Immigration and Nationality Act is restated so as to
require an affirmative finding by the Secretary of Labor that any alien
seeking to enter the United States as a worker, skilled or otherwise, will not
replace a worker in the United States nor will the employment of such alien
adversely affect the wages and work ing conditions of individuals in the United
States similarly employed. This required certification will be applicable to
special immigrants (other than the parents, spouses, and minor children of
U.S. citizens or permanent resident aliens), preference immigrants described
in section 206(a)(3) and (6) and the nonpreference immigrants. (Id., page 21).
In considering all of this, it is not unreasonable to conclude that
it was not the purpose of Congress in this section to discourage an
alien's bona fide effort to establish and conduct his own business
here, where his stake in that business is to be substantial and
irrevocably committed, and where there are encouraging prospects for its success. It cannot be said in any real sense that the
applicant's employment in a job that did not exist before he ma*
his investment is unfairly competitive with American labor. His
employment in his own business is not the "job competition" which
the Congress wished to protect against. His conduct of his business
does not "replace a worker in the United States" or "adversely
affect the wages and working conditions of individuals in the
United States similarly employed!' His efforts have, in fact,
created jobs for two American residents.
It is my opinion, therefore, that Congress did not intend the
provisions of section 212(aX14) to be applicable to the alien who can
establish that he is seeking to enter the United States with the
bona fide primary purpose of engaging in an enterprise in which
he has already invested or is presently investing a substantial
amount of capital. The regulation's requirement that the alien
must have the intention of engaging in the enterprise in which he
351
Interim Decision #2201
has invested or is investing is deliberate. Its object is to have him
participate full time in that enterprise, thereby assuring that he
does not evade the certification requirement of section 212(aX14)
by merely making the investment and then devoting no effort or
only part-time effort to the enterprise, while being employed
elsewhere in competitio.. with American workers. The regulation
contemplates that the investor's "engaging" in the enterprise will
be to an extent which demonstrates an assumption of risk and
responsibility for its direction and control. If he is engaged full
time to the extent indicated above—and I find that the applicant
here is—it is immaterial what his nominal job in the enterprise
may be.
Before leaving this matter, some observations on related aspects
should be made. Between the District Director's decision of January 18, 1973, and the Regional Commissioner's determination on
February 22, 1973, a changed text of the relevant regulation (8
CFR 212.8(bX4)) became operative: In order to further clarify the
rule, there were published on January 12, 1973 (38 FR 1379), to
become effective on February 12, 1973, requirements that the
minimum capital investment be $10,000 and that the alien establish that he has had at least one year's qualifying experience or
training. So the regulation now provides that the certification
exemption is available to:
An alien who establishes on Form 1-526 that he is seeking to enter the United
States for the purpose of engaging in a commercial or agricultural enterprise
in which he has invested, or is actively in the process of investing, capital
totaling at least $10,000, and who establishes that he has had at least 1 year's
experience or training qualifying him to engage in such enterprise.
It has been administratively determined by the Service that any
request for labor certification exemption as an "investor" filed
previous to February 12, 1973, may be decided under either the
current or previous regulation, whichever is more favorable to the
alien. In his decision affirming the denial in the present case, and
by way of dictum, the Regional Commissioner has stated that the
applicant here would not qualify under the experience requirement of the present regulation either. He bases this conclusion on
the holding apparently that self-employment in his grocery business in Argentina is different substantially from self-employment
in a retail shoe store in the Los Angeles metropolitan area. With
respect to that I would say the experience necessary to qualify
under the present regulation need not be in the same kind of
business.
The Service obviously is in no position to predict that the
investor's enterprise will succeed. It may fail and force the investor to seek employment elsewhere and in competition with U.S.
352
Interim Decision #2201
resident workers. The regulatory requirement that he establish
that he has had at least one year's experience or training qualifying him to engage in the enterprise is designed to give the Service
some further measure of assurance that he has at least the "knowhow" to participate meaningfully in the operation of the enterprise
which then presumably would have a reasonable chance to succeed. When a difference exists between the nature of the business
in which the alien was previously engaged and that of the
business in which he is now investing or has invested in the
United States, he may be able to establish that his previous
experience or training as an entrepreneur or manager for a year
or more meets the experience or training requirement of the
regulation.
The present application will be returned to the District Director
for further consideration not inconsistent with the above.
ORDER: It is ordered that the application be remanded to the
District Director for disposition in conformity with this opinion.
353
