Report Shows Disproportionate L1B Denial Rate for Indian Nationals

In the United States, immigration laws typically are designed to provide U.S. companies with the tools necessary to compete and even thrive in the modern day global business environment. One such tool is the L1B nonimmigrant category, which ostensibly was created to allow multinational companies to transfer overseas employees with specialized knowledge and skills to related companies (e.g., affiliates, subsidiaries) in the U.S. In recent years, however, it has been well-publicized that the U.S. Citizenship and Immigration Services (USCIS) has been interpreting the L1B regulations unevenly and, in many cases, rather strictly, making it harder and harder for businesses to rely on the L1B category.

So, when the National Foundation for American Policy (NFAP), a nonprofit, nonpartisan organization dedicated to public policy research, released a report in March 2015 showing that the denial rate for L1B petitions has continued to skyrocket in recent years, the news was discouraging, but hardly surprising. This report, which is based on data obtained from the USCIS via Freedom of Information Act (FOIA) requests, uncovers another unsavory fact, though: the USCIS appears to be treating L1B petitions filed on behalf of Indian nationals far more critically than those filed for foreign nationals from any other country. [See L-1 Denial Rates Increase Again For High Skill Foreign Nationals, NFAP March 2015 Policy Brief, by National Foundation for American Policy, March 2015.]

As recently as 2006, the overall denial rate for L1B petitions was six percent. By fiscal year 2008, however, more than 20 percent of all L1B petitions filed were denied; and, by the end of 2014, the denial rate had ballooned to 35 percent. This exponential increase of L1B denials by the USCIS is troubling enough, especially considering the fact that no new regulations were issued over that timeframe that should have impacted how these cases were being adjudicated. But, this record-high rate of denial is hardly being borne equally across the globe. Rather, as highlighted in the NFAP report, if you remove petitions filed on behalf of Indians from the equation, the overall denial rate plummets to 13 percent. That is because the rate of denial for Indian nationals from fiscal year 2012 through fiscal year 2014 was an astounding 56 percent!

To be clear, even the 13 percent denial rate non-Indians faced for L1B petitions is far too high. There have long been complaints about the vague rules and regulations provided by the USCIS with regard to these cases. So, it was a relief to see that, on March 24, 2015, the USCIS finally unveiled a draft policy memorandum on the L1B classification that is intended to clarify what USCIS officers should be looking for when adjudicating these petitions. There is some expectation that this memo may help to provide more certainty to the process and make it easier for businesses to understand what evidence and information to submit to obtain approvals. But, the memo does nothing to address the enormous disparity in denial rates between those L1B petitions filed on behalf of Indian nationals and those filed for everyone else.

The United States is renowned for being a champion of fairness and justice; therefore, the NFAP should be applauded for its continued efforts to expose these alarming trends. The Murthy Law Firm is exploring ways of further addressing these concerns with the USCIS.

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