Interim Decision #3008 

MATTER OF SIEMENS MEDICAL SYSTEMS, INC. 

In Visa Petition Proceedings 

DEN-N-8540 

Decided by Commissioner March S2, 1986 

(1) Where each of two corporations (parents) owns and controls 50 percent of a third 

corporation (joint venture), the joint venture is a subsidiary of each of the parents 

for purposes of section 10l(aX15KL) of the Immigration and Nationality Act, 8 

U.S.C. § 110KaX15KL) (1982). Matter of Hughes, 18 I&N Dec. 289 fComm. 1982) 

clarified. 

(2) Each parent, through ownership and control of 50 percent of the voting shares of 

the joint venture, has the power to prevent action by that company through exercise of its veto power; hence, each parent "negatively" controls that company. 

(3) All agreements between the parents relating to voting of the shares, distribution 

of profits, management and direction of Hie subsidiary, and similar factors which 

affect actual control over 50 percent of the subsidiary must be identified. Unless 

such agreements restrict the actual control of one parent, the 50-percent ownership will be deemed per se control. 

ON BEHALF OF PETITIONER: Martin R. Greenberg, Esquire 

60 East 42nd Street 

New York, New York 10165 

This appeal is before the Commissioner from the February 27, 

1985, decision of the district director denying the visa petition to 

classify the beneficiary under section 101(aX15KL) of the Immigration and Nationality Act, 8 U.S.C. § 101(aX15)(L) (1982). The district 

director found that the petitioner had failed to establish an affiliation with the beneficiary's foreign employer. The appeal will be 

sustained. 

I. FACTS 

The petitioner, Siemens Medical Systems, Inc., seeks to classify 

the beneficiary as an intracompany transferee under section 

101(a)(l5XL) of the Act to enable the beneficiary to provide services 

as a senior technical representative for medical x-ray equipment 

for its operation in the United States. Section 101(aX15XL) requires 

the beneficiary to be coming to the United States to continue em362 
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ployment in a managerial, executive, or specialized knowledge capacity with the same employer, its parent, branch, subsidiary, or 

affiliate with which the beneficiary was continuously employed 

abroad for the immediate prior year. 

The petitioner is a United States wholly-owned subsidiary of Siemens AG, a multinational corporation headquartered in West Germany, and is involved in the development and sale of medical and 

dental equipment and systems. The beneficiary was employed as an 

x-ray engineer by wholly-owned subsidiaries of Siemens AG from 

1975 until 1982. In July 1982, the beneficiary was transferred to 

Hospitalia International GmbH, a 50-50 joint venture between Siemens AG and Phillips International, to work on an x-ray maintenance project at King Hussein Medical Center, Amman, Jordan. 

After the project terminated in January 19S5, he was reassigned to 

Siemens AG headquarters. 

II. CASE HISTORY, DECISION, AND APPEAL 

The petition was filed on February 14, 1985. On February 27, 

1985, the district director denied the petition after determining, following Matter of Hughes, 18 I&N Dec. 289 (Comm. 1982), that the 

petitioner submitted no evidence that Siemens AG controls Hospitalia International and, therefore, failed to establish that affiliation 

exists between Siemens Medical Systems and Hospitalia International. On April 15, 1985, the petitioner filed a motion to reopen 

and reconsider in which it argued that the beneficiary's identity as 

an employee of Siemens AG was not terminated or otherwise affected by his assignment to Hospitalia. The district director denied 

the motion, noting that there is nothing in the record to indicate 

that the beneficiary should be considered an employee of Siemens 

during the time he was at Hospitalia; nor is there evidence that 

Siemens exercises control over the management or policies of Hospitalia, which is required for affiliation. 

On appeal, the petitioner contends that a qualifying affiliation 

under the statute exists between itself and Hospitalia through Siemens AG and makes the following argument: 

Control does not nor should not mean total control. In the case at hand, it has 

previously been documented that Siemens AG supplies most of the technical personnel to Hospitalia International and owns 60% of the assets and 50% of the 

outstanding shares of stock in Hospitalia International. These three items, as indicated in the above section, should be sufficient to show control in order to establish affiliation as is defined under the immigration laws. However, it should be 

further noted that Siemens AG also participates in profits from Hospitalia International on a 50-50 basis; Hospitalia International's board of directors is comprised by 50% of people from Siemens AG; Hospitalia International does not man363 
Interim Decision #3008 

ufacture equipment, but installs all necessities used in hospitals—to wit, beds, xray machinery, and other diagnostic equipment, The medical equipment used by 

Hospitalia International in the equipping of these hospitals is manufactured by 

Siemens AG. 

The petitioner also notes that the beneficiary's identity as an employee of Siemens AG remained constant despite the beneficiary's 

assignment to Hospitalia. When the beneficiary went to Hospitalia 

International, he was assigned by Siemens AG and did not seek 

employment with Hospitalia International on his own volition and, 

at the end of his term with Hospitalia International, remained an 

employee of Siemens AG. 

III. ANALYSIS AND CONCLUSION 

Classification under section 101(aX15XL) of the Act requires consideration of several factors including, among others, whether or 

not there is a qualifying relationship between the petitioner and 

the entity from which the beneficiary will be transferred; whether 

or not the beneficiary has been employed abroad continuously for 

the immediate prior year in a managerial, executive, or specialized 

knowledge capacity by a parent, branch, subsidiary, or affiliate of 

the petitioner; and whether the proposed employment in the 

United States will be in a qualifying capacity. 

A. RELATIONSHIP BETWEEN THE ENTITIES 

In this case, it must be established that there is a qualifying relationship between Siemens Medical Systems, Inc. (a wholly-owned 

subsidiary of Siemens AG) and Hospitalia International GmbH (a 

50-50 joint venture established by Siemens AG and Phillips International). 

The Service will accept the interpretation that a 50-50 joint venture creates a subsidiary relationship for purposes of section 

101(aX15XL) of the Act. Where each of two corporations (parents) 

owns and controls 50 percent of a third corporation (joint venture), 

the joint venture is a subsidiary of each of the parents. There is no 

majority control, but where each parent through ownership and 

control of 50 percent of the voting shares of the joint venture has 

the power to prevent action by that company through exercise of 

its veto power, it "negatively" controls that company. That company is, therefore, properly regarded as a subsidiary of each parent. 

The petitioner has the burden of establishing that the parent 

owns and controls 50 percent of the claimed subsidiary. To enable 

the Service to determine whether de facto control exists, the peti364 
Interim Decision #3008 

tion must identify all agreements between the parents relating to 

voting of the shares, management and direction of the subsidiary, 

and similar factors which affect actual control over 50 percent of 

the subsidiary. Unless such agreements restrict actual control of 

one parent, the 50-percent ownership will be deemed per se control. 

The petitioner has provided sufficient evidence to establish that 

Hospitalia is a subsidiary of Siemens AC. The evidence shows that 

Siemens AG has de facto control over 50 percent of the voting 

shares. It jointly manages the joint venture, shares equally in its 

profits, and manufactures the equipment sold and installed by Hospitalia. Since Siemens Medical Systems, Inc. is a subsidiary of Siemens AG, it is an affiliate of Hospitalia. The subsidiary and affiliate relationships in this case conform to the holdings of Matter of 

Hughes, supra, where it was held that (1) the term "subsidiary" is a 

more specific form of affiliation in which the company so described 

is subordinate to the control of another, and (2) the term "affiliate" 

is sometimes more specifically used to describe the relationship between two companies which have no direct linkage, but are directed, controlled, and at least partially owned by the same parent corporation. We conclude that there is a qualifying relationship for 

purposes of section 101(a)(15)CD of the Act between the petitioner 

and the beneficiary's employers abroad. 

B. BENEFICIARY'S EMPLOYMENT 

It is evident from the facte of the case that the beneficiary had 

been employed abroad continuously by subsidiaries of the same 

parent corporation since 1975 until his reassignment to that parent 

in January 1985. His employment was in a specialized knowledge 

capacity and the proposed employment in the United States will be 

in a specialized knowledge capacity. It has been established that 

the beneficiary's employment qualifies him for classification under 

section l0l(aKl5XD of the Act. 

ORDER: The appeal is sustained. The decision of the district 

director is withdrawn and the petition is approved. 

365